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Work based below price just to give staff something to do to fill the gaps between the more profitable works instead of laying off the staff or reducing the hours.
How is it a sweet banker for you, when the wage is so low?
All depends what the price and access etc is I guess, I know of a local contractor who charges cheap rates for cutting BIG areas of grass with good access, because quite simply it keeps his agricultural workers busy between planting and harvest. Yes he only charges £x per ACRE but with a 10 or 12 foot (or bigger) set of gang mowers they are in and out in not many minutes, however he can't deal with the bad access jobs that my 6ft6" gang mower and compact tractor CAN get into....
Swings and roundabouts I guess...
Daniel Goree said:
I can't afford to effectively pay a customer to employ my blokes. I have a fixed cost for every job and if the charge is below that cost then I'm operating at a loss. I can't survive by losing money.
Perhaps I have misunderstood your point?
Seth Burgess said:
Perhaps I am being thick and missing something here. If it costs x to do a job where x is a fixed cost for everyone, and y is a charge which is x plus a percentage profit, why would you charge z which is a charge below x when y is the figure at which you can, as a minimum, break even?
I don't mean to upset anyone's apple cart but I am struggling with this. I don't mind losing out on contracts where the figures add up and the competition have come in at a lower profitable price.....that's business........but to loose out to a price that is, in my view, business suicide is really annoying and gets right up my nose.
IMHO it makes us honourable landscapers/gardeners/etc look like greedy idiots when in reality we are honest business men and women who have thought hard about the economics of our industry and offer a respectable rate for a respectable job.
Maybe I'm just biased as it's happened to me, but really, operating at a loss, how do you justify it?
Gary Smith said:
Also, what are your overheads to theirs?
If you pay £100 per day and they pay £60, then their costs will immediately be lower than yours.
The costs of charging out machinery will also vary. I know some who don't charge and others that charge equivilent to hire rates...
I would agree with Gary Smith, would you want to work for someone who is after the cheapest price? If you did get the contract, who's to say that the client wouldn't be expecting more and then quibble the invoice...?
As another point, how do you know the other price is so cheap, who told you? If the client, they could have been playing you, to try to get a cheaper price. If the other contractor, what's to say their not just winding you up?
I win and lose contracts all the time, it's the job. I don't begrudge any of my piers, on the basis we are quoting for a similar job and the job is carried out to the correct standard. But then sometimes we are not quoting for the the same job, they have presented a different option, the client likes it and decides to go with them, without asking for new quotes.
Does not make sense to me but maybe that's the way said people are looking at it.
As others have said don't worry move on to next job.
If you don't value your company no one else will.
Try not to join in a race to the bottom on price!
Andy said:
What I mean is like Richard has just said, it may be work to fill the gaps for staff rather than have them do nothing during that time.
Seth Burgess said:
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