Alot more competitition out there?

[xe1000]

I noticed in the last 6-months alot more competition out there, guys starting there own busineeses, all kinds of things (the big one that pisses me off I mean how cheap, not having commercial plates, have van, shelfing, ladder racks etc.) but have residential plates on ven to save, so instead of paying $140 year, its $140 evey 2-years. Also I dropped my price on change outs by $250, I feel after paying taxes its really about $162 Iam loosing, and I now give 2-year labor warranty (not thru any maufacturere either) MY LABOR WARRANTY. One devolopement I do work in 400 condo's I have over (had )325 of them, see more and more new trucks, also one local contractor who has been around for about 30 year (used to build his own condensers, from scratched to save $$$, known to be cheap, cheap, cheap price wise, but a butcher, he was using Goodman, switch to Coleman Evcon, he uses saver stat? t-stats which I think are junk, and he uses a flex boozka, his sons work for him, and one other guy, wouldnt want them in my house some long hair, sticking of booze and weed, no teeth, but price wise hes cheap. He goes to the devlopement I do and buys the (his shop 1/2 mile away) buys the manager, and assistent manger (woman) gift certificates to Filenes for $200 a pc. and asks can he be on the list of contractors that goes on the monthly news letter the assoc. sends out every month, theres 3- contractors on list including me, but when someone has a problem from condos with a/c, or heat pumps, they tell them out of the 3 Iam the best bet, the h.o.'s tell me this, when they call, they say they called offfice and I came highly recccommended, (its good because its all referral, not by knowing anyone) Ive been doing most of wor here , but now starting to get a little nervous, everything at the age of replacement especially the 175 heat pumps there 1989, and with new 13 seer, JESUS! Its amazing what some guys do, like I said here in Boston, its getting very, very competitive, lots of guys starting out on own, scary.

[Dad]

Here is just a short thought…

If guys didn’t drop their pants so low just to get the business then they could afford to pay their techs what they are worth. Then the techs that are doing your service and install business for you won’t quit and start their own and undercut you so often.

[dpatty]

Kinda worries me to, since getting my lic about 20 others have started up new companies and the area was already getting saturated. Sometimes I wonder about the wisdom of starting my biz if anyone with a set of guages, a propane torch and a mini van is going to be my competition. I planned for many things when I got started but I never though I would have to compete with companies that charge $30 for a service call and replace a contactor for a total bill of $45. I wish these guys would hurry up and go broke.

[bootlen]

Originally posted by xe1000
one local contractor who has been around for about 30 year (used to build his own condensers, from scratched to save $$$, known to be cheap, cheap, cheap price wise, but a butcher, he was using Goodman, switch to Coleman Evcon, he uses saver stat? t-stats which I think are junk, and he uses a flex boozka, his sons work for him, and one other guy, wouldnt want them in my house some long hair, sticking of booze and weed, no teeth, but price wise hes cheap. He goes to the devlopement I do and buys the (his shop 1/2 mile away) buys the manager, and assistent manger (woman) gift certificates to Filenes for $200 a pc. and asks can he be on the list of contractors that goes on the monthly news letter the assoc. sends out every month, theres 3- contractors on list including me, but when someone has a problem from condos with a/c, or heat pumps, they tell them out of the 3 Iam the best bet, the h.o.'s tell me this, when they call, they say they called offfice and I came highly recccommended, (its good because its all referral, not by knowing anyone) Ive been doing most of wor here , but now starting to get a little nervous, everything at the age of replacement especially the 175 heat pumps there 1989, and with new 13 seer, JESUS! Its amazing what some guys do, like I said here in Boston, its getting very, very competitive, lots of guys starting out on own, scary.

================================================== =========

Don't lose any sleep over that kinda stuff. It's job security. The one who lowball take shortcuts...they have to to work cheap. And you know where shortcuts lead to.

If you are honest and do a good job, all those guys are to you is job security.

[Diceman]

Lot more around here too. Our country is becoming service oriented, most Mfg jobs are leaving to go to other countries where corp's and stockholders can make higher profits........and they avoid taxes here too. So that leaves us basically with service, from Micky's D's to rug cleaning to HVAC.

[cracker]

Welcome To the A/C Business......Hold True...You Can;t Redo Yesterday.....But When The Ball Comes Around Don't Forget.

[Dad]

How true, how true...

What goes 'round, comes 'round.

Where did you get your start?

[cracker]

1977 Carrier Dealer Black Rock Ct.

[xe1000]

so are any of you self employeds lowering your rates, or your prices (when it comes to change outs?) Another thing in Jan. with new 13 seer I dont know what I will do, Iam a 1-man operation, usually a change out was great change condenser make some $$$$ and go in 1/2 day. Now the indoor also, I dont know how Iam going to do it dont have the $$$$ to hire someone fulltime and then take time to train them?

[Irishmist]

I would say, when you figure out how to give something of value away for nothing, you will cease to have these competition problems.

I am interested to hear how you do this though.

It's tighter and tougher everywhere. THAT my friend, is the reason we have to do our job better, and provide something MORE than low price.

[Green Mountain]

Guys I have been through this a few times since 1971 when I first started a business with another guy.

Business is a constant learning experience. If you pay attention to the business news on TV. (The cable and ETV channel not just the blurbs you get on the 6 o'clock news). Then you will see that what is going on in the National scene does really effect your business.

Pay attention to "housing starts", "interest rates", unemployment percentages, desposable income. These things affect your little business as well as big business. If you can read the signs then you are like an indian scout hiking through the woods.

