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| Subject - bidding wars | |
| nfsus |
i worked for a company for about 5 years and quit to work for myself. since then we have been locked in a bidding war. strictly residential and mostly new houses. he finds who i am doin work for and then goes and cuts my prices. dont want to whine about it, but its gettin old. what i am looking for is a better way to bid or something. my prices have stayed the same since i started, but he will drop hi 1000 one time then 500 the next or whatever, and i think it is just to show he can. we have been doin this for a year now. he runs a company that has been here 25 years and ive been goin for 10 months or so. any ideas????? |
| MONOLITH | Jump him in the driveway with a 2x4. 
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| Mike Delaney | nfsus, What did you expect when you left his company to start your own?? And probably take some of his contractors? |
| Scott Vickrey | You just keep improving your business model and don't worry about him. He'll get bored with jacking with you. |
| MONOLITH | quote:LOL. Did you spell check this sentence? quote:This is something I haven't heard of before John. Did you actually research the legalities of this, and what rights it actually grants you? |
| nfsus | mike- actually i did not take his contractors. i found my own. i dont operate that way. i like to sleep at night. and i didnt really quit. i was going to, but he fired me before i could. actually he said "call me when you get tired of working for yourself and ill let you come back" so i was not truly fired i dont think. but i could be wrong |
| JimmyDee | quote: Good advice. Jim |
| wilkie | nfsus, The best way to win a bidding war, other than removing yourself, is not to ever bid on the same things. Meaning if you know he bids by the sq. ft. you need to bid by the drop and vice versa. More importantly, include features and options in your bids that cannot easily be priced seperately by the GC (whole house surge, mechanically interlocking generator dead front, Annual service agreement that is transferrable to new owner, etc..)Never allow your estimate to be for the same thing. It is harder for someone to compare apples to oranges. Another, equally as difficult, alternative would be to highlight your features and benefits. There has to be a reason why a person would prefer to use you versus them. You need to be able to effectively convey why you are the logical choice. Price can be justified. You can purchase a Coke for a dollar or a knock off brand for 15 cents.What's the difference. The difference is that someone has(media) effectively convinced you that Coke is a better value. Heck, you love it now. See what I mean. |
| MONOLITH | I'm curious as to how he consistantly knows not only what you're bidding, but where. From your post about him, he's obviously got quite a chip on his shoulder. One thing is for sure, as with anything else in life, you certainly don't have to take it. Become aggressive in dealing with the situation. Use the good advice given above. I have to assume that since his business is 25 years old, and yours is 10 months, his overhead is probably much higher. Can he really afford to do the jobs as low as you can? If you know for sure he is going to follow you to a particular place, maybe have a short discussion with the intended prospect, and let them know about the 'inferior company' that is doing this, and tell them whatever number he gives, you'll still beat it and provide a better service/product. Or turn the tables. Start doing it to him, with his prospects. If he can steal your work, I have no doubts you can steal his as well. Maybe he'll get the hint. The best advice above, is the one about improving your own business model. Think about how you're presenting yourself and your bid to the customer, and make sure that they will want to use you, even if you're not the lowest price. If all else fails PM me, I'll come up with the 2x4. 
