Saturday, March 19, 2011

Plumbing During a Recession

Yes, I used the "R" word! Recession!

The recession is happening to everyone; not just Southern California, not just the United States, everyone! Jobs are being lost, stocks are losing value, people are losing their homes and so much more.

In the last year, I have noticed the trend. Some of our customers started holding off on small repairs, or having their own "maintenance" personnel make them. Then the questions about the bills started - from customers who had never questioned a bill!

Now, we get the bargain shoppers; the ones who call ten different plumbing companies trying to find the cheapest. In many ways, this is a good idea, but I think there are times when it can come back to haunt you.

About 8 months ago, my boss and I sat down and went through every line item in our price book. Since we have well over 1,000 items in our price book, this took quite a bit of time. What we were trying to do was find places where we could cut our prices, without cutting our throats financially. I mean, you have to make enough money to stay in business!

We managed to cut almost every price in the book and, when we were done, we felt pretty good about it. We have always believed that we charged a fair price for a good job, but now we can say that we have cut our prices even further to help get us through the recession.

I am rambling a little bit here, but I wanted to give you some background in order to pose a question.

Is the lowest price always the best price?

I am sure that most of you know that the answer to this is a resounding "NO!" You have probably heard the expression, "Buy cheap, buy twice". If you buy the cheapest dishwasher(for example), it will probably not last as long as the more expensive models, and you will probably have to pay for repairs more often. You may end up paying more for the cheap one (with all the repairs, etc.) than you would have it you bought the more expensive model.

Another example is tires. I recently bought a set of 4 tires for $300.00, including mounting, balancing and sisposal of the old tires. I thought this was a great deal and was very excited to get it. Well, the tires run very rough and make a lot more noise on the road. They don't seem to hold the road as well (this could just be my imagination). I have to add air to them a lot more frequently than I have ever had to add air in the past. One of them blew out while I was on the 55 the other day and completely shredded, and it only had about 8000 miles on it. I think I will buy better tires next tiem.

The same hold true for services. You can hire the cheapest electrician, auto mechanic, or plumber. You may get lucky and find someone who is both good and cheap. It is much more likely that you will find someone who is cheap because they are not very good. Either they won't be on time, they will take too long, they will have to go find parts (for which they will charge you more) or something will probably come up. I have heard horror stories about people being ripped off by service people who come to their home. Here are a couple of ides to help keep this from happening to you.

1) Make sure they have a license. All plumbers, electricians, carpenters, etc, anyone who does work on your home, has to be license by the state. Ask them for their contractor's license, then you can go to the Contractor's State License Board website and check them out.

2) Make sure they have insurance. All licensed contractor's in California are required to have insurance. Ask to see proof of both General Liability and Workman's Comp. insurance. Don't take the risk that if they get hurt on your property, they will sue you!

3) Get a written estimate or contract up front. I will grant you that I do not know everything there is to know about every contractor's business, but I do know that they should be able to give you a price before they start. If nothing else, they should be able to give you a "Not To Exceed" (NTE) price. An NTE price says, we will do this work and we will not charge you more then this amount. If we find anything that will cause our price to go up, we will stop and inform you. At AB&R Plumbing, we always give a written price up front.

4) Ask questions. This sounds like a no-brainer, right? Of course you will ask questions! The problem is, many people do not ask. They think they will offend the guy or that he will end up charging them more if they ask! (I am guessing, I really don't know why people don't ask questions, it's your money!) You don't have to be antagonistic and get in the guy's face! Just ask! "What is this charge for?" "Are you offering any sort of discount right now?" "Is there a way we can get this done for less money?" "I can't be home before 4:00PM, can you come then?" ASK!

There are other things to look for, but you get the idea.

Good luck and, if you need a plumber, we have already cut our prices to allow for the recession. We didn't cut our service, the quality of our work or our concern for our customers, just our prices.