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8. The Art of Negotiating with Contractors
34 Plays1 year ago
In this episode of the Exposeco podcast, Brian and Paul dive into the often-overlooked art of negotiating with contractors. Learn how to save thousands on home improvement projects while ensuring contractors are fairly compensated, creating a win-win scenario for everyone. Discover expert tips, industry insights, and the true potential of professional negotiation to protect homeowners from overpaying. Whether you're planning a big project or just curious about contractor pricing, this episode will open your eyes to a whole new approach.
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Transcript
00:00:14
Speaker
Hey,
Introduction to Xposedco Podcast
00:00:15
Speaker
welcome to the Xposedco podcast. We're here to empower homeowners to take control of their projects and save money while doing it. I am your host, Brian, here with my co-host, Paul. Paul, how is it going? It's going.
00:00:29
Speaker
All right, it's going. Hey,
The Art of Negotiation in Home Services
00:00:32
Speaker
tonight we have a very interesting topic. We're going to talk about something that I feel like is under talked about in the purchasing process of of anything that a contractor is selling from home services.
00:00:47
Speaker
That's negotiating. So let's talk about negotiating. What
Balancing Fairness in Negotiation
00:00:50
Speaker
can we do? What are its limitations? And how do we how do we get the most from that? Yeah, definitely. There's a lot to pick apart in this in this topic. And the industry ah has so many wide ranges of of projects and pricing. And you know somebody that's done a significant amount of research on getting heating and air conditioning installed in their home, if they've had wide array of contractors in their home, they they probably have experienced a wide array of pricing so and people always ask like like I don't understand why these guys are so expensive or I don't understand why this guy is so cheap there's a lot of really good questions in that right but really it comes down to is like really what can and what can't be negotiated and ah how much can be negotiated And really, that's that's a great question. it's ah It's
Valuing Contractor Relationships
00:01:35
Speaker
a loaded question, right? Because you can negotiate somebody too much to where they really are kind of not wanting to do your project because there's they're not really making any money. And and i' I'm totally against that. I think that you want that contractor to still feel like they are able to do the job and make a little bit of money at the end of the day. You don't want to feel like, hey, you ripped their shirt off their back
00:01:58
Speaker
and you still made them work. You want them to be invested in your project so they feel good about doing a good job for you. And
Expertise in Fair Negotiation
00:02:06
Speaker
you can be a super strong negotiator and take advantage of a contractor. I think there's a lot of people out there that have those skills. But at the end of the day, do you really want to take advantage of of somebody?
00:02:15
Speaker
Whether it be a small business or whoever you're you're deciding to to have do your project, I would say no. you want You want to make sure that it's a fair deal for them, but it's also a fair deal for you. What we do when we negotiate, what we do is we make sure that you're getting a super fair deal every time.
00:02:32
Speaker
and The majority of times contractors are not necessarily giving you a fair fair deal. There's definitely fluff in jobs. And we, ah having the expertise that we have, understanding the industry, understanding pricing of everything, labor, what it takes to do jobs, and just having a good idea. It's like having somebody that buys cars at a dealership to resell them, doing your negotiating at a dealership for you.
00:02:57
Speaker
They
Strategies for Mutually Beneficial Outcomes
00:02:58
Speaker
know all the numbers. I know all the numbers. So we have an expertise that really no consumer is going to have. We can go in and we can have a conversation and be able to present to that contractor, hey, this we know this is what it cost to do the job. We feel like you know this is being overcharged and we can help you. We would like to use you, but we want to make sure that you're fair to our client. And by negotiating that that way, they feel that at least we're being fair about it and we're not going in and we're not chopping their knees from underneath them and i think that strategy is is something that should be really valued for the homeowner because look.
00:03:36
Speaker
We're not getting the project to where they feel like they've gotten taken advantage of. And we're also not getting the project where you've gotten taken advantage of. So the key is is everybody's everybody's happy at the end of the day. And the reason why we want that is because we want them to do a good job at the other day. We want them to feel good about if they step through your ceiling or something during the installation that they have no problem about taking care of that.
