Today I wanted to address something after speaking to a few tradesmen, I have dropped in the conversation with my builders over the course of a month the idea of The Consumer Protection Guarantee.
There is a universal intrigue and concern, with the 10 or so I have mentioned it to, they were all interested and everyone of them also had the same concern.
You might have guessed it from the title (Don't look at it now I'm about to tell you!) they all said how am I going to get my customer on board? It's a fair question and really with what TCPG are offering it shouldn't be all that difficult!
So as I always do I try and put myself in the mindset of the end user, I want a job doing and the builder quotes me, he mentions TCPG and that he would really like us both to be on board with no extra cost for me.
My concerns? who is this company? are they legit? Do i really want to part with a lump sum of money for someone else to judge if the work is up to standard? How do i know the person judging is qualified and fair?
Taking out what I know about the company and thinking about what my concerns would be I'm pretty sure if I had any amount of money over £2000 these are the questions that would run through my head, there pretty big concerns and most customers don't give a reason for saying "no" and to be fair who would challenge them if your job is on the line?
It's about educating your end user, addressing there concerns and bringing across that you have there well being in mind and that your proud of what you do and this is a guarantee to back your work up.....again at no extra cost to the customer, but were still not addressing my questions as the customer are we.....
Who is the company?
The company TCPG was started to combat "The cowboy builder" The guy that does a half A** job and does a runner and is never to be heard of a again, but....
It was also started to protect YOU, the honest, hard working tradesman who is skilled in there field and when a customer says "I'm sorry I know the work you've done is great but I have no money" or holds up the cash because there swearing blind you've done an awful job when it's more than up to standard!
Are they legit?
Well check for yourself, they have company registration, company address, telephone number, e-mail.
Even get them to check the company registrar themselves if they have concerns.
Do i really want to part with a lump sum of money for someone else to judge if the work is up to standard? & How do i know the person judging is qualified and fair?
Well just in case your customer still has reservations it's all conducted by an official RICS Surveyor if a dispute arises, again this is to protect YOU and the customer.
I know it wouldn't put you off doing a job if your customer said "No I don't want this free policy that your providing" but I the builder would be cautious, why would your end user say no to this? it's a policy to protect them against rouge builders and lets be honest its still a red hot subject in the media and something that the general public are more than aware of, they are more than likely than ever before to question your work no matter what the standard, I'm sure you've all come across the dreaded beast that is:- The customer that can not be pleased.
To summarise this post, your customer will need educating when it comes to TCPG don't try and force it on them because they just may have concerns that can't be over come and there still honest and reliable when it comes to paying and the last thing you want is to lose the job but really it's something that all jobs over £2000 should have.
I'll leave you with the scenario:- You do a job for £5000, you finish it and your customer isn't happy with your work, the work itself is up to the high standard its always been but your customer is refusing to pay you the money.
You have maxed out your credit account at your merchants and the next job has a start date coming up, tell me how are you going to do the next job without materials? Maybe pay with a credit card? how far away is the payday for the next job? is it going to cover your credit card bill and the bill for your merchant account? and this is just your business outgoings don't forget mortgage repayments or rent, food.....I don't need to go on but you get the idea.
Add the TCPG to the scenario:- You do a job for £5000, you finish it and your customer isn't happy with
your work, the work itself is up to the high standard its always been
but your customer is refusing to pay you the money. You contact The Consumer Protection Guarantee and they send out a RICS surveyor to inspect the work you've done and is happy with the standard of work.......The funds are paid directly into your bank account.
On with the next job then!
Take a look at how they work and then decide if you think it's a good idea, at the end of the day its your decision:-
http://www.tcpg.co.uk/
Save Build.
Monday 6 May 2013
Which supplier should i use? part 2 (Heavy building materials)
Today I will be talking about what you should look out for when it comes to choosing your merchant for Heavy Building materials.
As tradesmen the bulk of your material cost comes from heavy side building materials, it may be timber or blocks, cement & sand, regardless its the primary expenditure.
So who do you choose?
