fixed price contracts

[multisync]

I was asked for input on a potential new customer today. Basically it's a small chain of sandwich bars who have ac and fridges etc. 10 outlets in all and scattered in and out of town.

They want a fixed monthly fee to service and maintain. We want to win this one as they expect to add 10 outlets a year going forward

So how on Earth do you rpice a contract like this

Boss said "What do you reckon?"
I said "Not an effin clue..."

Anyone got experience of these?

[Brian_UK]

That's a tricky one for sure.

How many visits per month/week per shop unit ?

Are they wanting 'very' regular visits to ensure that they can continue trading without breakdowns etc.

Would you plan to visit on a rolling basis or hit them once a 'period'.

What about breakdown response ?

How much room is there for your guys to work on the equipment, also, of course, are there times when you can't get in to do your job such a pre-lunch for eg.

[superswill]

A company i use to work for had a very large retail chain contract all inclusive,price on square footage it work well,yeah some you lost on but other you made on,from memory it was based on two minor and two major visit a year.i guess with the current client customer want to forecast overheads some i am sure we will see more of these,for me maybe its worth building in a longer fixed term i.e three years and an inflation based price increase every year

from memory there were curtain elements that was not covered by the contract and chargeable or the client paid a percentage

[dannycool]

No real experience with this but i would tender in groups of 5 or 10 stores at a time

1) Find out hot much kit is in each store, then work out time needed on site, 45min for a split 30mins for a fridge for example. Apply your hourly rate (including overheads) x visits per year.

2) Work out he milage of the ten stores from you office, then work out the average (You win on some stores, lose on others) Then apply your milage rate 40p per mile example.

3) Add cost for a cleaning materals (Rags, coil cleaner, smellie stuff, etc)

4) Put your 20% mark up on.

5)Set a call out rate with a response time.

Before you submit your tender you need to make a few clarifications, such as out of hours working, equipment schedules, F gas registers, call out response times etc.

Hope this helps, as i say ive no real experience of quoting maintenace contracts.

[taz24]

I was asked for input on a potential new customer today. Basically it's a small chain of sandwich bars who have ac and fridges etc. 10 outlets in all and scattered in and out of town.

They want a fixed monthly fee to service and maintain. We want to win this one as they expect to add 10 outlets a year going forward

So how on Earth do you rpice a contract like this

Boss said "What do you reckon?"
I said "Not an effin clue..."

Anyone got experience of these?

I have never done it personaly but a company I worked for charged a set rate per Horse Power of the site.

I do not know what the going rate is but back then it was £90, So If the total Hp of the site was 10Hp then that is 10 X 90 per store per year = £900.

It worked with the supermarkets but there was a lot of Hp in a store. It could work but you would have to be accurate with your price per Hp. Get that right and the rest will be easy.

taz

.

[taz24]

I have never done it personaly but a company I worked for charged a set rate per Horse Power of the site.

I do not know what the going rate is but back then it was £90, So If the total Hp of the site was 10Hp then that is 10 X 90 per store per year = £900.

It worked with the supermarkets but there was a lot of Hp in a store. It could work but you would have to be accurate with your price per Hp. Get that right and the rest will be easy.

taz

.

I spose it would not take long to work out the Kw duty of one average store, then work out how much it would take to maintain that one store. Divide the total into the Kw duty of the store and you then have a figure to base your quote on per Kw per store.

taz

.

[multisync]

Thanks for theinput. The supermarket formula of hp or KW works I suspect because of the density.

Think Subway - A cassette, couple of dairy decks and display counters etc

We reckon 1/2 day per store for a maintenance visit but how to factor in breakdowns when some stores are 100 miles away..

[Abe]

What you do in your calculation is factor in statistically on this basis.

Assuming 5 stores

Store 1: 5 miles
Store 2: 10 Miles
Store 3: 20
Store 4: 20 miles
Store 5 100 miles

Equipement for each store:
Age
Etc
Time to service:

Add up

Breakdowns:
This is where the statistics come in, what is the likyhood of a breakdown against the age, condition of a piece of apparatus,

Say Shop 10 has a fridge say 10 years old.
The possibility of a breakdown is high, say on a counter, 10 points.

So factor in a potential breakdown say once a month, or two.
Add the costs to your total.

That way you covered to effect a repair to this once a month.

Disclaimer:

I would in the contract remove your liability for equipment you deem to be out of the contract, ie: old stuff.

You contract ONLY for equipment you think you are able to service.

Otherwise you be stung with having to repair old useless stuff

I hope this helps, I know its crude the way Ive put it down byt its a mathematical exercise. Try get a university grad whos just passed his maths degree, to work it our for you.

He may do it for...........Beer noney!!!

[John MacK]

"To service and maintain"

It depends on what they (the customer) think that means and what you think that means.

Do they only want/expect to pay the fixed fee every month irrespective of how many times you visit and how many parts you change. Or is it purely for maintenance i.e cleaning and checking etc and parts for repairs will be extra.

I'd want to clarify that and then work it out from there as discussed above.

[R1976]

I normally price for maintenance only then give them an hourly rate for breakdowns and then a quote for any repairs. At the end of the day, someone is taking the risk on the reliability of the equipment and I'd rather it was not me.

I would put a good price in if I was taking a risk so I explain that they save money by a pay as you go contract and they normally agree.

[chemi-cool]

fixed price contracts means that sooner or later, you are going to very sorry you have signed such a thing.

An other way of doing it is a monthly payment to cover working hours and mileage and extra payment for parts.

Are there such contracts in your Kingdom?