Whether we realize it or not, we manage financial risk whenever we take the time to get multiple price estimates from competing contractors. Those who do often get rewarded for their efforts.
As for those who don’t, well … they often end up getting burned.
I learned that lesson the hard way last month after I stupidly decided to forgo the estimates and award a backyard hillside renovation job to the guy who cuts my lawn.
The job wasn’t technically difficult; it consisted of finding and fixing a leaky underground irrigation pipe, weeding, and then laying down several inches of decorative bark to help retard future weed growth.
After explaining what I wanted to do, and taking some measurements to calculate the total area he would be renovating, my lawn guy assured me he could do everything for $1000.
“A thousand dollars?” I said. “That seems kind of high.”
“Considering all the bark you’re going to need, and the time it’s going to take to weed the hill and fix your leak, that’s not unreasonable, Mr. Penzo.”
“Well, Romero, I’m not willing to pay that much.”
After thinking things over for a few seconds, Romero said the best he could do was $800: $150 for the weeding, $400 for the bark, and $250 for fixing the leak.
For some reason, I accepted his offer. I can only assume it was because, with hay fever season around the corner, I was eager to get rid of the weeds as soon as possible.
Anyway, the next morning, I was at work when I got a call from the Honeybee. “Romero finished fixing the hillside.”
“What do you mean he finished?” I said. “It’s not even 11 o’clock. What time did he get there?”
“Eight.”
“What the … ? Put Romero on the phone!” I shouted.
The next sound I heard on the other side of the line was Romero’s cheerful voice. “Mr. Penzo, if you ever need any other side work done, you let me know! You’ve been very good to me! Thank you.”
Uh oh. At that point, I realized I’d probably been had.
“Romero, did you find the leak?”
“Oh yes!”
“Did you weed the entire hillside?”
“Yes, yes!”
“And you laid down all the bark?”
“Yes! It looks beautiful!”
Uh huh.
When I came home, I discovered that the irrigation leak turned out to be a relatively minor fix that even I could have done.
I also noticed that the hillside wasn’t weeded to my satisfaction; in many places the decorative bark was simply tossed over the wild grass.
So with a lump in my throat, I searched the Internet and got a general estimate on labor and material costs for placing decorative bark on a residential hillside. Um, I clearly overpaid for that too.
Of course, all of this could have been avoided if I had only taken the time to get quotes from multiple contractors while keeping these tips in mind:
Do your research! Knowledge is power. So prior to getting any bids, educate yourself; scour the Internet for available options and general cost estimates. Also, nothing beats a referral from a satisfied customer, so ask your friends and neighbors for contractor recommendations. I could have saved at least $100 on the bark job alone if I had done my due diligence.
Know what you want. Clear communications are important for ensuring accurate estimates. Setting firm requirements prior to asking for contractor bids is not only the best way to avoid overpaying for a service, but it also helps protect you from becoming a victim of bait-and-switch tactics.
Ask questions! Remember, you’re the boss! So protect yourself from being upsold on products and services you don’t need by challenging contractors on the services, materials and products listed on their estimates. Don’t ever be afraid to ask about cheaper alternatives, and the impacts of using lower-quality parts, or less-frequent servicing. I could have saved money by asking Romero to explain the basis of his estimates — especially regarding the irrigation task.
Choose your bidders wisely. I don’t care if you have a preferred contractor — get at least three estimates to keep them honest. And keep in mind that accepting a slightly higher bid from a reputable referral may make more sense than a lower bid from an unknown entity.
Get your quotes in writing! A verbal estimate is only slightly better than no estimate at all, which is why unlicensed contractors and con artists prefer them. Always get a paper estimate for your records and make sure it’s as detailed as possible.
Always compare apples-to-apples. It’s impossible to accurately compare bids if they consist of vastly different services and materials. Unscrupulous contractors usually give low-ball estimates that don’t include incidental costs like demolition, disposal and delivery expenses — so verify that the bid you’re given includes everything needed to complete the job.