A real tough one because there are lots of factors involved, if your organised and a medium to large builder your national merchant should really be taking care of you, if your small to medium then your national merchant might not be taking care of you as well as a regional or independent, so back to the question, who do you choose?
National merchants may seem like the easiest answer, largest buying power means you get the best price, right?
I doubt it because even though the national merchants have the best buying power there treated as separate commodities, they have different budgets, different systems, different staff members the only thing they have in common is the name.
Unless you have an extremely large development on the cards the chances are the prices you get from your nationals are easily beatable by regionals and in most cases independents, there are rare exceptions depending on the staff but in most cases its the same outcome.
The regionals depending on what stage there at in regards to growth are in my opinion the best to deal with for HBM, there willing to beat prices, make a name for themselves and want the business, I work for a regional company (almost national) and even though LBM for us is slipping away i can certainly take out nationals for price, they offer little resistance and rest on the morals of "there's always someone else to spend" I fight tooth and nail for business in regards to HBM and it's rare that i will be beaten.
The independents hold a dear place in my heart and the only thorn in my side when pricing jobs is.....you've guessed it an independent, I know there weakness when they price jobs so on most occasions if a large job is being priced by the independent and me, i come out on top.
The draw back is that most sales are done at a very low sales margin because the independent has my back to the wall in terms of price, they are extremely keen on insulation, blocks & cement which is some of the very core of HBM.
If you were to ask the hypothetical question of "if i had to choose two companies to price up my job, who would they be?" I would answer the independents and the regionals, you just get a more deserving attitude from the smaller guys than you would from the nationals and when your pricing you want this attitude to come across.
To summarise this post I do have a little of a biased opinion towards the smaller guys but this is with good reason, I've worked for all three and the hardest i had to work to keep my customers happy was the nationals, I don't want to carry there attitude of "If you don't like the service and price then there's the door" I'm a firm believer of the better the service and price the more my customer will spend, this leads to a faster turn around of selling goods and the profit is made, I'm happy, the company is happy and more importantly the customer is happy.
There are exceptions in every case, your national merchant may have the same attitude as me but I'm yet to see it myself, your regional maybe having the same attitude as the nationals and your independent may just not have the buying power to compete, it's up to you to find out in your area what your suppliers can do but this post gives you the generalisation of each supplier.
Save Build.
As tradesmen the bulk of your material cost comes from heavy side building materials, it may be timber or blocks, cement & sand, regardless its the primary expenditure.
So who do you choose?
A real tough one because there are lots of factors involved, if your organised and a medium to large builder your national merchant should really be taking care of you, if your small to medium then your national merchant might not be taking care of you as well as a regional or independent, so back to the question, who do you choose?
National merchants may seem like the easiest answer, largest buying power means you get the best price, right?
I doubt it because even though the national merchants have the best buying power there treated as separate commodities, they have different budgets, different systems, different staff members the only thing they have in common is the name.
Unless you have an extremely large development on the cards the chances are the prices you get from your nationals are easily beatable by regionals and in most cases independents, there are rare exceptions depending on the staff but in most cases its the same outcome.
The regionals depending on what stage there at in regards to growth are in my opinion the best to deal with for HBM, there willing to beat prices, make a name for themselves and want the business, I work for a regional company (almost national) and even though LBM for us is slipping away i can certainly take out nationals for price, they offer little resistance and rest on the morals of "there's always someone else to spend" I fight tooth and nail for business in regards to HBM and it's rare that i will be beaten.
The independents hold a dear place in my heart and the only thorn in my side when pricing jobs is.....you've guessed it an independent, I know there weakness when they price jobs so on most occasions if a large job is being priced by the independent and me, i come out on top.
The draw back is that most sales are done at a very low sales margin because the independent has my back to the wall in terms of price, they are extremely keen on insulation, blocks & cement which is some of the very core of HBM.
If you were to ask the hypothetical question of "if i had to choose two companies to price up my job, who would they be?" I would answer the independents and the regionals, you just get a more deserving attitude from the smaller guys than you would from the nationals and when your pricing you want this attitude to come across.