00:03:58
Speaker
and they don't feel like, hey look, I'm losing even more money on this project. So there's a lot
Spotting Overcharges and Ensuring Fair Pricing
00:04:04
Speaker
to negotiating and it takes a lot of skill to get to the point where you can really be fair and balanced in your negotiation and still at the majority of times save save the consumer a lot of money. Yeah, I loved your approach when you're talking about this. So many people would think, well, negotiating is just about getting the very best deal for you, like lining your pockets or keeping as much money of it as you can. But you think of it more holistically so that you're thinking of,
00:04:32
Speaker
How is the contractor going to feel working in your house if they're not making any money? We still want them to make some money. That's why they're in business. So we want this actually ultimate win, win, win scenario, actually. So it's a win for the negotiator, which would be us. It's a win for the the consumer because they're getting a fair price for the services and the goods they're purchasing. And then also a win for the contractor. They, they feel good about the project that they're gonna be working on, they're covered at every level. I feel like that's such a rarity. We're not trying to put anyone out of business. What we're what we're really trying to do is level that playing field and make sure that people can have
The Importance of Negotiation in Home Services
00:05:16
Speaker
that advocate, um that mediator. You have mediators in lots of different industries like in real estate and other ones.
00:05:23
Speaker
But here we have like a mediator specifically in an area where we can help consumers be protected and make sure they're getting a really good deal. I just think that's so valuable. And the way that you the perspective you have, I think is very unique and very healthy on that. Yeah, no, I mean, believe me, it comes from experience. I mean, it comes from being negotiated down to where you're like, why am I even doing this project? This project, I'm gonna lose money on it. And you're like hemming and hawing the whole the whole way through the project. But your integrity, you know, you want to keep your integrity, you want to still do a good job. But not every contractor is that way. It's hard to feel like you want to do a good job when you feel like somebody is like literally making you pay to do their project.
00:06:05
Speaker
um There's nothing more disheartening when when you're working hard for somebody and you're paying to work hard. I think there's there's a lot of importance there to have a balance, right? The reason why we offer doing negotiating is because I don't feel like it's balanced. I feel like the contractors are usually, there's a lot of extra that that can be in those proposals. And and you know if we come across a set of proposals and somebody pays us and they say, hey, we want you to negotiate this and we we see that there there's really no meat left on that bone, we will ah kindly just you know say, yeah we think you're getting a good enough price here and we we don't suggest negotiating this anymore because we don't think that there's anything left to negotiate other than they would be
00:06:47
Speaker
not making any money on your project. And we we don't feel like you're going to have the best experience after Expo's co-experience with that contractor. We aim to make sure that your project's going to go smooth, finish on time, and have a good experience with your contractor based on our expertise of helping you choose the right person. So if you're the consumer out there that says, hey, I just want the cheapest, cheapest, cheapest price, and you know I'm going to pay you to negotiate it, and we want it even lower than what we've already gotten it for and it's the guy's already losing money, we we wouldn't be the right fit for you because you know what? At the end of the day, you're gonna be unhappy because you're not gonna get a product reflecting a company that's ah in business making money. I think this is a new area for people and I wonder if our listener is gonna be
00:07:34
Speaker
considering like this feels like french they're speaking French to me. I have no idea what they're talking about because I understand that you can negotiate like at the swap meet or you can negotiate at a garage sale. You negotiate the real estate purchase price, but they're talking about negotiating home services like my roof that's going in, my heating and air conditioning system, the solar panels that I might have installed. Are you telling us that that is an area in which people can and do get their prices negotiated. Absolutely. I
Understanding Contractor Pricing Variability
00:08:07
Speaker
mean, a lot of times, especially even small business, they're not necessarily like precise on their pricing. They're almost they're coming up with when people say we have flat rate pricing. Well, that flat rate pricing is
00:08:19
Speaker
basically a made up number for you know situational jobs that require the worst case scenario amount of labor. So it means ah a lot more labor than maybe your job takes. And when they have flat rate, you're paying you're just paying the highest fee that they would ever have to charge to still make money on that that type of project. And then there's all the way down to the guy that's at the checkout of his truck and he looks at you know he's looking at the job and just says, yeah, I think we can do it for this amount, you know a few thousand, 4,500, 5,000. He's basically just shooting from the hip and it's based off his experience of other jobs he's done for that price. But you know is he really sitting down and actually crunching in his actual fixed labor costs, what he's paying in taxes, what what he's paying for equipment, what he's paying for everything else?
