Customer buys own boiler

DanHolohan

I'll vouch for that!

Dave's on the album cover, full monte. Of course, he was a lot cuter in those days.

Supply House Rick

Profit Killer?

This seems like a profit killer to me. A contractor will only charge labor to make a profit? What respectable company would agree to that? I am sure that NRT does a fine job for the homeowner but is this really contractor friendly, can he really make enough to make this worth while? *Say there is a problem with design/equipment/materials* WHO pays contractor? NRT? Homeowner? Seems complicated and the contractor will lose on call-backs every time. I could be wrong...

Rick

Unknown

I'm not taking offense at all; I just don't understand why you guys want to get angry about the way the world works instead of learning to work with it. It's that simple. You have value, charge for it.

Though for you, I do have a hint, I don't recommend slinging mud when you have very little clue what you are talking about. If you have to ask what differentiates me from big orange or my "CONTRACTORS ARE TRYING TO SCREW YOU" competitors online, then you don't know first thing about me, my company, or what I do all day long. I'm not interested in posting a sales pitch here about how great we are though, so if you're really interested, email me. Otherwise, I hope the venting felt good.

Empire_2

A few of you mentioned....

Talking to the manufacturers and expressing the dissatisfaction with the selling of equipment to the public. It actually makes me mad when they sell this way. I cannot get a Ford E-250 van from the Ford manufacturer, I have to go through the dealer. That's the way it should be. Even besides the liability and other possible implications, The equipment is probably to large or to small for the job. Munchkin is going the Wal-Mart Rout.

Mike T.

Unknown

That's true Rick, it can be complicated with multiplier players like that. I won't bother to describe our stance because this is a more general discussion.

But tell me this; if someone comes up to a contractor of yours looking for a nice mod/con boiler and storage tank, is that contractor going to make decent money on that install for the time involved?

Constantin

Honestly...

... the only instances in which I can believe them to be competitive with local suppliers of the same things is whenever there are no local suppliers. Think about it: First the stuff gets shipped to Maine, purchased, now shipped back to where it goes in either assembled or non-assembled format. Last time I checked, shipping is not cheap.

What NRT does offer is one-stop shopping for all your distribution needs, particularly as it pretains to high-quality fittings, valves, etc. that may be very hard to get in some parts of the country due to an absence of hydronic heat demand. Ditto for pre-assembled distribution boards, manifolds, etc.

As a homeowner, my preference would be for one company to "own" a particular part of the project. That allows them to charge me a total price based on the parts and the labor. Then, they also "own" an issues with the install, whether it's warranty-related stuff or mistakes.

As others have pointed out, most contractors mark up their equipment cost to supplement their labor income and to cover warranty work and the aggravation of dealing with the manufacturers for reimbursement (a.k.a. the full monte). So if a HO wants to supply the equipment, then any equipment issues not related to the installation method should sit on the HO's shoulders, not the installing contractors'.

As a contractor, what do I care where profit comes from? At the end of the day, no one goes to a car dealership with parts either. At best, they shop around until they find someone whose total price is acceptable... So if a contractor were to charge a higher labor rate because he doesn't get to skim the cream off the equipment purchase, so be it. I have no issues with that.

IMO, the best bet for the industry is more educated consumers that know what they want and why they want it. NRT and it's staff does a lot for consumer education, as does this site, the RPA, etc. The more people become aware of the advantages of hydronic heat, the more the industry will grow, and the more work everyone here will have.

Thus, my focus would not be on criticizing those that could be construed as competition, but to partner where possible.

