Tradespeople on other forums

[JHZR2]

Originally Posted By: VeeDubb
I'm not a tradesman, but I'm not sure why their cost structure should be the primary determinant of the price they charge. There is a demand side as well and the market sets of the price. That is how every business in a free market economy works. To impose some sort of cost-plus type pricing on tradesman seems rather unfair. We pay ridiculous markups for soda pop and Apple products and nobody ever asks for their price structure. The market is the market.

If a tradesman charges a ridiculous price, guess what - demand curves are downward sloping. They bear the cost in terms of lost business. It is self correcting.

I do have a problem however with a contractor that doesn't keep promises, does shoddy work and then puts hidden costs on top of estimates. But that is fraud, which is a different issue.


That's fine, it is correcting, as I am not hiring for their services. If I decide to go this route, I will get wholesale equipment online and DIY install. Will even go for my EPA license to keep refrigerant on hand. I wanted to do that anyway so that I could get R12 for my cars should I need it.

And if the equipment needs service, my money is green, they will show up.

But Im letting my wallet do the talking in the free market. Now they get $0 dollars to hold up for the off season.

Again, I dont get this kind of pricing structure in any other trades work that I have ever had done. Free market or just plain gouging and padding hours, I dont care, I dont see it as good value, just charity because work slows in the winter. Plenty of others get laid off when this is the case. If I stopped having work coming in for a long time, I would. Only difference is that I cannot gouge customers for extra hours for the off season, and my total burdened hourly rate is actually less.

 

[VeeDubb]

I hear what you are saying. Voting with your wallet is the best way to go.

But I'm not sure how you would define gouging. I don't know how gouging can occur so long as there is some competition in the marketplace. No electricians or plumbers I know have complete freedom to set their own price in my area. If they charge $200 for a job that most others are charging $125 for, they lose business. However, if they charge $125, that is the market and it doesn't matter if their cost is $25. That is not gouging. If I went by markup over cost, then I'd say sodapop makers and Apple are big time gougers. There is no way an iPhone should cost $700 retail when the cost is $40. But this being a free market and Apple facing significant competition, they are not gougers.

 

[TooManyWheels]

Truth be told, I think there are many businesses that are ripe for collapse, or at least more open competition, due to the information ubiquity that the internet allows. These would be ones where the key tradesperson advantage was sequestering of knowlege, rather than specialized skills or analysis.

 

[mechanicx]

Originally Posted By: VeeDubb
I'm not a tradesman, but I'm not sure why their cost structure should be the primary determinant of the price they charge. There is a demand side as well and the market sets of the price. That is how every business in a free market economy works. To impose some sort of cost-plus type pricing on tradesman seems rather unfair. We pay ridiculous markups for soda pop and Apple products and nobody ever asks for their price structure. The market is the market.

If a tradesman charges a ridiculous price, guess what - demand curves are downward sloping. They bear the cost in terms of lost business. It is self correcting.

I do have a problem however with a contractor that doesn't keep promises, does shoddy work and then puts hidden costs on top of estimates. But that is fraud, which is a different issue.


I don't mean to take sides or anything but I really agree with your post. Forget seasonal trade labor. People seem to question skilled trade labor rate and compare it to mass production hourly rate. But they don't really question the high mark up that is in these good. A better example is what healthcare providers charge but since it is normally covered by insurance people don't think much of it. It's very hard and not all that lucrative doing skilled trade work when dealing with direct paying consumers. t's part of the reason more intelligent and skilled people don;t go into or stay in skilled trades. The money just isn't there.

 

[HTSS_TR]

Originally Posted By: JHZR2
But when the lump sum includes 16 hours on a 4 hour job, isnt that crazy too? Being an ostrich with head in the sand doesnt make the issue go away.

Im OK with 'lump sum', versus charging "hourly", but Id still like some transparency in where the costs come from.

Little off topic.

My trusted mechanic charges $50 labor per axle:
Replacing brake pads only.
Replacing brake pads and rotors.
Replacing brake pads and resurface rotors.

Someone says that $50 for replacing brake pads only is a ripoff because it is a lot less work compares with replacing brake pads and resurface rotors.

Someone else(that me) says replacing brake pads for $50 is acceptable and you get resurface rotors or replacing rotors for free.

Same thing for oil change, he charges a fix price of $25 for 3 or 4 or 5 quarts of conventional oil. If you brake down the cost then 3 quarts oil change should be $5-6 less than 5 quarts. For drivers with small sump they may think that $25 is a rip off, while the ones with 5 quarts sump are happy.