I eventually got Romero to come back and properly weed the hill but, needless to say, I learned an expensive lesson: Before hiring any contractor, always get multiple estimates.
That is, unless you’re the type who’s allergic to saving money.
Photo Credit: Amit Patel
$800 for three hours work, I’m in the wrong business…
Me too, Matt.
In all honesty I don’t think you got ripped off. The leak could have been anything, that was a complete unknown. If I had dollar for every “minor” repair job that I started that ended up taking more than twice as long as expected, I wouldn’t read your blog.
You could be right, mb. But I still feel like I got ripped off for the leak.
He’s my regular lawn guy, and as such I expect him to cut me a little slack. In the end, he will end up sacrificing long term earnings for short term gain because I am going to eventually replace him the first chance I get.
Len, I’m a skilled handyman with a broad range of experience and a record of professionally completed jobs. I hear you pay extremely well and am willing to do work for you….. Just kidding. I think Romero uses the auto repair industry’s method of estimating a job. The book say’s 6 hours so that’s what we charge, even if it only takes us 15 minutes!
ha ha! Well, I paid extremely well for that job.
I’d love to see Romero’s price book, but I think it’s all in his head.
@mb: I completely disagree about the leak. If it took Ramero only a few minutes to fix the leak, and there wasn’t a $200 part involved in the repair, he should have backed off a bit on the $250 charge. That is highway robbery.
Which is why it is important to get a detailed estimate!
I certainly would have. I used to do computer repairs for a local pawn shop. They called me in once to fix a touch pad on a laptop, and I used the hotkey to toggle the pad on/off. I tried to get out that day without getting paid, but they insisted I take a movie anyway.
Len, I’m surprised that you being an engineer would fall for a verbal description and estimate! 🙂 I also am an engineer and we always provide detailed specification to suppliers for our components. I started doing that same thing for my house. We recently decided to a 3 season porch onto our house and I wrote up a specification for exactly what we wanted down to the type of plugs and switches. Got several bids and selected one (by the way not the cheapest). When a truck delivered 5/12 pitched roof trusses instead of the 7/12’s I had specified for the roof I called the contractor. It was “Oh yeah, I always do 5/12’s but your right, I’ll take care of it”. No problems. It always try to be there when the work is done as well. A written description of what you want and expect eliminates any questions.
Great advice, Rick. And you are absolutely right about writing down exactly what is expected. I usually do practice what I preach with respect to the estimate advice I gave above. But I got lazy and also put a little too much trust in Romero, since he has been mowing my lawn for quite awhile.
When I first moved out of home I got stung by a smooth talking sales man to do a patio cover for our house. He showed me multiple quotes through his company and before you know it I thought I was getting a good deal and signed up. A few months later our neighbors got a similar patio cover and ended up paying about $1000 less as they shopped around.
There are a lot of points for consideration here, but I think the most valuable lesson we can all take away from this is that if you have a trusted gardener, electrician, plumber, or whatever, you should always get multiple estimates just the same. It’s too easy to bypass the bidding process when you have a trusted guy you use to fix things around the house.
You nailed it, Jason.
My post today is about how we finally chose a roofing company to install our roof this spring. We did get multiple bids, and that’s a good thing because the first one we got was 85% higher than the price we ultimately agreed to pay. Sounds like you could have received that much of a discount (or more) if you’d have done your homework. Always lessons to be learned!
Hey, good post! For those who are interested, here is the link:
http://www.moneybeagle.com/2013/03/we-decided-on-a-roofing-company.html
Thanks for sharing your insight, Len – sounds frustrating. Good luck in the future.
I once paid for an oil change at my car dealership when I was having some warranty work done. I had no idea that they charged DOUBLE what the local oil change shops charge but I didn’t bother to ask.
I am trying to buy a new kitchen window and the quotes are giving me a headache. I think some insulation taped over the existing window and a sheet of plywood hammered ever that would fix the problem for less than one hundred bucks.