To summarise this post I do have a little of a biased opinion towards the smaller guys but this is with good reason, I've worked for all three and the hardest i had to work to keep my customers happy was the nationals, I don't want to carry there attitude of "If you don't like the service and price then there's the door" I'm a firm believer of the better the service and price the more my customer will spend, this leads to a faster turn around of selling goods and the profit is made, I'm happy, the company is happy and more importantly the customer is happy.
There are exceptions in every case, your national merchant may have the same attitude as me but I'm yet to see it myself, your regional maybe having the same attitude as the nationals and your independent may just not have the buying power to compete, it's up to you to find out in your area what your suppliers can do but this post gives you the generalisation of each supplier.
Save Build.
Friday 3 May 2013
Which supplier should I use? Part 1 (Light Building Materials)
Today I will be talking about what you should look out for when it comes to choosing your merchant for light building materials (Shop floor goods).
It may not seem overly important to you if your choosing a merchant for LBM but every penny counts and believe it or not LBM does mount up and when you think about it, its part of everyone of your orders.
Just look at your delivery order and tally up the LBM and you can see that its not the bulk of the cost but its still a big part of the money that your spending.
For instance:-
3 x Packs of blocks (216)
2 x Holm sand LBB
10 x Cement
5 x Celotex 8x4 50mm
20 x Celotex 450x1200 50mm
10 x 47x100 sawn treated 3.6m
So that's an order for heavy side and may cost between £400-£600 roughly.
So the LBM for this would be:-
Mortar plasticisers,
cement colouring
fur fixes (wall starters)
wall ties
retaining clips
screws
saw
trowel
And this would cost depending on the quantities around £60-£130.
So LBM makes up between 20-30% of your spend, all subject to your trade but regardless even if we went as low as 10% of a £10'000 job it's still £1000.
So what do you look for if your choosing your merchant for the light side materials?
First off you want a builders merchant or supplier to trade on "EVERYTHING" this is extremely difficult to get this attitude out of a nation merchant, The ones I've worked in have restrictions on shop items, you name it and they want a very high mark up on about 95% of the shop items, I used to get embarrassed to serve a customer at one particular merchant because we were next to a independent fixings and fastenings shop, when one of my high spending customers has spent £2000 with me on one order and they bring a box of screws to the counter and ask "how much?" and my price was 5 times more than a stand alone small fixings shop and I was unable to reduce the price it makes you want the ground below to swallow you up!
Then there are the regional merchants and some you are able to get a great deal in for the smaller items, just be careful though some are getting a little to confident and are trying the same tactics as the nationals and believe me it will come back around and bite them on the backside, nationals can fall back on other large orders taken from there 100's of branches, regionals don't have that luxury.
Then we have the independents who i have explained before in a previous post but not in much detail, they have there feet firmly planted on the ground, with this in mind they may not be able to offer the most show stopping deals on HBM they can certainly wipe the floor with bigger greedier merchants on LBM.
Finally there is the "non traders" don't be fooled by the name, there a national but wont trade and the reason for this is? there prices are low to start with, some tradesmen I've come across turn there noses up at these guys because they feel that they as the "tradesman" should be entitled to a better deal but they wont budge, everyone gets the same cheap deal, take it or leave it attitude.
There is one final one i forgot to mention but you have to be extremely organised to pull this one off:-
The Internet!
A tough one but with technology being as good as it is nowadays and the fact an online shop can be just as ridiculed as a physical shop most are legit and the overheads are almost non-existent so the costs of running an online supplier is minimal and this leads to prices being low, down side? If you forget an item you have to wait for it to be delivered.
To summarise its a tough call but if you put the leg work in when you start your shopping you can relax a bit more when you have identified who is the cheapest and what it takes in terms of time when you have to start the process again.
A word of warning, make sure that the items your buying don't slow up the job, there is no point in saving money on LBM if the items your using that are the cheapest around and with good reason, if an adhesive doesn't stick but is half the price of one that does which would you buy? it's all to do with trail and error initially.
Save Build.