If you know the total cost up front and if it is reasonable to you then have them do the work, if not then find someone else. There isn't much else you can do about it.

 

[JHZR2]

Originally Posted By: mechanicx


I don't mean to take sides or anything but I really agree with your post. Forget seasonal trade labor. People seem to question skilled trade labor rate and compare it to mass production hourly rate. But they don't really question the high mark up that is in these good. A better example is what healthcare providers charge but since it is normally covered by insurance people don't think much of it. It's very hard and not all that lucrative doing skilled trade work when dealing with direct paying consumers. t's part of the reason more intelligent and skilled people don;t go into or stay in skilled trades. The money just isn't there.


See, I dont want to question skilled labor rates, and as stated, I dont really. When I call the plumber, the electrician, take my car to the shop, etc., I dont ask them why their rate is $90 or $130/hr.

Similarly I dont really care to ask the HVAC guy either.

The thing is that when I get the other trades to quote me work, I get a breakdown to time and materials, from every one. Easy then to compare jobs with good understanding of what is involved and why.

It allows me to make a determination of value to my liking.

So to get a lump sum, and then have to wonder why it is so obscenely high to me is an insult when it isnt done that way from anyone else doing any other work that I ever get quoted. Its not that I care if the HVAC man charges $50 or $150/hr, its that when it rationally is being charged for a substantially higher number of hours than is needed, it is just insulting, and again, not inline with the way that any other work is quoted.

 

[mechanicx]

Well I don't mean to defend residential HVAC guys or other construction related trades. They might tend to try to estimate too high and don't have standardized hours and rates. I was just talking about being in skilled trade in general that the direct paying consumer is pretty skimpy revenue.


My main problem the few times I have used a residential HVAC guy is the shoddy work they do for the money charged. And they don't really do what you tell them or they said they'd do. I don't like sloppy, shoddy work at any price, especially not at a premium price.

 

[greenjp]

Originally Posted By: JHZR2
Again, I dont get this kind of pricing structure in any other trades work that I have ever had done. Free market or just plain gouging and padding hours, I dont care, I dont see it as good value, just charity because work slows in the winter. Plenty of others get laid off when this is the case. If I stopped having work coming in for a long time, I would. Only difference is that I cannot gouge customers for extra hours for the off season, and my total burdened hourly rate is actually less.

We've presented you with all the info you need to "get it". You say you don't care if it's free market - but that's the whole point, that's what it is. There's nothing else to get.

As for it being "charity", well I can see why the tradespeople you encounter in other forums would have a problem with your attitude. Charging enough to run a profitable business, including enough to carry them through the slow seasons, isn't charity. It's called running a business. You still haven't proposed a realistic pricing structure that accounts for the seasonal realities and specialized nature of the HVAC business. Nor have your thought to respond to many of the analogies that have been posted. It seems clear to me that you don't want to get it.

jeff

 

[JHZR2]

No, youve presented some info. Doesnt mean I have to get it or accept it.

I have no attitude in any other forum. But the trade folks do - along the lines of how dare you ever ask why we would charge what we do - dont you know we have a business to run?

As for the analogies you speak of - if the costing structure in HVAC is so substantially different that it is reasonable and accepted that for every hour of work that I pay for, I subsidize two hours of non-work in the offseason, then to me this isnt an analogous behavior, so it is apples and oranges. That isnt simplified pricing structure, that is subsidization of idle time.

Do I want to get it? Really I want a deal that I see as equitable. I dont find paying 3x the required labor hours for the chance of no work in the future as equitable. I do find paying a fully burdened rate of $130-150/hr for the actual time required to perform the job including costing it, obtaining the equipment, and installing it to be equitable.

So Ill DIY and these folks will wonder why they can't keep their businesses running. Guess that's the free market working...

 

[greenjp]

You clearly have no interest in actually understanding it, you'd rather just rant.

The analogy of the higher prices for wedding halls in June vs. February was perfect. I'd be interested in your take on it.

What you condescendingly call "subsidizing two hours of non-work in the off season" is what other people call "providing for their families". It is the nature of their business and the laws of supply and demand that lead to that structure, regardless of how transparent their pricing is (or isn't).

As for your DIYing it, good for you. I'm an avid DIYer myself (cars, motorcycle, around the house stuff, appliances, etc) but I'm under no silly illusion that it my DIYing means professionals won't be able to keep a business running. They've already figured out that market-based pricing (ie actual costs are somewhat irrelevant as has been pointed out in numerous posts you haven't responded to) is what keeps their businesses running , whether you can grasp the concept or not.

jeff

 

[JHZR2]

What part of voting with my wallet don't you understand? I started the whole thing with the intent to understand - first met by rudeness on the HVAC forum because I dared to question it, then here because I don't agree 100% with some analogous approach.

