Tuesday, April 24, 2012

Home Improvement Stores: Are They Really An Improvement?

     I was in Lowe's the other day looking at pre-finished flooring trying to compare their off-the-shelf products to another company that I like to use, Lumber Liquidators.  I was checking out the open boxes and inspecting the individual pieces, trying to eyeball how clean, straight and consistent they were so I could approximate the actual waste expected per box, then it hit me.... What the hell am I doing?
I mean that in the nicest and broadest senses of the words but seriously, what the hell was I doing?
I know so many hardwood flooring suppliers, why am I here doing renovation recon?
Was I getting paid to investigate these materials? No.
Do I gain anything from this process? No, well ...Yes. I gain the advantage of knowing what products are available to my customers and at what price.
Does this knowledge make me more money? This is where it gets tricky...

     There was a time, not so long ago, when their wasn't such a thing as a Home Depot or a Lowe's. There were local supply houses that contractors would order their materials from. The thought of a homeowner coming to a supply house to investigate pricing on flooring, or furnaces, or roofing materials wasn't unheard of... but it certainly wasn't a common strategy. As a matter of fact, most supply houses used to offer slightly reduced contractor pricing to try and cover the costs of estimating, ordering and delivery that contractors have to do on a daily basis and give contractors some room to breathe just in case an overzealous homeowner came in looking to beat down a builder.

     Now things are differen't. A homeowner can walk into a Home Improvement center and casually stroll through the aisles, gaining vast amounts of information about the prices of available materials for their homes. They can even casually glance at the bannered pricing campaigns that say things like, "Whole house carpet installation for only $37.00!" (I bet you think I made that up, I thought you might. Here's the ad from 2 seconds ago): 



Let me stop here.
Does anyone really believe that an entire house can be carpeted for thirty-seven dollars? I mean, seriously... even if only two guys show up to do the install and they only get paid $10.00/hour and somehow manage to carpet and clean up your whole house in an 8 hour day.... that's still $10 x 8(hrs) x 2(guys)= $160.00.... and that doesn't cover any of the delivery or fuel expenses. This math isn't adding up.
First of all, there must be a tremendous mark-up on the carpet you're buying for them to be able to offer this service.
Second of all, catch words like "Basic Installation" usually mean things like
  • You want us to take the old carpet out? That's extra
  • You want us to dispose of the old carpet? That's extra
  • You wan't the old, moldy & stained padding removed from under your carpet? That's extra
  • You want new padding installed? That's extra
  • You have stairs you want carpeted in your house? That's extra
  • You wan't us to walk up those stairs to carpet your second floor? That's extra
Basically speaking, nobody ever qualifies for "Basic installation"...

What's difficult for contractors is that most homeowners never get to that stage of questioning. They see a sign that says "Whole house carpet installation for only $37.00" and often call a contractor saying... "I've found the carpet I like and know the price I can buy it for. Can YOU carpet my whole house for $37.00?"        The answer, of course, is No.

Let me come right out and say this: No professional can carpet an entire house for $37.00.

     I don't care if your house is 15 feet long x 15 feet wide, one room, no kitchen, just a bed on the floor with a hot-plate, a bag of stale Cheetos and a sleeping bag....  It'll cost more than $37.00 to have someone install your flooring. I say this so that homeowners can have a more realistic expectation of what a good contractor will cost. 
     As a matter of fact, I'll drop this little tid-bit of advice out there to chew on... in most cases, expect to pay at least as much for labor as you do materials. Sound crazy? Let me blow this by you: If you find an Andersen Frenchwood patio door for $1,000.00 that you'd like to use to replace the sliding glass door that's falling off of your house? Expect to pay at least that much in labor to remove the old one, prep the opening, install the new door and remove all debris.
If you find a good deal on pre-finished 2 1/4" maple flooring at only $3.25/square foot? Expect to pay all of that per square foot in installation costs and even more if there is a floor that needs to be removed before this new-lovely can be installed.

     This is the real world, and sometimes I think people just love the idea of a great deal. They have learned NOT to believe the car commercial that says, "You can be driving this car for only $37.00 a week!" because many of us have figured out that you have to put a significant amount of money down... then qualify for a very specific set of credit terms... then opt to buy a very specific vehicle that often isn't available once you've jumped through the first two hoops bringing that $37.00/week purchase right back to a more common $385/month car payment.

     Which brings me all the way back to Lowe's, staring at flooring, wondering if this is the right product for my customer...
Why am I doing this? Because I want to have the most informed answers for my customers.
Does this pay off? It does when my company is hired to do a job because we know more about what's available and have advice on product lines.
Has the advent of warehouse home improvement companies made contracting more difficult? INFINITELY!
     Does all of this knowledge make me more money? I think you have to be able to defend your estimate prices against all competition. You have to be able to explain to a potential customer that perhaps your "more expensive" estimate covers things that would be an "extra" on another companies estimate. Sometimes, it's better to know how everyone else is doing business for no other reason than to feel confident about doing business your way.

As always, I'm Daniel and I don't model..... I REMODEL! <--- (you're just dying to click it.... go ahead, nobody's looking... I dare you.)

Cheers!

8 comments:

  1. Well it depends. In my experience it's a 50-50 thing. Some of them do help you and some are just taking advantage with their unfair prices. I've been duped a few before but I've learned some things from those experiences.

    Good article by the way.

    ReplyDelete
  2. How can i find Remodel Contractors ideas ,to make home look beautiful with bathroom remodeling, kitchen reconstruct etc.

    ReplyDelete
    Replies
    1. Well, you could start by calling yourself because you obviously posted this comment with the sole purpose of imbedding a link to your own company with the words "Remodel Contractors".
      Pssst.... Google doesn't care much about "no-follow" links. Nice try, though.
      Also, "How can I find Remodel Contractors ideas..." isn't even a cohesive sentence. If that represents the level of quality you put into your work, maybe you'd be better off calling Focalpoint Renovations

      Delete
  3. Your articles are very well written and unique.
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    ReplyDelete
    Replies
    1. I appreciate the compliment
      Best Contractor in the world <---- See? I can do it too.

      Delete
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