New to self employed

[priory]

Yes another new self employed engineer... I am in the U.K and

am finding it tricky to price a job. I dont know if

this sounds familier but when i price a job properley(ish) it still

gets looked at as if im trying to rip them off or the repair cost

outways the cost of the unit! Now as a service repair type

man i dont want them to buy a new unit....what am I doing

wrong???

[Abe]

Hello Priory

No big deal, its not your fault..........( entirely)
The media has recently portrayed artisans as crooks, so the public are naturally wary

Costing is basically a straightforward concept.

You draw up a list of all your expenses that you would incur in the prosecution of a job, all the parts, etc........You arrive at a figure.

You step this up..........say anything from 30% upwards
This is your profit.

That is the price you quote. He can take it or lump it.
If you go under that price, you are working at a loss or for peanuts.

If equipment is old...........SELL him new stuff
Whats the big deal in that
I will sell anything from an ice maker to a large cold room.

Its simple maths

All in about a 20 to 30 pound an hour charge should cover you. Wont make you rich, but will be palatable to customer

Fuel is going up again.....around 40 pence a mile.........would be ok

Good luck

[Abe]

Their is another element
Its Demeanour

Theres the adage about those who can sell, and those who cant

I guess theres a ring of truth around that one........but not always

I find honesty is the best policy......and being wise, and also hard headed with your entrepreneul cap on.

I face the day, saying Today I will Earn..............but we have feelings, we feel sorry..........hear a hard luck story, and whooosh...........your profits dissapear.

Find a balance between execution of a job to perfection.........and money in your pocket, that calls for an element of hard heartedness

Keep focussed on the opportunity, dont blow it, expand it, offer solutions, dont get bogged down in the mire and stalemate.

It is an art form............and easily learned by those at this game for a while.

It is why, you have so many self employed fridge techs............They now how to maximise an opportunity

I went thru the pitfalls just as any other novice

Now, I can sell your dirty underwear if I have to.

[herefishy]

Hi priory,

Before you fret over the (refusal) of your proposal, firstly you need to have *qualified* the prospect (customer). What service (product) is he really in the market for?

You may think that we are all offering the same services, in heated competition for the same customer base, but I do not beleive that is true. Each of us provide a wide range of value, expertise, and quality of service to meet the service needs of the differing wants of the customer base.

Do you have a business plan? It doesn't have to be written.

(One) of the basis of my business is; I only perform medium and low temperature refrigeration sales and service. Why? Because I don't want to loose medium and low temp business because I screwed up the prep sink faucet install, or the air conditioner, or the vegetable steamer.

Well, there are prospects in the market who want a "one call fixes it all" servicer. That is not a good prospect for me, and I don't spend any time pursuing anyone who is looking for that type of service.

_________________________________________________


Now, I'm looking at the 25 year old walk in cooler condensing unit with the burn-out compressor, improperly sized expansion valve (by others previous), oily (leakage) pitted copper in the evap with a fan motor out anyway, no pump down solenoid on the medium temp system.... and oh! the condensing unit is an air conditioning condensor to begin with! I wouldn't have my name on it. I recommend (naturally) that the CU and evap are to be replaced. The customer suggests that since the thing has been working for 25 years at that location, he just wants the compressor replaced.


Well, guess what? The customer called the wrong service company, because I do not provide that type of service. However there are five or six other companies in town that specialize in these type of systems. They install and service them everyday!
___________________________________________________

I know that you get phone call, every day, "I need my fridge recharged".

I begin to qualify the customer, right away, "Well, sir if you need your fridge recharged, then you need to have the leak repaired also". Then the interesting conversation begins. The customer learns a lot about me, and more imnportantly, I learn what kind of service that the customer is really looking for. He may come to the realization that that charging the fridge every year is not normal, and that a proper fix may be more involved or costly than the *blow and go* service that he has been receiving on the equipment over the past couple of years. If that's the case, he's a good prospect and I get to work.

On the other hand, he may just wish to have a *recharge*, for whatever reason (and actually such a response tells me quite a bit about the customer - I don't want to do business with). I don't provide that kind of service. In that case, I'll probably be told, after explaining my service rates and some speculation as to what the cause of his complaint may be, that I will be called back. In that case, I continue to mind the phone until it rings again, next time with the good prospect needing the exact service that I have designed my business to perform.


___________________________________________________

There is no right or wrong in this. It is just meeting the needs of the customer, and there is pretty much a place in the market for everyone to make some dough. But you need to *QUALIFY* your customer, to assure that they are looking for the (type of) service that you provide.


Cheers!

[chemi-cool]

hi herefishy,


I loved what you have written here. and agree with every word.

