water heater competition with Home Depot

MT

By the way this place is awesome! I been having problems selling water heaters. Customers call me up and ask me what I am getting for a wh. I usally get between 550 for electric and 650 for gas 40 gallons. So I tell them and then they go to home depot, or they say I was just at home depot today and I want you to install my wh. Then I tell them I do not guarantee HD WH's, and I tell them why. but 9 times out of 10 they still go with home depot. Anybody else have this problem? I have been in business for 6 months now and I am doing pretty good. I heard you guys talking about Ellen Rhors book "Where did the money go" I am reading as we speak great book, just hope it will help me and my company be more profitable, its a little complicated to get started but I am determined.

jim lockard

jim lockard

MT

If you treat a water heater as a customer provided product, let the H.O. pick the WH up, and get it in place and dispose of the old heater. That leaves you to drain the old heater, cut the old heater free, and install the new. Should their be a problem with the customer provided product its his problem, not yours. Set a price you can live with and thats it. OH make sure you get a signed agreement before you start. Best Wishes J.Lockard

Bill_14

and

be sure to EXCLUDE any warranty work.

Bill

Mark Eatherton1

Another important book...

Dan Holohans book, "Just add h2Ohh". Learn how to sell the sizzle, and not just the beef. In fact ANY book ever written by Mr Holohan is worth owning. I know. I own pretty much all of them.

ME

Mijola

HO supplied water heaters

On thing that you can be sure of. If that heater leaks shortly after YOU install it, YOUR insurance will be drawn into it.

I don't care what kind of deal you worked out with Mr. HO, you are on the hook for that heater. Even it it WAS his heater, if it leaks, NOW its YOURS.

How much is Mr. HO paying you for that risk.

Just my thoughts

Ed Carey

Mijola

HO supplied water heaters

One thing that you can be sure of, if that water heater leaks shortly after YOU install it, YOUR insurance will be drawn into it.

I don't care what kind of deal you worked out with Mr. HO, you are on the hook for that heater. Even if it WAS his heater, if it leaks, NOW it’s YOURS.

How much is Mr. HO paying you for that risk?

Just my thoughts

Ed Carey

Mark Hunt

I'm with Ed


Write all of the disclaimers you want, this is a breeding ground for trouble.

Look, I was told a long time ago that I couldn't compete with the other guy because he was cheaper than I am. OK. I decided to STOP COMPETING. There is a REASON he is cheaper, and it isn't because he honest and I am a crook.

How many businesses have gone under because HD and Lowes decided to offer water heaters with installation? None in my area. They typically hire contractors that have such bad reputations or the worst marketing department in the world.

Do not ever worry about those people. You passed them 1000 miles ago.

A quote from the book of Markisms (this is copyrighted stuff so if you use it you owe me $100 per use)

"What is the largest piece of glass in your vehicle? The windsheild! What is the smallest piece of glass? The rear-view mirror! What is a multi-billion dollar industry telling you? They are telling you that what is behind is not nearly as important as what is in front of you. Are you racing to stay in third? Or racing to win? You decide."

Again, if any of you ever even think this, you owe me $800.

I know I said $100 at the beginning of the post, but then I remembered that Dan said if you don't charge them $800 they won't take you seriously. So $800 it is.

BTW, Sears was once considered enemy #1 by the trades. Weren't they recently purchased by a company that recently claimed Chapter 11?

Mark H

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MT

thanks

Thanks for you guys for all your help, I guess I realize that I have to really sell my product and why it is much better than theirs, and why if I am installing it is a better move.

Geo_2

water heaters

We only "install" what "we" sell!!.

al_17

HD and HO's

I've found that HomeDepot customers dont want to pay for professional services, they expect a cut rate from everybody.
LPC

Dave Yates (PAH)

tweak your pricing!

Add up what it costs you to install a water heater - on average. If you're reading Ellen's or Dan's books, you'll be acutely aware of what you need to charge to earn a reasonable profit on the average installation. Add your perofit and costs together - less the bare-bones cost of the tank - and let that be your customer-supplied tank pricing. You still get your margin, they "feel" like they've won, you get them to sign off on the warranty issues & you both win!

Takes just a few minutes to work out the strategy & you can do the customer pricing by phone in a snap. They walk? What have you lost - nothing. They bite - what have you gained - possibly a customer and one who, next time, might just forego the aggravations of having to lug around their own materials. Sooner or later, you get the whole enchilata!

Why walk away from work on which you can not only get your margin, but gain market share by building a wider customer base. The Home Depot and Lowes stores aren't going away, so you might as well develop a strategy that puts you in the driver's seat where profits are concerned.

We still lose sales to the big box stores, but not nearly as many as we did when we fought against the tide. The ones we get carry the same profits as those where we sell materials - and without the warranty liabilities.

Now, work for the DIY big box stores? No way in hedoublehockeysticks! They hire the bottom feeders at pricing that's below margins. They win - the contractor AND the HO both lose. Been there, priced out the flat rate they use & offered them FR pricing where we both could profit - no dice. As long as they can get uneducated contractors to agree to a two-hour install time (which includes going to their store to obtain the tank), they'll never consider letting the installer in on the profits.

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