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Pricing work - and the damned cheap sign merchants!!!!

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Joe McNamara

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Post Sun Jan 26, 2003 11:54 am

Pricing work - and the damned cheap sign merchants!!!!

Hi all,
I thought I'd share an experience with you from the past couple of weeks.
I had a phone call from a BIG main dealer ( cars ) in Bristol to come in and price a job up for them. I went along, met the MD, and measured up.
The signs were grey 5mm grey foamex with their logo and large black arial letters, all vinyl. The size was 12.5 metres x 765mm and they wanted 2 of them in panatrim aluminium frames to be fixed to the existing fascia (very easy fit - straightforward ).
Anyway I went away and did a mock-up superimposed over a digital pic I took. I returned with the artwork and a sample of the foamex and ali trim and the MD came down from his office into the showroom to meet me. He then said he'd be back in a moment - wanted to show it all to another director.....anyway his P.A. came back down with the samples and said they would look forward to getting it priced up as soon as possible as they were happy with the artwork and the materials. (At this point I was going to ask for the artwork back as well but I thought best not to as it may have upset them and I might risk losing the job, and they seemed like professional people and looked like the job was mine......)
I faxed a quote over to them.... 2 of 12.5m x 765mm signs (approx 40ft x 2.75ft....big signs) at £824 each.....Total £1,648.
I didn't hear anything back so a couple of days later I rang the dealership and spoke to the MD.
He said they'd had another quote to do 3 of these signs...yes 3 of them...fitted for £1,650..that's £550 each!
Just to make sure I wasn't going mad I bounced the job off miketheswine and he said he'd be over £1000 each for this type of sign so I knew i wasn't far off the mark at £824 each.
The MD said if I could beat the price the job was mine......I said I'd think about it and let him know the next day. I went back to my office and priced the job up using the cheapest materials and it worked out I'd have made as much profit from the 3 cheapo signs as the 2 quality ones, BUT I'd have had to do 50% more work.............
I decided when I moved into this full time that I wouldn't get into the silly price wars game so I phoned him back the next day:
"Hi, I've priced the signs for you and yes I can do them cheaper"
him: "oh good"
"but I'm afraid I'm going to have to decline the job as the materials I'd have to use to do the job at the price you want to pay are not up to the job and I can foresee that you're going to have a lot of problems with it and you'll probably be disappointed with the finished job at that price whoever makes it for you"
There was a stunned silence and then he thanked me for getting back to him. I also suggested he get a written guarantee for the job from the people doing it.

It was another lesson learned - no matter who the customer is, or how high profile, you can never take anything for granted! (:)
Cheers
Joe
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Phill Fenton

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Post Sun Jan 26, 2003 12:50 pm

You're absolutley right to make a stand Joe. Your credibility would suffer if you were to agree to provide an extra sign free. (They would ask themselves why you hadn't offered your best price in the first place). It's better to walk away from some jobs - this gives you the time to make other more profitable signs.

Don't get into a bidding war where it all comes down to price - you'll end up working all hours producing loads of work - but making little or no money.

Lets hope the signs that do go up blow down on the first windy day that comes along :lol: :lol:
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TonyDwyer

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Post Sun Jan 26, 2003 1:56 pm

joe, never trust a car dealer! just look at boycy on fools and horses.
you can guarentee the other price he was quoted was £300 more than he said. he was trying you out.
as you walked away you should have looked at the dearest car in his garage and seemed well keen. play them at there own game.
take it for a test drive the lot. even work out the payments! if he thinks he is going to earn out of you for the car you might have a chance.
if you get the job everyones a winner. then tell him the car is not what your looking for. if you dont get the job, tell him youve seen the same car in another garage much much cheaper! and by the way in much better condition.

one up for the sign makers!!!!!!!!!!!!!!!
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Fat Bob

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Post Mon Jan 27, 2003 12:32 am

Hi Joe

Remeber It aint over till the fat lady puts the sign on the wall

I bet hell be back :roll:
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Martin Pearson

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Post Mon Jan 27, 2003 12:53 am

I think you did the right thing Joe, I always did the job cheaper if the customer said it was to dear or he could get it for less elsewhere untill the new year. I said at the end of last year that I would change things for 2003. Its still early in the year yet so I dont know if it will make any difference and we havent done a lot of work yet but so far I have stuck to it. I must admit its not easy and I nearly dropped the price on one job when the customer moaned but I held out and we still got the job.
Has this customer already gone elsewhere Joe ? You never know you may still get the job once he has thought about it.
Be interesting to see what he gets for his money if someone else does it. You will have to keep us informed.
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Neil Kelly

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Post Mon Jan 27, 2003 11:50 am

Well handled Joe I think he will be back its a dificult one because if he is trying it on its hard for him to come back to you so id chase him up in a couple of days I think its a brave and well handled approach its so easy to be bullied into giving discount and as Tony said it sounds like the patter of a typical car dealer..Good Luck
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John Childs

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Post Mon Jan 27, 2003 10:17 pm

Definately the right tactic.

Years ago a friend of mine, an agricultural engineer as it happens, told me he had stopped doing cheap jobs. His reasoning was that if he did a crap job the customer immediately forgot that it was cheap but that every morning when he stepped out of his farmhouse he saw the work and was reminded of what a crap job my friend had done. Definately not good business.