My sales are a little shakey this year as compared to last year's. Last year people were spending like drunken sailors. This year interest rates are up. People are a little jittery. My cost of labor is down (no overtime) and my cost of material is down. So the profit is up over last year.

I would say just watch your spending right now. It is not a time to "down size." Instead of buying 3 filter-driers only buy 2. Call around for the best deal on refrigerant. Shop a little if you get a job. Just don't buy because it is convenient to get everything from one vendor.

And always remember-- Nothing is as bad as the DEPRESSION of 1991!

[Diceman]

After the steel mills closed here many years ago, all the mill hunkeys suddenly became furnace men....

[HeyBob]

Originally posted by xe1000
so are any of you self employeds lowering your rates, or your prices (when it comes to change outs?) Another thing in Jan. with new 13 seer I dont know what I will do, Iam a 1-man operation, usually a change out was great change condenser make some $$$$ and go in 1/2 day. Now the indoor also, I dont know how Iam going to do it dont have the $$$$ to hire someone fulltime and then take time to train them?

Actually I have raised my rates. It's easier to sell at a higher price in my area than be a lowballer.

Give the customer value, let them know what the value is and stick by your guns. Don't just write your proposal on a business card or a brochure and drop it off.

If you raise your rates, go flat rate, learn to charge what your are worth you will not only have money for a helper, but you will have money for uniforms, nice professional truck.....well, you should have that right now and everything a well run businees needs.

Don't be embarrassed by asking too much for what you do.

[xe1000]

its funny because the replies Iam getting, Iam not a low baller as a matter of fact Iam considered to be kind of high $$$$ I never had a problem with competition until about 3-months ago, I was getting top dollar, you say give them quality, Iam (bragging or you may think cocky) but one of the best and fussy contrators around, I dont cut corners, use Trane (and some will say thats why because tehre expensive, Iam a dealer and I get my equip for alot cheaper than you think, even my Trane rep. has been working with me to drop the price I pay for Trane even more, equip. witin about $200 of Goodman) but Ive been around for 20 years, things in the economy, and like I said it was never like this until now, everbody and there brother is opening up a shop trust me, there working damn cheap, hell you can buy Ruud condenser, air handler, whip, lineset, pad and condensate in a package for what you would pay for Bryant (which is cheap to buy) Trane , Carrier, York, a/s etc. but the main thing is guys are working out of vans, like I stated no lettering, no commmercial plates, station wagons, here in Boston it has not been like this since the mid 80's, I see alot of changes coming, but the thing thats hard to figure , is how the 13 seer thing will effect things. People are shopping for price alot of them, I had a nurse today make $45/hr. huge rock on hand husband makes six figs. when I told her price to replace heat pump she says is theat the best you can do? And my price was resonsonable. Trust me my friends things are changing here anyway.

[refrigeration mafia]

Your worst competition is you.

[xe1000]

why is that MAFIA

[flange]

most new guys will work for next to nothing. let them. do your installs the best you can, do your service calls well. if customer wants to talk price, be prepared to explain to them cost structure plus profit and only work for legitimate profit. the bozos will self destruct, and in turn create more work for you. for every price shopper there is someone willing to pay for quality work. dont bitch to your customers, be professional the work will come.

[xe1000]

Get this is you read my very first post reply, on 1st. page, Ive been talking about how competetive and how one co. came to developement I had with 400 condos, I was the one (thery used to go by the preffered list) who did allmost all of them, the condo owner would call office they would say to call me, well I get this nut lady her unit has a leak in the "u" bend at puncnch plate say to rplace shes forieign, gives me I dont have the $$$$ give her the bill 1-1/2 hrs. leak check clean coil, iam putting my tools in truck she locks here front door I ring bell, she finnallly answers ansd says why should I pay you for $162 doolars you didnt fix it, I say it needs replacement, 20mins. of this she writes ou check, then she calls that nite and says to me she ws alittle rude put the unit in, I say (usually get $75 dep. they cancel they loose $75) i will pick it up tommmorow, well at do it thurs. Well she calls @ 3:00pm, Iam @ supply house (NO LIE) the fork lift is just lowering it into van, I have to tell them take it out she cancelled, I drove 45mins. up to supply house 45 back. Then she told me my price was to high which I loweree for all changeout by $2000 to compete with alll other guys its so compettitive. Like I said if you read my first post reply. She said my price was to high (Its reasonable for using Trane) AND SHE GOT THE GUY THAT PAID THE MANAGEMENT PEOPLE TO DO THE JOB, whos never work up there a day in his life hes been around 35 years, I dont believe it Iam ready to throw in the towel, can work for Gas Co. as manager with my Associates Degree for abot $80,000 just look at jobs, or in town Lic. refer Tech $25-$28, Iam very frutrated talk to other self employed at supply house he says same hes been at it 8 years he says the trade is getting saturated with alot of new guys bu7ying vans and a Yellow Page AD, sorry for long post, but where is it going to end?

[bootlen]

If you can work for a company, $80,000 ain't bad for starters. I'd imagine you get bennies, too. Probably M-F, a few weekends, maybe a night here and there...sounds like a sweet deal to me (if you don't live in NY or LA or some other over priced COLA area.

[neophytes serendipity]

I wonder how many of "the new guys" just starting worked for someone else that didn't provide the tools, truck or gas, and saw some of those checks from the customers.

I would probably give it a shot, too.

If I already provide the tools, the truck and the gas, then what's left? Nothing to lose, right?