Homeowners Versus Contractors

CLamb

From my experience most consumers have no idea how market economics works. They judge prices on their intuition and on how much they can afford.

As a home owner I am indebted to the posters on this site for all I have learned. I learned that my existing steam boiler was installed wrong. I learned that when a contractor told me, "Copper? Copper is OK.", I should say good-bye.

Daveinscranton

I have read this thread with interest.  To me, it comes down to trust, integrity, competence, and fairness.  

As a homeowner, I avoid contracts like the plague.  I would rather have a handshake with an honest person.  And pay promptly.  Long term relationships (decades) follow.  I have not had disputes.  If something doesn’t work, we fix it.  And move on.

Any transaction has to be fundamentally fair.  To both parties.  I recognize that poor communication/unrealistic expectations can be part of the problem.

PC7060

@RollCNY - “ defense contracting 300% markup” is certainly not the case across the board.  Single source aircraft suppliers can afford higher loading rates but profit is typically capped at 10-12% of fully loaded cost which is pretty low considering the huge capital investments.   

Services contracts in DOD are often significantly less than the target 8%. And then you have the government actively recruiting your employees and converting the jobs to government positions so you are faced with diminishing revenues. 

Simple truth is every service business has its challenges and you have to know your market and manage your costs to ensure you pay your bills, your employees and yourself.  

EBEBRATT-Ed

@KarlW Your right and they closed a lot of trade schools and got rid of the shops in the junior and high schools. Big mistake.

I think it is starting to turn around fro what i have herd.

Larry Weingarten

Hi, Just read the whole thread... Long ago, I didn't want to have to compete on price, so I specialized in domestic hot water. It wasn't too many years before I was getting referrals from the water company and power company, who both have rules saying they never refer contractors. I was also getting referrals from other contractors. I sent them all the other plumbing work that wasn't about hot water, so that part made some sense. So, the way to sidestep the whole competitive pricing issue for me was to specialize, and give the kind of work to other contractors that they liked best. Guess I've spent most of my life in left field.

Yours, Larry

EBEBRATT-Ed

@Larry Weingarten

LOL Its called a niche. I know people in the business who found theirs and did very well. Me, I looked for one for 46 years then retired

hot_rod

Learning to be a good plumbing or hydronic troubleshooter is a good niche. Stay away from the price sensitive new installation price wars.
Troubleshooters should never be out of work and can pick most any location to ply their trade.

Help wanted ads on trucks and wholesalers walls all around N America.

Mad Dog_2

I'm not an officer of Plumber's Local #1, but  almost a 40 year, extremely proud member.  Yes, candidates do line up circling the blocks and many camp out for days and take shifts in line and stay at local hotels and motels.  They DO give preference to Veterans (as they should) and participate in Helmet to Hardhats.  

That is to get a spot on the coveted 5 Year Apprentice program.  However, The M.E.S.
Division (Repairs) has entry level positions available AND Mechanic positions, but my two friends who own Union shops cannot get any good help.  Its a crisis, really it is. Mad Dog 🐕 

realliveplumber

One of the biggest problems is salary.

Ive heard many established plumbers and shop owners " I interviewed this guy, experienced and seemed like a good fit. But He wanted $50.00 an hour. I could never afford to pay him that"

Sure you could. You just dont want to.

hot_rod

realliveplumber said:

One of the biggest problems is salary. Ive heard many established plumbers and shop owners " I interviewed this guy, experienced and seemed like a good fit. But He wanted $50.00 an hour. I could never afford to pay him that" Sure you could. You just dont want to.

Your customers pay his wage, I’ll bet many would not mind his selling price for a competent, clean, sober, and on time tradesperson

Mad Dog_2

Wow, Paul..you worked for George Brazil? A Plumbing Legend...Is the company still going? Mad Dog 🐕 

Mad Dog_2

My two cents.  On Long Island 🏝,  NYC, Et cetera, the ONLY companies that pay really well are Union shops or National Franchises like Home Serve,  Roto Rooter, Benjamin Franklin, et al. The franchises may not have top mechanics in every truck, but they are
24/7 365, Live Person answers phones, uniformed techs, not high or drunk, well stocked trucks and professional.  There are a very small handful of Non-Union shops that run the same type of outfits, but they are easily 25% LESS well paid.  