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| John A. Peters | He can only do this to you on the competitive bids. He can not do it on service calls and emergency calls. Try advertising for more of that type of jobs. If you know he is going to take a job away from you could low ball it, and he will loose money, although unless he job costs he may not know he is loosing. So this plan is not a good one. You need to find our how he knows where you are bidding. Does he find out every job? _____________ Can you find out what jobs he is bidding and give him some competition. I include a (c) copy right notice on all my bids. You can hold back your price till the closing date or the last minute. If he knows abut a job you are bidding, tell the client about him and ask them to get a bid from your old boss first and that will save you some bid preparation time and that you will pass on the savings. Ask him to fax the other bid to you if it has no (c)copyright notice. You could try for jobs in the other direction from him so he has to spend more time driving. Find an inside man working for him and find out what is going on. Find out what motivates him. We need more information to help you. Do these jobs have plans? Are they inspected? Are there missing items from the plans? Is it for a General who is a repeat customer? When he cuts his price does the client end up with a good job? Does he have callbacks? You could move in to an area where he is less experienced. |
| John A. Peters | I was responding to nfsus and how he crafted his original post. Sorry. |
| John A. Peters | Briefly looking on Google I found this here http://www.copyright.gov/ from the US copyright office/ What does copyright protect? Copyright, a form of intellectual property law, protects original works of authorship including literary, dramatic, musical, and artistic works, such as poetry, novels, movies, songs, computer software, and architecture. Copyright does not protect facts, ideas, systems, or methods of operation, although it may protect the way these things are expressed. See Circular 1, Copyright Basics, section "What Works Are Protected." WHAT WORKS ARE PROTECTED? Copyright protects "original works of authorship" that are fixed in a tangible form of expression. The fixation need not be directly perceptible so long as it may be communicated with the aid of a machine or device. Copyrightable works include the following categories: literary works; musical works, including any accompanying words dramatic works, including any accompanying music pantomimes and choreographic works pictorial, graphic, and sculptural works motion pictures and other audiovisual works sound recordings architectural works These categories should be viewed broadly. For example, computer programs and most "compilations" may be registered as "literary works"; maps and architectural plans may be registered as "pictorial, graphic, and sculptural works." |
| John A. Peters | I use this one (C) 2004 John A Peters This paper is copyrighted. Show it to my competition, but only after the bid is let. It is the result of years of experience. |
| nfsus | Well I guess that more information is needed. The man did not build his business. He married into it. The old man steped back and told him it was his. He since then has torked off every employee and several contractors. The man will drive around and look for my signs, then proceed to badger the customer for his next project. When we went around last time the job was a disaster. His guys botched the job. The state poped them for a few things and they fixed them. I lost another to him last night with the same contractor. I asked the builder if he didnt get his belly full of him on the last one and the builder said he did, but money is money. My town is a small one, and word gets around. Almost everyone that uses them says the same thing, we dont like him, stuff is always messed up, but he always fixes it. If it were me I would want it right to start with, not have lots of return trips by different guys to fix it. There are not alot of builders that have not fixed themselves to the big 3 here in town, so when you get one you try to keep them. When I worked for him I have seen him loose money to lock up all the jobs he could so to keep others from getting them, so I really shouldnt expect anthing different I suppose. Guess what gets me is this guy is a deacon at one of the local churches and engages in these practices. |
| MONOLITH | Boy, you have a real winner there nfsus. I sympathize. Don't let the deacon bit fool you, there's not always a correlation between religion, of the facade of religion, and moral or proper behavior. Quite frankly, it almost seems like a direct confrontation would be necessary, but that's not for everyone. I'm a little bit of a loose cannon, so for me personally I'd grab this guy out of his office chair and put the fear of god into him. I know that's not for the casual human though. He obviously isn't going to listen to any kind of reason, so the way I see it, you have 2 choices; either simply out-perform and out-smart him, or confront him in a manner that makes him not want to mess with you anymore. |
| MONOLITH | quote: If you can't deal with him in any other manner, I would drop the signs for awhile. I'm not sure of their actual value in terms of advertising anyway (in a small town as you described), particularly if they are simply flares by which this guy follows you. Another thing to consider, is if he is speaking to your customers to underbid you, he is no doubt bad mouthing your abilities, and costing you repeat business, and referrals. You really need to get control of this situation somehow. |
| Scott Vickrey | If I was dancing with a beatuiful thing I would not be concerned with the man holding a grudge. |
| MONOLITH | But the problem is, this grudge holder is apparently succeeding at taking the beautiful thing away from him. Repeatedly. |
| kbsparky | A friend of mine got tired of having his work "stolen" from him after losing bid after bid for about $100. Seems he would prepare the bid, and then the builder would call the other guy, and the other guy would say, drop $100 and I'll do the job. So, he went out on a limb, and figured a large job in the normal way. Something along the lines of $15,000. He submitted half that on his bid. Sure enough, the other guy ended up with the job for $100 less.  Then he sat back and waited for the fur to fly! Within a month, the other guy realized he had been had, and he had nerve enough to call him and cuss him out!! My friend just sat there and laughed at him, telling him to stop participating in bid shopping, or he would get burned again!  Needless to say, he lost his "tail" on that job. 
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| John A. Peters | If the "old man" previous owner is still around you might try asking him (with out telling him who is doing it to you) for advice on the situation for "a friend in another county". You could also talk to other contractors in the area for advice with out telling the name of the person. In both cases when it dawns on them who it is maybe something will change. Your competitors will help you more than you clients. It makes them feel good to be with some one who appreciates what they have learned and only some one in the same field can truly appreciate the hard earned knowledge. Oh yes take the signs down. But how can a sign be up before the contract is signed and a deposit has been paid? |