I think that us, the owners of small high quality service companies ectually pave the way for the next generation of engineers who want to exel in the field.

chemi :)

[Peter_1]

Herefishy,

Printed out your statement.

Never saw it that way but as Chemi said, it's all true and also the way I do my job, only...I was not ware of it.
You can call it also an attitude of a tech who respects his self and his job.

But it's also valid for your techs around you. They also need the same attitude as you described.

If every tech (plumber, carpenter..) should work like this, then there should be a lot less complaints.

[frank]

the *blow and go* service

Hi Mark

Love that phrase - might get to use it on the missus later :D

Frank

Good reply though and my sentiments exactly!

[Abe]

I thought the guy asked........How do you "price" a job, not whether he was in the right field, but I guess what follows could probably help as well.

[herefishy]

I thought the guy asked........How do you "price" a job?

Hi Aiyub,

I think that is what he asked... for sure... and I don't think that you missed the point. :)

I thought about it a moment... and like all the rest of us.. I've been in that boat.

When it comes down to... "Who can make it cool... for the least amount of $$$$$$$$", that's not me! It took me a long time to realize that it wasn' my price that was putting me out of the market... it was the quality of service/repair proposed that was the problem! That was not what the customer desired (in those instances).

So after I thought about priory's post... the first question that came to mind was, "Is the customer that he is proposing to, a good prospect?". If indeed the propsect is potential, and he is refused... well then we look at the pricing schedule.

If priory determines that he is serving the market that he is suited to.... then the mark-ups are an issue.

I just thought that the *cart might be put in front of the horse*, relative to the customer base that he is fretting over. I had tentative thoughts about the pricing issue too, but thought the issue (that I addressed) should be evaluated first.

Like the guy loosing the bids on the sale of packaged ice, and determining that his prices are too high is why he is losing out....




... but then you learn that he is selling to the Eskimo's!



Best Regards,

Mark

[Abe]

Hi Mark.

Yes, I get your point, and valid. So Priory, hope you have taken on board.

Actually, what Herefish says, is a crucial essence, which " seperates the men from the boys"

The way he, Chem and Peter1 pursue their business strategies is the way to go, and to aspire to.

ie: maintaining excellence and a proffessional ethic and solid business foundations and principles.

So wish you well Priory. Mark, nice to see you again. You have been missed.

Regards

Abe

[priory]

I thank you all for your advice and comments.

I really think that the whole `prospect` idea is very true and this is the way to go. I believe in offering a quality and value for money service and i suppose i will find a lott of potential customers will not see the big picture and only see the final £££££. But i will continue attempting to educate and enlighten, and leave the rest to someone else.

.

[Peter_1]

If you're sure that you made a honest offer, then you shouldn't not be angry on yourself if you lose a job.
Take an average margin on material (20% is a minimum) and count the hours that you expect to work for that job.

If you work alone, then there is nothing wrong if you counted the hours too less. You still will earn money but you had to work a Little bit longer for the money, that's all.

But if you have technicians to pay and you counted 100 hours and they worked 150 hours, then there is no space enough on the margins of the material to compensate this miscalculation and you will have to pay money to do the job.

What you can do in the beginning is taking less profit on your material and count your hours less then you should do normal.
I did that in the beginning and stipulated this on my offers.
That I was new in the field, but had a lot of experience and that I was looking for peoples who believed in me and my knowledge. I also said that I made a special price (not for repair) do introduce myself and that they could benefit from this.

Try then to give a quality job so that they see that it was through what you said.

The 20% margin is for us an absolute minimum to cover the working costs of the company. For small items till +/- 150 Euro, used in repairs, we use the gross price.

[whiffnsniff]

I've found that when you get a good working relationship with a customer - you get to know the money they make from jobs and can price at a level where you both make money out of jobs.
Some jobs I make less on the commissioning but then they give me more service calls to make it up.
You scratch my back and I'll scratch yours.
I'm always available on the phone to help their guys out with problems.
It's called giving a personal service which is what the big boys can't do.
It also helps when the work you do for them is top notch and you work on the principle of 'fix in one visit'.

This year I'm intending on taking on a fridge spark and the companies I work for are asking me to do it so I can do more work for them, My work is always to a good standard and they would rather pass extra work onto someone they can rely on.

Us small boys can be really busy but we always try to give our customer the best service.
Going to a large company that can send an engineer in the next 3 days is no good to them. Being able to get to the call that day or the next is what they want.
Good service plain and simple gets you the work


:D :D :D

[Servicefrigo]

Every country have the same roules in this domaine. To be spedy ,cheap,profesional & TECHNICAL god prepare .Fix the problem with only one shot.There is place for evryone in the summer god or bad .Next year the bad technicians will see outside is 32*C & the pfone does*t ring all day .too late!!
Priory
how the busines go after 1 year?