It may not seem overly important to you if your choosing a merchant for LBM but every penny counts and believe it or not LBM does mount up and when you think about it, its part of everyone of your orders.
Just look at your delivery order and tally up the LBM and you can see that its not the bulk of the cost but its still a big part of the money that your spending.
For instance:-
3 x Packs of blocks (216)
2 x Holm sand LBB
10 x Cement
5 x Celotex 8x4 50mm
20 x Celotex 450x1200 50mm
10 x 47x100 sawn treated 3.6m
So that's an order for heavy side and may cost between £400-£600 roughly.
So the LBM for this would be:-
Mortar plasticisers,
cement colouring
fur fixes (wall starters)
wall ties
retaining clips
screws
saw
trowel
And this would cost depending on the quantities around £60-£130.
So LBM makes up between 20-30% of your spend, all subject to your trade but regardless even if we went as low as 10% of a £10'000 job it's still £1000.
So what do you look for if your choosing your merchant for the light side materials?
First off you want a builders merchant or supplier to trade on "EVERYTHING" this is extremely difficult to get this attitude out of a nation merchant, The ones I've worked in have restrictions on shop items, you name it and they want a very high mark up on about 95% of the shop items, I used to get embarrassed to serve a customer at one particular merchant because we were next to a independent fixings and fastenings shop, when one of my high spending customers has spent £2000 with me on one order and they bring a box of screws to the counter and ask "how much?" and my price was 5 times more than a stand alone small fixings shop and I was unable to reduce the price it makes you want the ground below to swallow you up!
Then there are the regional merchants and some you are able to get a great deal in for the smaller items, just be careful though some are getting a little to confident and are trying the same tactics as the nationals and believe me it will come back around and bite them on the backside, nationals can fall back on other large orders taken from there 100's of branches, regionals don't have that luxury.
Then we have the independents who i have explained before in a previous post but not in much detail, they have there feet firmly planted on the ground, with this in mind they may not be able to offer the most show stopping deals on HBM they can certainly wipe the floor with bigger greedier merchants on LBM.
Finally there is the "non traders" don't be fooled by the name, there a national but wont trade and the reason for this is? there prices are low to start with, some tradesmen I've come across turn there noses up at these guys because they feel that they as the "tradesman" should be entitled to a better deal but they wont budge, everyone gets the same cheap deal, take it or leave it attitude.
There is one final one i forgot to mention but you have to be extremely organised to pull this one off:-
The Internet!
A tough one but with technology being as good as it is nowadays and the fact an online shop can be just as ridiculed as a physical shop most are legit and the overheads are almost non-existent so the costs of running an online supplier is minimal and this leads to prices being low, down side? If you forget an item you have to wait for it to be delivered.
To summarise its a tough call but if you put the leg work in when you start your shopping you can relax a bit more when you have identified who is the cheapest and what it takes in terms of time when you have to start the process again.
A word of warning, make sure that the items your buying don't slow up the job, there is no point in saving money on LBM if the items your using that are the cheapest around and with good reason, if an adhesive doesn't stick but is half the price of one that does which would you buy? it's all to do with trail and error initially.
Save Build.
Wednesday 1 May 2013
Keeping your account Clean.
Today's post is discussing the importance of getting bills paid on time and in full.
I know most of you may turn your noses up at this post but please read on and I will give you the insight on what happens behind the scene's when bills aren't paid.
We have all been in the situation where we haven't paid a bill on time and a letter gets sent asking for money NOW or.......we will send you another letter in a more demanding way, don't pay that one and we will send a letter this time.....with BOLD LETTERS and if you don't pay us again we will send you a letter this time in BOLD LETTERS and a big RED BANNER!!!!!
Finally it sends a letter with all of the above and a threat of court proceedings.
All payments and activity's have a dedicated diary section in which notes are kept, this diary section starts from your account being opened and lasts until the account ceases trading.
I will put a damage rating (out of five) next to each stage and explain what it does if you go through each step of not paying.