Been there, done that, got the T Shirts...
Anyone who is ANY good is going to 

1) Go out on their own (licensed or not).
2) Go to Con-Ed, National Grid, LIRR MTA
3) a large Hospital or University or school district .
4) Get in the Union.
5) Cops, Fireman, any civil service jobs.
6) Large Franchises.

I have seen first hand, with over 25 employees at different times, 6 at once, that no matter how much you train them, send to seminars, paid vacations & Holidays, Et cetera, you CANNOT match the benefits, fringes, easier workplace, better hours, countless sick days, annual leave, comp time et cetera.  Additionally, they eventually want to make MORE than the owner gets in Salary.  

The Public accepts and expects to pay big bucks to the Franchises but will scoff at a small, otherwise very professional AND much more competent and experienced plumber & heating shops' prices.  In many of these cases, the ONLY real benefit for the owners is freedom to route their own course in life.  Being able to make all your son's Wrestling & football practices AND games, being at my daughters volleyball 🏐 & basketball 🏀 games, Science Olympian events is PRICELESS. 

Being able to be there for my Mom's Cancer ♋ battle, knock off early for a cocktail 🍸 at the Club, take your kids to their first day of school...THIS is the BEST part of running your own business, not always the $$$. Mad Dog 

Jamie Hall

Ler me say first I have no desire to disparage unions. They do an extremely valuable service, both for the their members and in training new craftsmen. OK? No fight please. But let me also say that in some 50 years of consulting engineering, I have worked with shops or individuals which were union and which were non-union. I have seen the good, the bad, and the ugly in both. Being union or non-union is no guarantee of quality or competitiveness.

realliveplumber

Serious question, why does the boss (owner) need to make more than the employee?

Say you have a guy that is being paid $100,000.00 a year, plus benefits. Probably costs what 140-150k to the boss.

Say he consistently produces, and earns the boss 75k a year net. Excellent reviews, satisfied customers. Minimal call backs, hardly takes a vacation, always on time, never not once complained about a crappy (literally) crawl space or ditch, will work late without a comment. Will jump into any task with both feet without hesitation.

Id go for that all day long.

Mad Dog_2

True. I've been on both sides a few times, but I never crossed a picket line or bid against a Union Shop. I always had too much respect for the Apprenticeship they put me through and the bloody battles we fought in the very early days.  Mad Dog 

hot_rod

realliveplumber said:

Serious question, why does the boss (owner) need to make more than the employee? Say you have a guy that is being paid $100,000.00 a year, plus benefits. Probably costs what 140-150k to the boss. Say he consistently produces, and earns the boss 75k a year net. Excellent reviews, satisfied customers. Minimal call backs, hardly takes a vacation, always on time, never not once complained about a crappy (literally) crawl space or ditch, will work late without a comment. Will jump into any task with both feet without hesitation. Id go for that all day long.

Because the boss or owner assumes all the risk.
if something goes wrong, an accident, fire on a job, the owner or boss are on the hook.

As the owner/ boss you get to determine what you feel is a fair compensation for the services you provide to humanity. Hopefully it is as much or more than a manager at a fast food joint🤗

Mad Dog_2

Realiveplumber....is that a rhetorical question 🤔  or a joke?  

1) Who gets sued?
2) Who gets calls at 3am?
3) Who takes ALL the risks?
4) Who often goes without a paycheck in lean times? 
5) Who has the stress? Agita? Grief?
6) Who's left holding the bag at the end of the day?
7) Who goes to jail if taxes aren't paid?

The Business owner...who should ALWAYS be paid as much, but better yet,
more, than the highest paid worker. Only exception, I'll give you is Professional Sports for Megastars who are so amazing they bring in ALL the notoriety and $$$
Mad Dog 🐕 

SlamDunk

I want to raise this question again: How can a homeowner be assured they are getting properly sized equipment before the day of installation with out asking questions on a touchy subject? Too big, and Im saddled with excessive fuel costs. Too small and we are not comfortable.

