How are you dealing with customers supplying their own equipment/parts?

[ZeroCool]

Hello all, It may be that I have just seen a bad run of this, but lately every building I seem to go into they try to supply all their own parts and equipment. Its everything from 500 ton chillers, to automation controls and lol even refrigerant. I get calls from techs that say a customer wants him to install his gas into a Liebert that is low.

I told him not to its a violation of tracking procedures at our company for refrigerant usage. I know its a huge liability issue to use someone else s parts that come from parts unknown. I know you can stipulate that there is no warranty on that part but we all know that there are things that will bleed into other issues that are gray areas you or your company doesn't want to be in.

Understand that these are Class A office buildings, leading communication/financial companies and such... not no name companies.

I for one am turning it down. If they want our techs or our pipe fitters, programmers, it will be the old fashioned turn key type of work. I got a really, really bad feeling this is here to stay and get worse.

[Damien]

Not near the level that you deal with but I had a customer call that wanted us to install a thermocouple from Ace Hardware.

She ask how much and I told her $85.
She than told me she watched a video on YouTube and it looked like a quick procedure and implied I should charge less if it takes 20 min.

Then she asked me if I could pick up the part at Ace, bahaha!

[flange]

There are many, many reasons customers want to do this these days, and every one of them is money. you can look at it this way, you can take their work, or let someone else have it. The thing is, it really depends on your situation, history, workload etc. For commercial properties, where are they buying the parts? Simple, your vendors are selling direct for more money to the end user to keep their doors open.

As far as installing, we do it, with express policy, no warranty, end of story. Its rare though, when we are asked. I usually go have a discussion with them, explain the cost of doing business, and then ask why they want the responsibility of stocking parts, providing their own warranty, etc, when its easier to trun key it to us for not much more money. Usually when they find out that their buy price isnt much less than our sell, it stops the bs. The only one who isnt happy is the wholesaler selling at list instead of list minus your multiplier.

Business is business. If you are swamped its one thing. If you are barely keeping your doors open another. Your labor rates should reflect all costs of doing business, plus profit/overhead. If you can get that instead of turning away work, maybe its worth it. The tides will always change, its just a matter of time. When they realize all the effort it takes to save four dollars, it just may change itself.

[freemind]

There are many, many reasons customers want to do this these days, and every one of them is money. you can look at it this way, you can take their work, or let someone else have it. The thing is, it really depends on your situation, history, workload etc. For commercial properties, where are they buying the parts? Simple, your vendors are selling direct for more money to the end user to keep their doors open.

As far as installing, we do it, with express policy, no warranty, end of story. Its rare though, when we are asked. I usually go have a discussion with them, explain the cost of doing business, and then ask why they want the responsibility of stocking parts, providing their own warranty, etc, when its easier to trun key it to us for not much more money. Usually when they find out that their buy price isnt much less than our sell, it stops the bs. The only one who isnt happy is the wholesaler selling at list instead of list minus your multiplier.

Business is business. If you are swamped its one thing. If you are barely keeping your doors open another. Your labor rates should reflect all costs of doing business, plus profit/overhead. If you can get that instead of turning away work, maybe its worth it. The tides will always change, its just a matter of time. When they realize all the effort it takes to save four dollars, it just may change itself.

Great answer, IMO.

[John Markl]

Hello all, It may be that I have just seen a bad run of this, but lately every building I seem to go into they try to supply all their own parts and equipment.

Come Easter Sunday morning....walk into Cracker Barrel with a dozen eggs and a pound of bacon....

Ask them to cook you breakfast.....

[zw17]

We had a customer buy 1200 pounds of 134A and ask us to put it in...

If we didn't do it you had best bet our competition would have.

Labor was billed at a premium and hopefully they never fixed the leak properly so they can buy another 1200 pounds.

[ZeroCool]

Come Easter Sunday morning....walk into Cracker Barrel with a dozen eggs and a pound of bacon....

Ask them to cook you breakfast.....

LOL, that's what my friend said. "Ask him if he takes a steak to Long Horns"

It just seems wrong to blow off work in this economy. We stay very busy (Thank Lord) but I really hate it for the next generation if this is the way it goes. You hate to not help people but one customer bought their own 50 HP motor for a cooling tower and asked for me to bid on installing it. I looked at the motor and saw it was the wrong type for a cooling tower, didn't say anything to see if my competition was smart enough to figure it out. I passed on it. They didn't lol, it lasted three weeks before the water destroyed it. It was so bad that it couldn't even be rebuilt. So that was a multi-thousand dollar wipe.

Really feel for the vendors locally too. All this equipment is coming in from another territory and they get stuck processing a warranty on equipment they didn't sell. I am almost positive its getting illegal especially on refrigerant bearing equipment and train of ownership. I would not want my EPA card tied to refrigerant being shuttled around to God knows where. An audit comes in and you have explain all that.

I know it all revolves around money and peoples budget. When you see fortune 500 companies not repairing one of two chillers in a facility and life saving equipment not being fixed in high rise buildings it makes me kind of sick to my stomach. I really try to keep our company name out of that ordeal. You know when the buildings sell or the engineers leave and the new folks come in they don't say "We tried to save 10% on a repair and it back fired and caused more damage and Company X tried to warn us." They just say Company X did this repair and it was wrong. Then you have a Property management company or an investment group with a bad taste in their mouth for your company.

I guess time will weed this out. Just felt like venting lol..

[John Markl]

I guess time will weed this out. Just felt like venting lol..

There could be cases in commercial work, where the customer will demand to supply refrigerant, parts, etc....It's up to you whether to accept that or not.

That is part of the reason I got out of supermarket rack work. The stores wanted to supply all the refrigerant, allow a 10% mark-up on parts, and to pay $60.00 per hour for labor.

See ya.....

[hvacker]

I worked at one of Intel's expansions. They bought all their equipment direct from the manufacturer. It's not just the HO's doing it.

[supermep]

Been running into this a lot ourselves too. Got called out on a unit estimate to find out the customer had the new units already sitting in his garage. He wanted us to install his whole split system for way less than we could afford to due to man hours/parts etc. We walked away.

[ironpit]

Had a 30 ton unit with a bad compressor last summer. Unit was getting old and we suggested replacing it. Unit had a history of problems.

Maintenance guy says to put in new compressor, only he couldn't wait for our supplier. So he goes out and gets a new compressor at a trane distributor he found on web. The guy paid Half again what we were going to charge.

We just changed out that unit a week ago. All that money for a new 15 ton compressor last year down the drain . Maintenance guy knew best.

[JoeBackflow]

I do it this way:
If they are a great customer, consider it. (But then, great customers don't do this)
If it is still profitable for you, do it. (It seldom is)
If you do warranty work on THEIR PARTS, you're nuts. (Tell them you won't IN ADVANCE)
If you don't think the thing they want you to do is correct, ethical, or safe, then click "Inactive" in your customer database and move on.

I would much rather stay home with my wife and kids and make no money than go work for a P.I.T.A. and make no money.

[JoeBackflow]

I forgot! I got a call from someone I know yesterday. He is having trouble with a bar he services. The bar owner said he will buy a mini-split and he can install it. The tech told me "I usually charge $700, but he's a great customer, so I'm gonna charge him $400." That's for a condenser on the roof and a condensate pump install. I don't know about elsewhere, but that's about what it would cost me to send a tech there for the day. No thanks. Maybe he feels bad because he installed an A-coil and condenser that doesn't work. (See "Sizing Retrofits" for that story)