At Tree Amigos, we’ve held plenty of discussions lately on the issue of businesses charging for estimates, which is actually a pretty hot topic right now on construction-related blogs on the Internet.
The reality for small- and medium-sized contractors like ourselves is that the initial design phase of the quote process, which typically has been offered for free, especially by larger companies, is costly, and cannot always be recouped once the job proceeds.
In larger companies, there may be salaried staff whose job is to prepare quotes and “sell” the job. These sales reps’ salaries - or commissions - are covered by profits from the jobs they sell.
If just one person or perhaps a few in a small business are trying to make ends meet, charging a flat fee for design plans is not unreasonable. It will help small companies survive in a tough market, and will help keep local people employed. It can even help keep overhead costs down, which in turn can keep prices more affordable, too.
Tree Amigos plans to begin charging a flat fee for design proposals soon.
* In a small company, the owner or partner may have to leave an existing job site to come quote on a new job. This means they are giving you their time, including fuel costs, drive time and time spent with you.
* This visit may take some time, as the contractor tries to understand what you want done, so they can prepare a design proposal that is as accurate as possible. A first visit will typically include photographing existing terrain or rooms, taking measurements and noting details, like the client’s wishlist and potential difficulties caused by fences, doorways and existing construction.
* Then, our staff member has to put it all together in a way the client will understand, so that means using computer-assisted design to create a picture so the client can visualize the project.
* With this in hand, they return to the client to attempt to sell the job, offering a series of costs that are estimated based on how they drew up their plans. It is fully understood at this point that costs may change based on changes to the design proposal, or due to difficulties encountered as work progresses. This visit means more time for our staff member away from existing job sites, more drive time, more fuel costs, etc.
In companies where free design estimates are offered, this is the point at which a contractor begins to lose money on this job. If you ask us to quote, but decide you want to hire a different contractor, or perhaps proceed next year instead of this year, your project may be awarded to someone else, while we have done the design work for you. It is one of the main reasons why small businesses need to charge a fee for design proposals.
That’s why requesting a flat fee for a design proposal makes sense for us. It will help keep us working and lower our overhead costs, even if we aren’t awarded the contract for your project. If you do hire us, the flat fee for design will be subtracted from your final bill. That’s only fair.
Keep in mind, there are always times when a quick estimate, for a simple job, like arranging lawn maintenance or planting new shrubs, will be free. But for bigger jobs, Tree Amigos promises as detailed a job proposal as we can manage, which means time spent with the client to get things just right.
Also, there are certain trades in which “free estimates” are commonly offered - like with roofing companies. A representative will arrive at the home, make measurements and then leave to write up a quote, which sometimes, they can do on the spot. For a company that only does this kind of work, the costs are fairly easy to figure out, based on the materials required. Such a company can produce a quote that covers the initial visit, the labour of the people who will work on the roof, the materials’ purchase and delivery costs, and costs of cleanup, including removal of the old shingles. Since it’s what they do all the time, they will be able to fairly accurately show these costs in the quote.
For companies like ours that do renovations, new construction and act as general contractors, the old “free estimate” is just no longer possible. Because we are competing for your business, too much work is involved in the initial design phase for us, and other companies like us, to be able to give it away.
If you are planning to have us come quote on your outdoor dream room, it will help our staff member if you know exactly what you want done and offer your ideas in writing, making the quote process a little more efficient for them.
The most important thing to remember is to ask questions when you book that first visit. What constitutes an estimate, and what is the fee for the design plan? What about for fees for changes to the design plan, once work has begun? The more questions you ask, the more answers you’ll get.
We can’t wait to answer them all. Why? Because it’s in our discussions that we’ll begin our great contractor-homeowner relationship.
Got questions? We’d love to explain our quoting and design process to you. Contact Tree Amigos at 905-937-5353. You can email questions to firstname.lastname@example.org, or fill out the page to request a quote for services.