To riff on @realiveplumber's post, McDonalds told us what a Big Mac is in the 70's: Two all beef patties, special sauce, lettuce, cheese, pickles, onions,on a sesame seed bun. And, they post what it costs behind the counter and I know if it will sate my hunger. But how do I know I will get what I need to heat and cool my house if they wont tell me? How can I protect myself?

trivetman

realliveplumber said:

One of the biggest problems is salary. Ive heard many established plumbers and shop owners " I interviewed this guy, experienced and seemed like a good fit. But He wanted $50.00 an hour. I could never afford to pay him that" Sure you could. You just dont want to.

Is that the attitude which keeps the trades down as a career?  

Schools for years had a ‘college or nothing’ attitude.  Maybe thats changing to some extent.  But there needs to be the opportunity to make a good living for it to be attractive.  Not all college paths lead to good money but theres a lot that do lead to six figure salaries as an employee, not as an owner.  Yes there’s the cost of college which needs to be considered but it seems that working with your hands still has a low financial ceiling unless you’re the owner (and maybe if you own your shop as well).

Long Beach Ed

The problems in the trades are bigger than "blue collar" vs. "white collar". In our society, at least here in New York, the working class is getting pummeled with inflation, currency debasement and roaring taxation. A modest home costs $550,000 with $18,000 annual property taxes.

No kid growing up here expects to live the American Dream that their father lived working a blue collar job. Many feel their only chance is landing a Wall Street gig after borrowing $80K for a college degree. Of course academia is all too happy to perpetuate this attitude.

The tradesmen role models are too often missing from their lives, and they are lacking guidance and real-life examples of personal success stories. A majority have no fathers in their lives or their fathers are potted plants.

When a car lease is $800/month and rent a minimum of $2400, who aspires to a mechanic's career bringing down less than six figures? Around here it's too often the uneducated, foreign speaking immigrants and ex-cons who wind up in the trades working for small businesses that often fail to train or develop their workforce.

Jamie Hall

Reading @Long Beach Ed 's comment and a few others... the city and the suburbs -- whichever big city you cate to name -- aren't the only places where skilled tradespeople are needed. If one can bring one's self to wrench away from the delights and fun of the bright lights and all -- and stay away from the fewer cities -- there is a huge swath of the country from the Appalachians to the Sierra Nevada, usually termed "flyover country" where there are a lot of people and still a lot of opportunity -- and the cost of living is half that of the cities and suburbs, or less. There is a giant chunk of New York State -- not "upstate", but really upper New York State which is the same way. Parts of Vermont (not the route 100 valley or the cities of the Champlain Valley) which is the same. Most of New Hampshire except the Manchester and coast areas. Most of Maine, except the coast. The list goes on.

Now I've got admit that the rural life and small towns may not agree with many people. In lots of ways. But there are compensations for that. Thing to do is to find and hook up with an established, known, reliable trades person or craftsman, swallow the city ways, work hard -- and have a wonderful life.

Jamie Hall

Just for giggles I did a quick Zillow search in Vermont's northeast kingdom. Get yourself a very nice four bedroom, three bath house in excellent condition, big lot, in town, for less than $500K -- and except for one overpriced property that was the most expensive one I could find. The least was under $100K.

hot_rod

SlamDunk said:

I want to raise this question again: How can a homeowner be assured they are getting properly sized equipment before the day of installation with out asking questions on a touchy subject? Too big, and Im saddled with excessive fuel costs. Too small and we are not comfortable. To riff on @realiveplumber's post, McDonalds told us what a Big Mac is in the 70's: Two all beef patties, special sauce, lettuce, cheese, pickles, onions,on a sesame seed bun. And, they post what it costs behind the counter and I know if it will sate my hunger. But how do I know I will get what I need to heat and cool my house if they wont tell me? How can I protect myself?