Unknown

Thanks constantin, but just a point of clarification, we're not one-stop-shopping. After a couple of stupid moves right after we started our company, we do not and will not sell heat sources to DIY'ers. so they have to make at least two stops

Mike Miller

HO supplied

I have been in this business for almost thirty years and it is getting more and more difficult to make a profit. I started my business a year and a half age and I simply send the customer to the BIG ORANGE anyway for fixtures and faucets. However, I will not install a HO supplied water heater or boiler. The warranty issues and liability issues are too great. Better I sit at home losing money doing nothing than to work my **** off to lose it. We, as tradesmen are simply up against more competetion than there was when I did my apprenticeship. Both inside the ranks of trained tradesmen and outside of it. The manufactures are seeing it as good profit and good sense to make their products easier to install, with most of the engineering done in their house so that they can have more control over it. The only value we have to sell is our customer care. There are a thousand guys in my town with a master's license. Some of them may even do a better mechanical job than I do and they are willing to do it for a smaller profit line. Or God forbid, no profit at all, just building themselves a paycheck. This business has changed in the last thirty years and it will continue to change, most of us may not like they way it is going, but we had better think about what the future of this trade is going to be and do something to influence that. And I will be the first to admit I don't know what the answer is here. The frustration I feel with this business probably jumps off of the pages. But I want to say that I love this site. It is nice to know I am not the only one in this position.

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EdyLogicMstr.

Radguy Flaming NRT

Radguy,

You couldn’t be more incorrect about Rob and his business. There is no “club” and I’ve found both Rob & Dave (NRT) to be without ego when it comes to giving advise as well as taking it. Why should he not be giving this information freely to contractors? It seems to me that YOU think of yourself as belonging to some sort of a club.

When you’ve compared NRT to Home Depot you must simply be ignorant of what they actually do. Therefore, I guess it’s ok if you have no respect for him or his advise. You are correct in assuming that “you are not in the same boat as we are.” Our boat is seaworthy. He doesn’t and has never “bypassed the contractor.” It's been our experience that instead, they work closely with and for them exclusively when asked to do so.

His team design for both contractors and homeowners alike. Nothing wrong with that! Their designs are some of the very best and most appropriately designed systems I’ve ever seen. I’ve found myself in over my head on some VERY complicated systems that required actually inventing new ways of controlling multiple loads and redundant control stratargies and the results way exceeded any of our expectations. I see absolutely NO similarity in the way in which Rob & Dave conduct their business to the infamous companies you have slanderously mentioned.

Making a profit on selling a boiler/distribution piping is old school thinking IMHO. Slim profit margin at best when dealing with very educated clients. Who are the educated client these days? ,,,,,, Nearly all of the people that want radiant heating in my experience.

“If there is ever a problem with design/equipment/materials who pays the contractor?” Good question. To this I say that whomever supplied the materials is directly responsible. This always falls back on the contractor. The relationship the contractor has with his wholesaler/supplier will dictate how the OEM responds to defects in workmanship/materials.

What’s the difference in buying design work and some distribution materials from NRT as opposed to buying these materials from our local wholesale supply house anyway? One that stands out in my experience is they don’t specify equipment that is inappropriate for the application just to make a sale. It seems to me that this would be a win –win situation to any installing contractor that has a desire to provide an appropriate system without using the “free system design” work from the supply house. (Don’t want to go there with you with Rick;-)

So Radguy, why don't you show us an attachment of one of your projects?


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Dave Yates (GrandPAH)_1

maybe

A shot of Milne on the jacket would help sell CD's?

Sounds like there's a shot for the Wall gang to do a little singing? Will that be prior to libations or after many have been imbibed?

BTW, in high school, my 10th grade German teacher offered an "A" for anyone who would stand in front of the room and sing Du, Du, Liebst Mir Im Heirzen" (sp?). I got that "A"! If'n I remember correctly, those who didn't run out of the room in horror damn near killed themselves laughing(G).

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Supply House Rick

Gary

I was looking at this from a contractor's point of view, wasn't starting anything, just questioning call backs etc. I was just trying to see if this makes sense to me. I used to manage a 10-truck plumbing & heating company before entering sales. Could care less if I ever designed a system again as a supplier. Just asked for a little info...

Rick

Steve Ebels_3

In the end

In the end, markup on the boiler and other parts really doesn't mean anything. What matters is if you made enough to cover your expenses and have a few percent left over for profit.