So lets start with your account being opened, rule of thumb you will get 30 days credit and when the 30 days are up you need to pay your bill, you will get a little bit of a cushion period (maybe a week) before a call is made from the merchants credit control if you don't pay and they will inform you that it's due and how and when your going to pay.
Damage rating:- X
The company and credit control understand that sometimes its not possible to pay on time but it will state you paid late on your diary notes, it won't worry them but it will state you paid late on this occasion.
7-14 days, So you have forgot to pay after a weeks grace and credit control have called and you haven't stuck to the date you were going to pay, a letter will be sent and another call will be made asking for a new date, this sometimes means that your account will be put on stop although its down to the credit controller and your history so far on the account, this period runs from 7-14 days without payment.
Damage rating:- XXx
Starting to become a little more serious and the small "x" is a half rating because it depends on your history so far, if its a genuine reason that you can't pay then its excepted, if you just keep forgetting they will REMIND you by just putting your account on stop.
14 days - 1 month, It means that your account will definitely be on stop with a call made every other day from credit control asking for the circumstances and if you wanted to look at part payment (this wont get you off stop but something is better than nothing in there eyes) again diary notes start to fill your account on every call made, what was said and why payment hasn't been received, a letter will be warning of court proceedings but informing you that if you make payment it won't come to that.
Damage rating:-XXXX
This will really damage your account to a point where they may think about putting your account on a "prompt stop" meaning not even a days grace, if your account is due for payment and it goes a day over then it instantly goes on stop until you pay, it takes a while to come back from this and its a case of the company wanting to trade with you but your leash has become very tight in terms of trust.
A Month - Onwards, your account will be on stop and depending at what point your paying (The longer you leave it the worse it gets) a payment towards your account might still not be able to get it trading, letters will state that the debt has been passed to the legal team to retrieve the money and a phone call will come almost daily from the legal team to chase the money.
Damage rating:-XXXXX
At this point not only will the account be passed to the company's legal team but this will effect your credit rating, even if your account does get paid and your able to start trading again, the trust will be non existent, your credit limit will no doubt be decreased and it will have a prompt stop attached to it, the only way to gain trust again at this point is to never go on stop again for the next
6 months - 12 months and if you get close to your credit limit pay an interim to bring it back down.
To summarise this post isn't a scare tactic to get your bills paid on time (although its a pain in the backside if you don't) its to inform and help you, if you hit the later stages of what i have discussed and you have a large job come up what do think your supplier is going to say when you ask for a credit increase to get the materials? It sounds silly but the diary will look similar to this:-
01/01/13:- account opened, letter sent to customer informing of this and a 5k limit.
05/02/13:- over due £3510, called customer, is going to pay in branch tomorrow.
10/02/13:- called customer asking for payment, cheque sent to us in the post.
15/02/13:- no cheque received, account put on hold, spoke to customer and asked for him to cancel the cheque and drop a new one into the branch, informed he will do it Monday.
17/02/13:- no cheque, customer not answering mobile, left message, letter sent.
24/02/13:- no answer on mobile, letter sent.
literally every detail is logged of all the activity but this gives you an indication of what happens and Carry's on this way, if you keep your nose clean then it will give you a much better chance of a credit increase.
The other thing i want to mention to finish off is communicate with credit control, DON'T LIE! if your having money trouble then tell them, they are human and you maybe able to keep your account trading until you can get the funds together, if you lie to them and they suspect it they will put your account on stop, it isn't a machine that makes these decisions its a human and although they have to follow rules there are times that they can bend them to help you out of a difficult circumstance.
As usual you have my details for FaceBook and there's always Gmail if you wish to contact me privately but if you need help or advice concerning this or anything building related then please get in contact.
Save Build.
I know most of you may turn your noses up at this post but please read on and I will give you the insight on what happens behind the scene's when bills aren't paid.
We have all been in the situation where we haven't paid a bill on time and a letter gets sent asking for money NOW or.......we will send you another letter in a more demanding way, don't pay that one and we will send a letter this time.....with BOLD LETTERS and if you don't pay us again we will send you a letter this time in BOLD LETTERS and a big RED BANNER!!!!!