On the other hand, you need to be able to afford to take this stance by having a constant flow of good customers who are prepared to pay for quality work. If you haven't got this then it is all academic anyway.
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Phill Fenton

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Post Mon Jan 27, 2003 10:34 pm

Very true John.

It's been said that if you have a satisfied customer he'll tell two or three other people about the standard of work you do. However, a dissatisfied customer will tell about 8 people.

I suppose the moral here is:- It's a lot easier to get a reputation for doing cheap and nasty work - It takes much longer to get a reputation for producing excellent work.
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Paul Davenport

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Post Mon Jan 27, 2003 11:11 pm

EXACTLY.......i would have walked away from our fraser eagle job if he wanted me to adjust the price by despeccing it, which i actually told him .
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Chalkie

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Post Mon Jan 27, 2003 11:20 pm

a satisfied customer he'll tell two or three other people about the standard of work you do

And he'll also tell the price you charged - so if you do one cheap you end up doing them all cheap.
No point in being busy if you don't make any money.

Phil
________
Last edited by Chalkie on Thu Feb 24, 2011 1:09 pm, edited 1 time in total.
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Jaybee

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Post Tue Jan 28, 2003 1:20 am

Well done pal.

I tend not to deal with certain categories; car dealers, estate agents, plus a couple of others. I really don't need the hassle of supplying to an sector that is riddled with sharp practices. I very, very strongly doubt that any sign guy really gave him that quote, unless he was smoking some very pungent herbs.

Like someone else said, spend your limited time doing work for paying, worthwhile clients.
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Kevin.Beck

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Post Tue Jan 28, 2003 9:54 am

on the subject of people selling thier products cheaply.

while I was attending a car show, i got talking to another trader. he was selling car parts, which included tyres. we got onto the subject of selling items too cheap. he told me of the situation some of the traders were in. they all get their products from the same 3 ware houses, in order to compete with one another, they keep reducing thier prices to attract the customer.
this chap bought 4 tyres for £100, the most he could sell them for, due to everyone reducing thier prices was £112. thats £12 profit on an outlay of £100. utter madness.
thats the situation we don`t want to get in.

becky
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John Childs

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Post Tue Jan 28, 2003 2:54 pm

PERFECT TIMING for this thread.

I've just had one walk in. Amongst the usual stuff he wants the following on the side of his trailer which, he assures me, is a chinese proverb:-

"Remember, the bitterness of poor quality remains long after the sweetness of a cheap price is forgotten."

He then goes on to tell me that he cannot afford to spend much and ask how cheap I can do it!

Don't you just love them?
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Peter





Post Tue Jan 28, 2003 3:24 pm

This underlines the importance of copyrighting all artwork.
I supplied artwork for an a-board and quoted for a good quality board.
1 month later I see a "cheapie" outside his shop with MY GRAPHICS exactly.
I took him to small claims court and won £35 for artwork charges plus £10 expenses in producing documents for the claim,plus it cost him £30 court fee.
Was he MAD as heck.
I used it as a test in case I ever was confronted with a bigger infringement.
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Martin Pearson

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Post Tue Jan 28, 2003 9:21 pm

Thats very interesting Peter, we have had some discussion on copyright before, and I dont think we really reached any conclusion. To know that someone has actually been to court over it and won is quite refreshing. I have seen a few of our designs on vehicles/facias and we didnt do the jobs. Its always annoyed me that someone could take your visual to another sign company and they would do the job a few quid cheaper. Especially as we always do a few different options for customers so they have some sort of choice. They come in, we talk over the various options and they decide which one they like the best. On occassions we have printed them all out so they could discuss it with the wife or a partner never to see them again.
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looksteve

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Post Tue Jan 28, 2003 11:02 pm

Hi chaps, sounds like you should all pay in a small amount to fund a solicitor to draft a contract document, that says the prospective client should sign to say that all artwork/design by you is your copyright and property and if it is taken and made elsewhere they will have to pay for the rights at £75 (or more) per hour or something like that. It would be good business practice anyway (very profesional, like dont waste my time!). Would'nt it be good to charge a small deposit upon the first talks about designing a sign for them anyway, perhaps based upon the rough estimate of the size and approx cost ie £150 sign £25 deposit £2000 sign £75 deposit and if they agree to go ahead with your design upon agreement signed they get say a 10 percent discount on the overall price (not including vat) that you loaded into the price anyway. Or something like that after all you dont get ought for nought! do you. This sort of happened in the plumbing/heating industry where you have to pay a call out charge even if they dont do anything.
just a few thoughts
regds steve
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TonyDwyer

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Post Wed Jan 29, 2003 12:08 am

unfortunately the trade that we are in, is quite harsh to say the least. if a customer needs a sign for the front of his shop for example, quite often they are not sure how they want it to look and that is where we come in!
Like martin says normally a couple of designs are drawn out and then they choose which they prefer or want to modify. but the thing is, its like anything. if you wanted a fence put up in your garden for arguments sake, you would listen to the first company that arrived to find out how they will go about doing it, but would get other quotes and probably go with the cheapest.

someone has to be first in the line doing all the donkey work for others to profit! thats sometimes how it happens. it has happened to us on numerous occasions.

perhaps we should say to the customer that there is a £15 artwork charge for designing the sign regardless if you get the job or not. But will they just walk away and go somewhere else?

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