When a customer asks if we'll install equipment that he/she has purchased, I say it depends. What matters to me is if it's equipment that I respect and can get parts for because if I install it, I feel responsible for it and to the customer. Lot's of times I say no because what they have is some off brand garbage or worse yet, something used. If it's a brand of product that I am connected with and can warranty for them I don't have a problem with it. If it's a POC and I can't get warranty reimbursement I walk.

I tell them going in that whether they furnish the equipment or I do, I still have to generate $xx.xx per day. Making the money on equipment or labor makes no difference. The business overhead stays the same regardless of who furnishes the goods. They have to understand that my business needs to generate a certain amount of income every day or it goes under.

Perry_2

That's a resonable approach - It's selling service

Steve:

That is reasonable.

In the end there will always be a place for people selling a service. Selling parts is a tough way to make a living as someone else will find a way to undercut you on parts.

I've now had some people tromp through my house looking at my old boiler and discussing what I want to do longterm with the house (get rid of the chimney - and use its space for AC ducting to the 2nd floor in future years).

I've not had a single person even suggest to me that they would be willing to sit down and design the proper solution for my house - and discuss options and tradeoffs with the different boilers and technologies out there.

They are all so keen in trying to come up with the cheapest "today" installation... The "low bid" dispite the fact that I tell them up front that the low bid is probably not going to get the job because I am looking for the overall project value - and point out the nice paint job I had done last year and mention that he was the high bidder on painting.

Quite honestly; I'd rather not part with the $4000 - $6000 I figure this (and some other work) will cost me. But if I'm going to do so - I want it done right and I want a high value system. Not the cheapest system that will "work" today.

My question to many of the Professionals: What is the primary thing you are selling: Parts, Labor, or a Service.

If you are selling service - then who sold the parts does not matter as long as the parts are of reasonble quality and suitable for the job.

Of course; positioning yourself as a service provider requires a change in approach and perhaps in execution of a job. But, there is always work for people selling a needed service.

Perry

Unknown

You really just hit the key point

There ISN'T always work enough. It comes in bunches. If you don't do A/C much, because of climate or some other reason, the months each have a different meaning. From March through August, the installations sold determine how many guys make up a crew. In August, through Christmas, there aren't enough guys to go around, preparing for winter. It's the same guys. From Christmas, through thaw, It pretty much levels out, workload wise.

If some of the work is done by others during the slow season, and that work doesn't perform when the busy season comes, I'm surely not going to put off a customer of MY installations that requires service so I can clean up a job my competition did, or a homeowner did. To do an installation job for a homeowner that waited this late in the year would be a problem, too.

My rambling point is this. Time of year might work against you, or for you, when you are trying to get a company to "just sell services". The customers that allow you to schedule installations around the "annual" service schedule are the customers that you reserve time for when they call for service in the "season".

The customer that ONLY calls during the coldest weather isn't very valuable. He's a scheduling problem. He never adds to the guy's regular year round workload, but he surely insists on service at his time of choosing, usually making for a LONG night at work.

In your non-heating job, how would you look at a customer that only scheduled you to work at night, but never warns you which night or weekend it's going to be? Would that guy be valuable?

Or would you rather offer emergency service to the customers that make up the crew's 40 hours of work every week?

Sorry I got off track..... It's all related, though.

Noel

Perry_2

Good point

I totally agree - you serve the customers who hired you to do a professional installation first - using good quality components - and don't really quibble over your charges. I do want to point out that in the overall scheme of this post - that you may need to deal with a customer who did in fact by a major (high qualtiy) component elsewhere - but is willing to pay a reasonable fee for a good installation. I think that is fair. But, you can put last on your list the people who only call because of a poor installation by others - or who installed the cheapest junk they could buy.

I also understand the seasonal nature of things, normal work schedules, and emergency calls. I work in a large power plant with multiple generating units. We have schedule maintenance that never stops. We have scheduled outages that have horrific work schedules (6 12+ hours per day each week for a month is common for me: I typically run two different service contractors doing a lot of work). We have emergencies that must be dealt with now... That pager goes off and I better be ready to "pop to..."