Ask for reference or past installation pics. Do some preliminary calculations yourself, like a load calc
hire an engineer or hydronic design specialist  to write a scope of work for the bidders
Mod con boilers take away some of the oversizing concerns

Ask questions as you would a surgeon  
CPA, financial advisor or attorney 

Mad Dog_2

A Homeowner can be assured by doing their homework and/or paying for a Heat loss or EDR load calculation to properly size the boiler.  In my neck of the woods I quickly got tired of being the only contractor ACTUALLY doing the math, putting it in my quote, only to lose the job to the Jackals when the HO showed them I sized it.  You get tired of being a free estimating service.  Have to protect your valuable time. Mad Dog 🐕 

RollCNY

Jamie Hall said:

Just for giggles I did a quick Zillow search in Vermont's northeast kingdom. Get yourself a very nice four bedroom, three bath house in excellent condition, big lot, in town, for less than $500K -- and except for one overpriced property that was the most expensive one I could find. The least was under $100K.

I live in NY, and when I saw @Long Beach Ed 's post, I thought no way that is true.

So I got on Zillow for my area, and zoomed out a window to get 199 homes (I was shooting for 200). If those, 57 were listed for more than $250k, and of those 57, 6 were over $550k. So I was thinking there was hyperbole in the post.

Then I went to a random spot on Long Island, and got a window with 90 homes. Only 8 were under $550k. So it boggles my mind that for his area, his terrifying numbers look spot on. It is amazing the difference in a 2hr and change driving circumference.

ChrisJ

RollCNY said:

Jamie Hall said:

Just for giggles I did a quick Zillow search in Vermont's northeast kingdom. Get yourself a very nice four bedroom, three bath house in excellent condition, big lot, in town, for less than $500K -- and except for one overpriced property that was the most expensive one I could find. The least was under $100K.

I live in NY, and when I saw @Long Beach Ed 's post, I thought no way that is true.

So I got on Zillow for my area, and zoomed out a window to get 199 homes (I was shooting for 200). If those, 57 were listed for more than $250k, and of those 57, 6 were over $550k. So I was thinking there was hyperbole in the post.

Then I went to a random spot on Long Island, and got a window with 90 homes. Only 8 were under $550k. So it boggles my mind that for his area, his terrifying numbers look spot on. It is amazing the difference in a 2hr and change driving circumference.

Check out 08840

It's not even NYC.......

SlamDunk

@Mad Dog_2 , @hot_rod

This is my point. I did do my homework. I know what my heat loss is. But how do I know if the contractor quoting the job isn't going to install another incorrectly sized system if he feels the home owner will take that size and give it to the low bidder?

I understand the concern for contractors. It is legit.

But, I really don't want to find out six months later that what I bought is incorrectly sized and deal with the hassle of getting them back out to replace the unit.

This is a loop hole for both contractors and homeowners. Contracts and warranties are worthless if contractor is cash strapped or out of business.

How do we close this loop hole to protect both parties without offending each other?

ScottSecor

@SlamDunk if you did the heat load and presented the numbers to the contractor, that would be one less step they needed to take. If I was the contractor, I would verify you knew what you were doing first. Then I would treat you like the PE (Professional Engineer) that design some of the larger commercial jobs we work on. We will propose the equipment for your job that will meet (or slightly over) your head load numbers. There is one catch, our contract would read something like, "Boiler is sized based on homeowners load calculations, not ours. Homeowner takes full responsibility for the sizing of the new boiler."

Over the last thirty five years or so, a few homeowners (that were not a professional in our field) attempted their own heat loss calculations (or standing radiator count). To date, they always asked us for a second opinion to verify their numbers. Most realize we have been trained at this and do the calcs often, so we are familiar with the process. I'm sure many professionals have been to IBR and Manual J training like I did when I got into this business.

Intplm.

trivetman said:

realliveplumber said:

One of the biggest problems is salary.

Ive heard many established plumbers and shop owners " I interviewed this guy, experienced and seemed like a good fit. But He wanted $50.00 an hour. I could never afford to pay him that"

Sure you could. You just dont want to.