00:09:06
Speaker
a lot lot of these guys aren't doing that, and or some of the guys aren't doing that. and But the larger companies, they have the flat rate. So you're paying for the most expensive job it being done the most expensive way. So what I was getting at is neither are very accurate. And that means there's room for negotiation. And if the you know the small time guy is just throwing it from the hip, I mean, he's He's probably adding a few thousand dollars just for added fluff on there because he wants to make make extra money. And ah the large corporation has his their they're fluff built into every single price and and that's what they're going to try to charge. But those big companies, they negotiate too. They all negotiate. There isn't one company that doesn't negotiate. And I've seen a lot of these things pop up online. Get a quote in 30 seconds, just submit your name and this and that and we'll
The Role of Professional Negotiators in Cost Savings
00:09:53
Speaker
give you a upfront, honest pricing, you don't even know exactly what the jobs and totally entails. I mean, they can take some information down and get an idea of what you need, but it's not exact. And so what that means is they have a lot of fluff in there or extra to make up for any, any variables that could happen in your project. So it can, it can be not precise by any means. And with our expertise, we're able to look at the project and understand
00:10:20
Speaker
at a more precision way what that project should cost at a fair market value, not overinflated and be able to make sure that they adjust it to where it should be. It's really, really important to have those those trains set of eyes taking a look at that stuff because you never know what you're getting. I mean, and the thing is, is you can you can go fill out four or five of those online quotes. Those four or five companies could be like massive companies that all are charging three to four times what a small mom and pop shop are are charging. So that's why we're here. We're here to you know have those trained eyes of get the red flags and and say, you know stop, stop, stop. Let's go back to the drawing board and let's we think you can get a ah better better solution for your project. Yeah, that's one of the things, the upfront pricing, they don't want you to think that you can negotiate that. I think that that's part of the tactic.
00:11:11
Speaker
Like the no BS pricing, the no margin pricing, like there's a local car dealership in my city that has the no BS price. And so it's like just upfront, it's mostly so that you don't haggle with them, but you want to be able to have a conversation about the value of the service and the value of the product you're receiving. But as you noted, there's like there's a pretty big learning curve ah for being able to have that conversation in a meaningful way. If I just went up there having known nothing, call my contractor who's making me an offer for, let's say, a product for a new heater or air conditioner.
00:11:48
Speaker
Um, I'm not going to know what to really say. I might say, Hey, can you kind of discount this a little bit? Can we save some money? Oh yeah, sure. Maybe he'll say, I'll, I'll, I'll knock a hundred off. How is that different than like what you're going to do? Like if they hire exposed co, like have a professional negotiator, what's the potential? I guess is what I'm getting at, because I don't know what I would be asking for, but you would know what you would be asking for and how would you know? And how much could that number actually be? I've seen i've seen projects get negotiated by 50% and that's like not like a huge, rare situation. ah I've seen it quite a bit where companies come in so high, you know like they'll come in and they'll they're going to charge $20,000 for this air conditioning system. and Then at the end of the day, I've seen those customers get that air condition same air conditioning system installed for $10,000. That's $10,000 and you go people go man, that's highway robbery that they're trying to charge you 20 in the first place. That's that's exactly why we exist. I've seen that habitually with with contractors where they come in with a blazing high price and to see if the customer is gonna just go with it and they don't say a word and The sad thing is is, yes, there's customers out there that just go with it. They don't think twice. They just they just trust them and they just do it. and They're ending up spending an extra $10,000 on their air conditioning system. That project is $10,000. We bring that knowledge of of just knowing and being able to have the the expertise of being in the industry and and understanding the nuances to the different projects. Yeah, no, there it can be significant. And like like we said earlier, if there's no meat left on that bone, we're gonna tell you. We're gonna say, hey, you're already getting a great deal. And then you don't get charged anything from us. Because we don't believe, if if we're not gonna be able to give you any value for our service, we don't we don't believe in charging you for it.
00:13:36
Speaker
If we can't negotiate anything off, you don't get charged. is It's easy as that. So it's a win-win. I mean, there's there's no way you can lose because look, if you don't get money taken off your project, then you don't pay us a dime. And when we do take money off your project, we only take half of what we take get taken off your project up to $1,600. So if you get $1,600 taken off your project, we're only getting paid $800. That's pretty incredible when you consider the reality that somebody could say 5,000 and the maximum that we would ever make for negotiating that is 799 bucks is 800 bucks. So then there's no risk on top of it. So somebody could already get the very best price that they could imagine. Let's say they get three
The Benefits of Hiring Professional Negotiators
00:14:19
Speaker
bids. They get really nice price on that and then they can on top of that.