Whether they are padding it because they can (in season or not, supply/demand type arguments), or padding it because it is standard practice, I dont care. I am not in a pinch where I have to be subject to what I view as thievery, because of the excessive levels of what is being charged.

Tons of other folks loose their jobs, get laid off or have a really bad few months when work isnt coming in. Im not wishing that on anybody, but the blatant overcharging of hours with that as an excuse is a bit much (and Im not really buying it because forced air is prevalent enough around here that Im sure there is furnace and related work in the "offseason". Im not spending my time responding to each scenario as you think I need to, because this is a practice in this industry that I refuse to support. Whether the same thing occurs in other trades/industries/products that I buy is essentially irrelevant. One assigns value as they see the value proposition earned or meeting a desire. While I desire AC, I can do it with better value in other means, and so I will not be subject to the markup in the means that it is done typically in HVAC. It rubs me the wrong way, and perhaps if there was a bit more transparency I would be willing to use the services. Whether I choose to do so on a value, need or difficulty proposition basis for other goods and services is essentially irrelevant. Anyone could arbitrarily say that anything is overpriced by whatever it is.

Yet it all comes back full circle, in reality there is zero transparency in HVAC, which is a different mode of operation from most any other trade Ive dealt with. What is so hard to understand about my dislike of this practice?

And my dislike and distaste for this practice means that they don't get my money. Simple as that.

 

[SteveSRT8]

Originally Posted By: JHZR2
Originally Posted By: SteveSRT8
around here AC is not very seasonal.

And it's 'lump sum' bids only for me. Any competent pro can give you one.

Personally I think anyone who agrees to per hour pricing is crazy.


But when the lump sum includes 16 hours on a 4 hour job, isnt that crazy too? Being an ostrich with head in the sand doesnt make the issue go away.

Im OK with 'lump sum', versus charging "hourly", but Id still like some transparency in where the costs come from.



I agree wholeheartedly, and would not use anyone who could not fulfill your needs.

I believe it is up to the service provider to educate his client and thus they will then make a correct choice.

This means you must be completely happy with the info provided, or I have not done my job. This has served me well over decades in a ridiculously competitive business environment.

 

[greenjp]

So you're making two separate comments at the same time. First is that you find the prices offered by HVAC companies to be too high to present you with a worthwhile value and that this has led you to plan on DIYing it. Totally with you and that's exactly the same reasoning I use (in addition to the aspects of having fun & learning something new) when deciding to DIY something on my car, bike, home, appliance, taxes, etc.

What I don't get is the outrage/anger with the fact that the market they operate in does not conform to some arbitrary standards you have decided on. You want them to be more like electricians or plumbers or whatever, while discounting the valid reasons they operate more like wedding halls, hotels, vacation homes, insert thing that costs more at certain times of year than other, etc. What's hard to understand about your dislike of the practice is that you're expressing outrage with free market pricing. Sometimes the free market results in prices you're happy with, sometimes it doesn't. But it's the same forces at work regardless.

jeff

 

[JHZR2]

Youre totally right, it may well be the same market forces, that's fine.

But in my view the approach and way it is done is excessive and that's what turns me off.

I go to the beach quite a bit. The summer rate in the hotel we stay at isnt 4x what the offseason rate is. I dont frequent wedding halls, so that isnt a comparison that is valid (to my situation). Vacation homes (parents have had two, we are starting to look for one) dont actually loose a ton of value in the offseason, and the supply characteristic is far different for renters, with far more options (distance from the beach/lake/mountain, size, amenities, etc) that allow you to make a more tailored decision. And again, there is transparency in that you can decide if what you are paying for is sensible based upon what it consists of, not just that we are going to charge n times more than it costs because that is what it is.

And again, it is also a matter of perceived value of the services and product. This one rubs me way the wrong way, so it is what it is.

 

[bigmike]

For HVAC, I know a church member who owns his own HVAC business. He does all the work himself, owns his own truck, etc. It's just him, basically, but he's licensed and insured. He charges realistic prices and gives you a breakdown of cost and labor. He's been fair to me, so I usually give him a tip.

One thing to note is, he does charge more when demand is high. I can't blame him for that as his days becomes 12+ hour days. Catch him in "winter" and it's 60 degrees, and he suddenly becomes very inexpensive.

I've had to blind call HVAC places before and their pricing for installation or repair is ridiculous. However, there have been several places that will sell me parts for decent prices.