Is that the attitude which keeps the trades down as a career?  

Schools for years had a ‘college or nothing’ attitude.  Maybe thats changing to some extent.  But there needs to be the opportunity to make a good living for it to be attractive.  Not all college paths lead to good money but theres a lot that do lead to six figure salaries as an employee, not as an owner.  Yes there’s the cost of college which needs to be considered but it seems that working with your hands still has a low financial ceiling unless you’re the owner (and maybe if you own your shop as well).

Take a look at what inflation has done over the years......... Take a look at an inflation calculator.
Go ahead and pull out your phones and check say.....fifteen dollars an hour was back in nineteen eighty three and check it towards todays time frame.
What's the rate?

Did you find a price of about fifty bucks an hour? Some food for thought.

SlamDunk

@ScottSecor,

All the contractor I spoke to had to say “yes, my numbers are close to yours and you’ll be happy”, Or, “no, our numbers are far apart and we need to go with mine”.

 As it stands now, I have a 120-ish thousand btu furnace with a 2.5 ton ac unit on an 800 sqft brick ranch where normal temps are 45 to 90 with a few exceptions.  I’m not a pro but I have a house in NYC with a furnace rated in the low 60k btu and a primary house 200 miles away and both homes are twice+ the size of this ranch.  

On my primary house, I just asked about sizes and the conversation went like above. Contract was done & Done.

But as you have read so far, not everyone is willingto have this conversation with a homeowner.  

The OP titled this tread  homeowners versus contractors.     I’m just trying to find a practical way to get a job done properly without the adversity.     Afterall, I got what I got on trust but it cost my parents (and now me) to operate.   They had no idea.  

EdTheHeaterMan

I

Mad Dog_2 said:

A Homeowner can be assured by doing their homework and/or paying for a Heat loss or EDR load calculation to properly size the boiler.  In my neck of the woods I quickly got tired of being the only contractor ACTUALLY doing the math, putting it in my quote, only to lose the job to the Jackals when the HO showed them I sized it.  You get tired of being a free estimating service.  Have to protect your valuable time. Mad Dog 🐕 

I just had an interesting experience with a construction company that recently did a Bathroom remodel for me. I wanted to do an extensive redesign because I wanted a roll in (no curb) shower for my wheelchair accessibility. Bath fitters and those other companies you find at the home show only wanted to swap out my curbed shower with a cookie cutter replacement design. They were more interested in the material and products that they have and less interested in what was actually needed.

Then one complan showed up with exactly what I needed, The free estimate was a ballpark only and if I wanted a firm price in writing I would need to place a $2,000.00 non refundable deposit and they would provide me with a computer rendering of what the finished product would look like with all the details, fixture choices, tile design, and locations of all the fixture locations. That $2,000.00 would be put towards the purchase price of any job they did. I can see that this might make a consumer that is just shopping look elsewhere, but I thought that this was a great idea and I wrote a check for $2,000.00

I got to thinking about this, What a great idea this was and how this could apply to our industry. My father’s business had a elaborate presentation to sell replacement oil burners that dazzles the consumer with some facts and figures but more graphics and pictures of the oil burner, combustion chamber, draft control and an 11 x 17 oversized photo of a beautiful Gold Ring Honeywell T87F round thermostat that would be attached to the wall where that old dingy thermostat was located. We sold a lot of burners in the 1960’s thru the 1990’s. And at half the cost of converting to a gas boiler.

What if we had a 8 to 10 minute video of @DanHolohan telling the story about “How did that boiler get so big” from one of his webinars. Then a few before and after photos of the work we do. Along with some testimonials, that a customer could watch while we take a tape measure and start to do the floor plan and/or a picture of the old boiler, so we can do the load calculation back at the office.

Once the video was over we would sit down with the customer and offer them the Ballpark number (if we could based on experience) or a will cost more that $??.000 and see if you are still interested. Once you qualify the customer as a real prospect. Then you offer to do the full monty estimate including the load calc, and a rendering of the boiler room after you spend a few hours at the office. And that will be completed for a small, non refundable deposit of $X00.00 that will be applied to your purchase of any of the projects offered by our company.