The effort of getting at least three quotes will be well worth it in the end, Jane. Good luck with your search.
Ouch. I have been in this situation before and have learned my lesson. I always get competing quotes because I can pin them against each other and it gives me a better view of what to expect. Sorry to hear about the expensive lesson.
Playing one quote off another is when the real fun starts! A coworker shared a really interesting real-life story with me that I will be sharing in a post next month. In a nutshell though, he played two competing contractors off one another. The competition was personal too, because the one guy originally worked for the other — so they began ruthlessly under-cutting one another just to make sure the other guy didn’t get the job. When it was all said and done, he got his job done for less than half the original estimates.
That is a painful mistake… but something I probably would have done as well if I was already working with the Guy. Thanks for sharing because now I wont make the same mistake!
I don’t think you got ripped off, Mr. Penzo. Without Romero, this blog post wouldn’t exist.
Lets say that over the next 20 years, this post adds a negligible amount to your web hosting bill and garners a million page views. Assuming a $1 eCPM, that’s $1000 that this article made for you.
Maybe you should give Romero a call…
Um, Tom … “Mr. Penzo” is my dad.
Okay. Let me know if you need a new gardener, Larry.
I almost learned the hard way myself because I didn’t do my homework and relied on references alone. When it has to do with home maintenance we always get as many quotes as we can before we make a final decision 5-7 at least. I learned the cheapest quote doesn’t mean they will do the best job. It is worth investigating if it seems too good to be true. Most times it is. I like to meet in the middle with negotiations if I can.
Another thing is that since everything is on the Internet nowadays, you can find an instructional video on anything thus being able to do the work yourself and all it would cost you is whatever how much the material is.
I can see where you trusted him to give you a deal since he mows your lawn. Boy were you wrong! I had a pipe burst on my front lawn. I opened my curtains as I normally do each a.m. and imagine my surprise when I saw water gushing up! I called the City and they told me it was my problem not theirs (naturally), but they said it’s an easy fix. I have 0 experience with this kind of thing so my neighbor came to my rescue and fixed it for me. He’s a perfectionist, so did some extra digging and cut some tree roots in the area. Anyway, I went to Home Depot and got a $50 gift card for him and put that in a thank you card that I wrote.
Hi Len,
You didn’t say whether you gave him the total $800 in advance. If you did, that was bigger mistake than anything else.
The landscape and tradesmen guys should be in a position to have the financial resources to start working.
At the most, you could have given him half in advance and half when the job was done to your satisfaction.
I didn’t give him any advance money.
Unless it is an outright emergency, I do not see why anyone would not get multiple quotes. Especially in this economy.
Len, your time is worth money too. If it is not a large amount of money then I don’t usually worry about it too much.
How much time does it take me to find other contractors, schedule them, explain the problem, get quotes, pick one, get them out to do the work? Then wonder if it’s going to be done right…?
I take care of nine apartments/houses. Chasing after contractors and bad work can be an extraordinary time sink. I learned the hard way there is no ‘cheap’ work. You absolutely get what you pay for one way or another.
But at the same time, my chosen contractors are honest and will give me a break next time if a project turned out to be easy this time.
See if your lawn guy becomes more generous with you in the near future, then decide his ultimate fate.
I think the real rip off is the fact that you have a lawn guy in the first place…what the heck? You’ve got kids don’t cha? According to my dad, that is why he had kids in the first place…so he had someone to mow the lawn–tee hee! I sure miss that man!
I guess we all have our priorities…I happily mow the lawn each week so that I can spend my money on more tangible items.
Regardless, I do love your blog Len!
You’re right. My son used to do it, Nina. But the quality of his work was pitiful — and I just got tired of making him redo it; it was driving me crazy! He still has other chores, like picking up the dog doo — and now with two dogs, his workload has doubled — taking out the trash, doing his own laundry, and other odd jobs.