00:14:23
Speaker
they can go and ask us to negotiate that price and they can get an even better price potentially. And if we don't get them a better price, 100% of the money that they put in to hire us to negotiate it is all refunded. Yeah. It's almost hard to believe. Yeah, no, it's honestly like shocking that anybody wouldn't do that, wouldn't do that service because there's no reason why you shouldn't do that. And also we're giving you the peace of mind that you're getting a good deal if we don't get any money off of it. We're yeah really like, you know, letting you know, yeah, there's nothing left on this thing. Like you've really done a good job. yeah peace of mind So it's like having a peace of mind that, okay, now I feel good that no, I'm not getting like totally screwed over on my price. I mean, that's a whole nother aspect of purchasing that from us is knowing that we're going to look it over to, to see if it's a viable, you know, something that we can bibly negotiate. Yeah, that peace of mind thing is is highly valuable. It's more valuable than, I think, in some cases, the money. When you don't have to worry, am I getting a fair deal or am I getting even the right equipment? It's it's worth it in and of itself. But to add to that, it just is it's insane that you could have something negotiated by a trained professional and save money. And I kind of think that, you know, like your example earlier of the $20,000, like the bid for $20,000. So that's meant for 20,000. And then we go and negotiate is 10,000 less, that person likely just got one proposal, right? That's what the company is kind of hoping and praying that they're the first company out, they're gonna hard sell them, tell them Even some things, you know, they're going to use their sales tactics to kind of get that signed that day without any negotiation, no extra eyes on it. And if they can do that, they'll they're going to profit heavily on that sale on that install. So what we're what we're trying to do is, OK, fine. If you only want one quote, I think that that's foolish, but at least we'll we'll negotiate that. You don't even have to buy another package from us. Let us at least look at the price of that one.
00:16:19
Speaker
and say, okay, like, let's see what we can save you on this one. If you're, if you don't want to buy, um let's say one of our other packages that we take a look at your proposals and make you get more than one. And that's, that's fine too. I guess if a, but the reality is ah if you choose to do that as a consumer, your time, what's your time value? Like you're potentially paying up to five to $10,000 more for just for not wanting to do that one thing that costs you maybe an hour of time to have someone else come and bid it again with another company. um I think that the $10,000 an hour is is worth it. you know The potential cost savings is so good. Definitely to most people, if it's not worth it to you, you should just hire us and and we'll come out and get all the the proposals for you for less than that.
00:17:02
Speaker
So you know we have those customized packages that we can be very personalized. So if $10,000 an hour and you're you're making more than that, give us a call. we'll We'll take care of the whole project for you and get it figured out. But it just goes to show all right that a simple phone call to us, just jumping online and and purchasing that package is ah an easy way to to ensure that you're getting a great deal. And then also potentially saving thousands and thousands of dollars. And going to people may have gotten three bids and they're, you know, all three of them are close to that $20,000 range, but they can still get it done for 10,000. That's what people don't realize that, you know, if you get the three bad companies or three companies that are overcharging, which I'm telling you.
00:17:42
Speaker
All markets have them. They have these companies that overcharge. I mean,
Consumer Protection in Contractor Deals
00:17:46
Speaker
look, the market that I was in, there was there was a couple guys that were always for the same projects, several thousand dollars more than I was. And you go, what would you need that money for? I mean, like what? Why are you charging that? And would they still get jobs and do them for cheaper than me? Yes, they would. So it's just you know it's it's crazy. But and another thing is you got to be trained. You got to know what to look for. These projects can be confusing if you don't know what's going on. Part of what the reason why we started this is because I was i was buying solar for my my house and and I remember getting three bids and I just was so confused about the whole process of what what I was buying because these three sales guys confused me so bad. that was I'm basically in an industry that's very closely knit with solar and I still was lost. and so At that point, I was like, man, these this industry needs somebody to protect the consumer because you know what? These guys, they can just be a shark and they can they can close you and you would you would feel like you're getting a good deal. At the end of the day, you're done with the project and you're you're stuck with the solar panels on your roof or you're stuck with the air conditioner. inside of your house and you can later find out that you overpaid for that. So I don't want people to feel that way because that's a that's a bad feeling. There's a you needed the exposed co solar wing like in that moment. Yes.
Conclusion and Call to Action
00:19:06
Speaker
Every time I've ever been taken advantage of every time I've ever even had heard of family or friends that have had bad experiences with contractors,
00:19:15
Speaker
If they had ExposeCo in their corner, none of that pain would have happened. That's that's a remarkable thing to say, and it's actually a really ah really cool thing. We're breaking into an industry in a new way. So I hope that this conversation has been helpful to our listeners. It's been on negotiating, and I hope that you're ready to hire ExposeCo's professional negotiators to get to work on your proposals, saving you money.
00:19:41
Speaker
Paul, any last words tonight? Oh, I would say ah just don't trust that the number that they give you is the final number. Let us check it out. We'll get you the final number. There we go. All right. Thanks, Paul. Thanks to our listeners for tuning in. ah We'll see you next week with another episode.