Finally it sends a letter with all of the above and a threat of court proceedings.
All payments and activity's have a dedicated diary section in which notes are kept, this diary section starts from your account being opened and lasts until the account ceases trading.
I will put a damage rating (out of five) next to each stage and explain what it does if you go through each step of not paying.
The stages:-
So lets start with your account being opened, rule of thumb you will get 30 days credit and when the 30 days are up you need to pay your bill, you will get a little bit of a cushion period (maybe a week) before a call is made from the merchants credit control if you don't pay and they will inform you that it's due and how and when your going to pay.
Damage rating:- X
The company and credit control understand that sometimes its not possible to pay on time but it will state you paid late on your diary notes, it won't worry them but it will state you paid late on this occasion.
7-14 days, So you have forgot to pay after a weeks grace and credit control have called and you haven't stuck to the date you were going to pay, a letter will be sent and another call will be made asking for a new date, this sometimes means that your account will be put on stop although its down to the credit controller and your history so far on the account, this period runs from 7-14 days without payment.
Damage rating:- XXx
Starting to become a little more serious and the small "x" is a half rating because it depends on your history so far, if its a genuine reason that you can't pay then its excepted, if you just keep forgetting they will REMIND you by just putting your account on stop.
14 days - 1 month, It means that your account will definitely be on stop with a call made every other day from credit control asking for the circumstances and if you wanted to look at part payment (this wont get you off stop but something is better than nothing in there eyes) again diary notes start to fill your account on every call made, what was said and why payment hasn't been received, a letter will be warning of court proceedings but informing you that if you make payment it won't come to that.
Damage rating:-XXXX
This will really damage your account to a point where they may think about putting your account on a "prompt stop" meaning not even a days grace, if your account is due for payment and it goes a day over then it instantly goes on stop until you pay, it takes a while to come back from this and its a case of the company wanting to trade with you but your leash has become very tight in terms of trust.
A Month - Onwards, your account will be on stop and depending at what point your paying (The longer you leave it the worse it gets) a payment towards your account might still not be able to get it trading, letters will state that the debt has been passed to the legal team to retrieve the money and a phone call will come almost daily from the legal team to chase the money.
Damage rating:-XXXXX
At this point not only will the account be passed to the company's legal team but this will effect your credit rating, even if your account does get paid and your able to start trading again, the trust will be non existent, your credit limit will no doubt be decreased and it will have a prompt stop attached to it, the only way to gain trust again at this point is to never go on stop again for the next
6 months - 12 months and if you get close to your credit limit pay an interim to bring it back down.
To summarise this post isn't a scare tactic to get your bills paid on time (although its a pain in the backside if you don't) its to inform and help you, if you hit the later stages of what i have discussed and you have a large job come up what do think your supplier is going to say when you ask for a credit increase to get the materials? It sounds silly but the diary will look similar to this:-
01/01/13:- account opened, letter sent to customer informing of this and a 5k limit.
05/02/13:- over due £3510, called customer, is going to pay in branch tomorrow.
10/02/13:- called customer asking for payment, cheque sent to us in the post.
15/02/13:- no cheque received, account put on hold, spoke to customer and asked for him to cancel the cheque and drop a new one into the branch, informed he will do it Monday.
17/02/13:- no cheque, customer not answering mobile, left message, letter sent.
24/02/13:- no answer on mobile, letter sent.
literally every detail is logged of all the activity but this gives you an indication of what happens and Carry's on this way, if you keep your nose clean then it will give you a much better chance of a credit increase.
The other thing i want to mention to finish off is communicate with credit control, DON'T LIE! if your having money trouble then tell them, they are human and you maybe able to keep your account trading until you can get the funds together, if you lie to them and they suspect it they will put your account on stop, it isn't a machine that makes these decisions its a human and although they have to follow rules there are times that they can bend them to help you out of a difficult circumstance.
As usual you have my details for FaceBook and there's always Gmail if you wish to contact me privately but if you need help or advice concerning this or anything building related then please get in contact.
Save Build.
Subscribe to:
Posts (Atom)