Perry

EdyLogicMstr.

16.000 circs?

Holy cow. I've got to stop what I'm doing right now and just be in this for profit alone!

I've been also amazed at how many ads I see from the infamous companies published in magazines when I visit other peoples homes. What disturbs me is seeing them in Fine Homebuilding and the JLC. Someones kids are going to get a good education at the college of choice. Perhaps MIT or Harvard.

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Mark Hunt

Are we supposed to be impressed?

> Not the first time this has happened. Hopefully

> the last.

>

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> 296&Step=30"_To Learn More About This

> Professional, Click Here to Visit Their Ad in

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Eric_21

Wow, look what I started. I was the HO that originally contacted Wayne. I did not run out and buy my own boiler and then look for someone to do the install, the boiler was bought by my contractor for me as I explained to Wayne (see below). I was just looking for a well qualified contractor to install the system for me because my original contractor fell through. I completely understood Wayne's reservations, he gave me the name of someone else to call. My main concern at this point is to make sure that the Ultra is installed correctly . . .

"Wayne,
I found your contact information at "find a professional" on heatinghelp.com and have been following posts on "the wall" for several years. It is a great website and I have learned a great deal about condensing boilers among many other things. I have a boiler (WM Ultra 105) and indirect tank (TT smart 50) that I need to have installed. Why do I have these and they are not already installed? A little background info: I discovered that my existing boiler (crown oil fired) was leaking toward the end of the heating season in 05. I drained the system and found a small hole and hairline crack in the block. I added stopleak to the system to limp along (if the leak stopped) until the end of the heating season. It worked and since my hot water is supplied via gas fired tank I was able to put off installing a new boiler right away. As the next heating season approached I realized that I had a mostly full oil tank and I wanted to burn it up. The fellow (HVAC mechanic for my building at work) that I had arranged to install my system went ahead and purchased the boiler and indirect for me to have on hand so that he could intall it. This was done so that I could run my existing boiler (and oil) and have the new system ready to be installed on a moments notice if it started leaking and when the oil was mostly gone. The install was put off for one thing or another and now the fellow no longer works in the area. The bottom line is that I need have a boiler and indirect installed before the fall heating season. Can you install this system for me?"

Wayco Wayne_2

Hey Eric

Good Grist for the mill. I hope the contractor I recommended can help you out. I guess after reading all of this it comes down to me not knowing how much I need to make per day. Being a small outfit I am very cautious since I don't have much office or parts running support. Something goes wrong that takes time out to run parts or warranty paperwork can really hurt the profit margin. The contractor I recommended is larger than me and has all of that and can probably help you with less risk. The Ultra is a fine product when properly installed. Thanks for stimulating an interesting thread. WW

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Kevin O. Pulver

When I start tuning up

> There's a line in the song T Bone Shuffle by

> Jesse Collin Young that goes, "Ever since I was a

> little boy, I've love to sing, I've loved to

> sing." That line fits me to a Tee. The only part

> of Church I loved, growing up was the singing of

> the old Hymns. (my favorite was The Old Rugged

> Cross) My first clock radio turned me on to the

> Beach Boys and the big hit of that time Good

> Vibrations. I'd love to have a recording of the

> "shower sessions" from back then and my trying to

> make something like the same sounds as them. Ha!

> Now I sing with the church choir and love a

> chance to solo. I sang the Baritone solo of the

> Fauvre Requiem last year, with orchestral

> accompianiment. What a rush. Control, focus and

> joy all rolled up in one. I've also played some

> coffee houses and the occasional Borders with my

> Guitar and Keyboards. A little Folk, a little

> Rock. I still get a little nervous beforehand,

> but once I start it all about the music. I can't

> say I've got an album though, Dave.

>

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Kevin O. Pulver

When I start tuning up

People often request that I sing "on a hill-far away."
Great artists often aren't appreciated until after they die.
Kevin