Tuesday, July 28, 2009

House Painting your business

Recently, I needed to have the exterior of my house painted. We looked around for painters thinking that we would find someone who needed the work in these tough economic times. We called a couple of people who had small signs at intersections and a couple of companies. However, it was hard to get them to give us bids in a timely fashion. One day, we were telling the people that maintain our yard that we were getting bids to paint the house and they said that they wanted to bid. So, we let them. The difference in the amount of the bids was amazing. We selected the lowest bid, in this case (only $50 difference) which was nearly 1/2 of the highest bid. Some people we called did not get back to us for 2 to 3 weeks after we requested a bid. Guess what? Too Late!

I hope that in your business you get bids. So many companies get used to using the same people and just call them for the job that needs to be done. There are good reasons to do this:
1. You know them.
2. You know their work.
3. You know their cost.
4. It is easier.
5. Usually, they are faster to the job.
6. They may give you terms which could be helpful from a cash flow standpoint.

Let me suggest that during this economic situation, for sure, get bids. In my painting scenario mentioned above, the bid required painting and some minor repairs and one, not so minor, repair. The people who wanted the job really came after it. Even the high priced guys. They were shocked, in some cases, when I told them we were getting bids. They almost immediately wanted the chance to "re-do" their bid. I told them that they were too late. The people now doing the work have done several small maintenance things while they scrapped and caulked my house. The same thing happened at a clients business. Upon getting bids they discovered they were, in fact, getting a good deal from their current supplier but if they had not gotten bids, not only would they have not known that but the bids indicated what the cost of doing business with an unknown might have been.

It is always worth getting bids in these times. Some ideas for bidding:
1. Always get at least 3 bids.
2. Always get an odd number of bids (3, 5, etc.)
3, Make that your bid request contains a date for the bid to be in and a date when you want the work to start.
4. Do not pay any money up front EXCEPT for the possible exception of paying for materials up front if the materials are particular to your specifications.
5. Require Workman's comp and liability insurance or make them sign a waiver BEFORE the work begins. Even for small or individual contractors.
6. Pay them when the job is complete and you have had a chance to inspect the work thoroughly.

What do you think?

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