Then you walk away with a deposit before you ever start to do the estimate that will take a few hours of your time. If the customer says your price is too high after you did all that work, then at least you have a deposit for the time you spent.

If the prospect doesn't want to give you a small deposit then maybe you don't want to waste your time on that person.

But the bottom line is; once you get that small deposit, chances are, the customer will stop shopping and you will get the sale. Just be sure to have a Good, Better or Best price available for the customer to choose from.

Mad Dog_2

Just be honest with him and speak about it..Old Fashioned way. Mad Dog 

Mad Dog_2

Living in Nassau County Long Island.  We bought the 1899-1900 Old Hitchcock Farm & Barn in 2000 for 282K.  Put $500K in over 24 yrs...Just appraised for 1.1 Million!  
I hope to leave for the Kinder.  Very hard for Youngsters to buy  house on Long Island 🏝 unless they have killer jobs and no student loans....Mad Dog 🐕 

RollCNY

@SlamDunk
I was in your exact spot (well almost exact, 1800 sq ft but similar 120k btu boiler) and four contractors all were going that size or bigger.

With the fifth guy, where I could tell him that I only had 130 ft of fin tube, and I had 40% of it closed off, could I get him to go smaller, and he still would not size as small as I requested. I didn't think he would even work for me when he told me he wasn't concerned about if I was happy or not, but whoever owned the house next, and I promised I'd scrape his name off of it so he wouldn't have to worry.

In the end, it worked out, and I could manage the system will water temperature and controls. So an oversized boiler, even in the worst case, shouldn't be catastrophic. And even when people say it is inefficient, the truth is it is "less efficient", and lowered supply temp even to 160° can make significant reductions in gas consumption. My conventional boiler that now has draft dampers and electronic ignition, and ODR, and is 90k input rather than the 60k I wanted, is a massive improvement where I was.

So all you can do is work with the best of the contractors that you have access too, even if they can't fully right size, get them to at least down size, and make sure you can tune from there. The price difference between a smaller boiler and a larger is small, typically like $200 in all the models I was looking at, so the risk should be small.

EBEBRATT-Ed

Oversized it depends on the system. On how water it's just an efficiency thing on steam it is efficiency, insistent short cycling and maybe just won't work right.

And wasted money on any system.

RollCNY

EBEBRATT-Ed said:

Oversized it depends on the system. On how water it's just an efficiency thing on steam it is efficiency, insistent short cycling and maybe just won't work right.

And wasted money on any system.

This is right, my comments were specific to my hot water baseboard system, and I assumed @SlamDunk was dealing with same. I have limited/no familiarity with sizing other things and didn't mean to convey that I did.

Teemok

@EdTheHeaterMan In CA we can't take deposits legally without a contract. The lesser of 10% or $1000. We can sell a service that we can then credit to a later approved contract. The limit of that service cost is $750. I think your idea works and I have done something like it with bigger design heavy jobs. It's a good way of respecting both parties interest's. You do run the risk of a customer being the kind who wants it for free or no deal. Then the contractor whiling to go out on that limb will win the bid. The design fee acts as a filter.
My experience is it's the face to face and what is said that sells jobs. Often sizing and precise design are given up to the contractor after trust is established. Establishing trust is the key. The customer will often tell you what they need for it. Some need numbers, references, some want to feel you fully understand their needs and they completely understand your logic and how you operate, some just judge by the look in your eyes and the handshake. Read the customer and have good self protective boundaries. If they like your game they will pay to own your design work before signing the bigger deal. If they pay you and use it to beat up another, there's not much you can do about that but you got paid.

EdTheHeaterMan

For those of you that want to see the new roll in shower.

Here are 2 of the renderings I paid $2000.00 for

And here is the finished product.

After I few little women's touch accent pieces, I think we will be done. Art Deco is the look I was going for. What do you think?

ChrisJ

@EdTheHeaterMan

It's certainly better than this roll in shower.

Jamie Hall

very nice! Slightly jealous...