Why You Shouldn't Lowball
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- Опубликовано: 17 мар 2024
- In today's Down & Dirty, we're talking about why it's important not to lowball when bidding a job.
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I will say this hit the nail right on the head.
I’m 20 years old my brother is 18 we have a clapped out 790 excavator F450 service truck, and two skid steers, and a backhoe.
We work full-time jobs as heavy duty mechanics, for a big civil outfit, and do utility and lot prep after hours, and we lowball the shit out of the market because we don’t know how to bid we are getting better at it.
Keep the video coming because we’re learning but we have done the damage now we’re looking to hire people and there’s no way we can pull it on our profit margins.
Thanks for the honesty in sharing this. It's good to share the lessons you've learned with others in the industry. I appreciate the comment!
🎉 Thanks so much my brother 🎉 Great video🎉
Nah, buy what you can afford, understand your costs and what you want to earn and price it. If your equipment costs a bit less you can charge less. If your costs increase adjust accordingly. Pretty much everyone starts that way.
What if you're brand new and just want to build experience and are honest up front by saying "look, I'm new, I'm gaining experience, so I'll give you a very low rate to start with and my rates will go up as I gain experience"?
There's no problem with charging a lower price because you recognize the quality won't be there or you're accounting for having to fix some mistakes. The problem is when you are 6-12 months in and continuing to low ball the industry. You should only be charging lower rates on your first handful of jobs you are learning on.
You can't survive anyway,by running low ball.These guys come and go.First major breakdown,there just scrambling to find money to repair outdated junk.You can't survive underbidding running equipment on life support.My job is to give the customer the most efficient work for an hourly rate,using respectable equipment,thats what there paying for,nothing less.
100%
Lowballing is a good way to lose money in a hurry. My bottom line would be exactly my expenses. If that's still too high for the customer, they can hire the cheapskate who will botch up the job faster than I can get my truck starter.
Sometimes it is better to leave the equipment parked and let some sucker take the work.
@@DieselandIron Yep.
I won't participate in the race to the bottom
How do you figure out what the going rate is in your market area?? Assuming you are starting at zero with a bunch of equipment that you have accumulated over the years working on your own personal stuff and now you want some side income outside of cubical hell and nobody wants to share their numbers? -Asking for a friend 😉
If you know some people that have had some work done recently you could ask them what they were charged and back your way into the numbers. If you have contacts that are reasonably close but still outside your area of operation you could call them up and ask what rates are.
Nobody shares their numbers because their numbers will only work for their operation. Overhead, equipment costs, etc. are very individual. You have to do your own work to develop your own basis.
"I found a guy who can do it cheaper". Then you drive buy and it is clapped out junk that probably came off an online auction scrap pile, or all rental equipment and no commercial tags on the pickup's with magnetic signs on the doors. The new awesome is equipment getting delivered to jobsites by trucks with "Farm Plates" on them. Hmmm, really rocking that Ag CDL exemption, huh? And a lot of times it isn't a hole worthy of burying a dead cat in, let alone building a home on. I really love the guys doing it on the side, showing up after 4:30 pm and working all day on Saturday and Sunday. Yet, can't come out to do warranty work or a change order because they are at their "real job". Dirt work isn't rocket science, but it does require a base skill set, and a lot of common sense. Or a couple of RUclips videos and suddenly you're a "Contractor". Rant off.
Unfortunately that is one of the downsides to our industry having (relatively) low barriers to entry. You will always be competing with bottom feeders. The only way to get through this is to sell your value to the customer when you submit your price. It doesn't always work but outlining the scope of work and walking the customer through some possible scenarios that you have already thought about can help them recognize why it is worth paying more to have you running the job than the guy on the rusted out '84 pickup.