How can I get people to understand that "Estimate" means, y'know, estimate?

[jpsalm123]

@william67 You should be making your estimate at a min 15% higher than what you think it’ll be after costs are associated. That way you’re final total ends up being correct or less than the estimate and makes for a happy customer. Underestimating leaves the customer to believe you’re trying to pull a fast one on them and milk the costs

 

[jeremiahlord]

@william67 Your estimates are poor then.

When you go to get your car repaired from an accident they make it very clear that there could be more damage than what is here and will have to issue an additional rider to that estimate.

Your contract needs to be CRYSTAL clear so when they sign, they need to know it CAN BE up to 30% MORE than the estimate.

There is a guy up the street from me who lists everything out in his estimate for furniture reupholstry/repair. He lists the fabric, padding, stapling etc and then if there is WOOD that needs repair there is extra.

The way he does it is like this: He takes 5% down to take it apart and give a thorough complete firm price. If you continue, then that 5% is off the total. If you don't want to proceed he puts everything back together as is. Sometimes he would refund the 5% estimate although the contract says he would keep it regardless.

 

[keyboardguy23]

@william67 TWO WORDS: Itemized invoices. Have a ledger with your previous estimate, and each additional charge underneath it, coming to the new total. no vague terms on your invoice with a charge for "oxygen breathing" (this is silly obviously but ive seen some random and wild charges.)

this leaves almost no room for normal people to be confused and reach out.

so:

Estimate: 350.00

+

New Couch Leg - 15.00

+

Delivery Fee - 45.00

+

Recovery Analysis - 75.00

+

Dump Fee - 17.00

_____________________________________

$502.00

Im in marketing and business consulting and making this simple switch will make your customers feel like they can rely on you and trust you more, and its easier for them to ask "Why is there a ___ fee?" instead of "why is my bill so high?"

 

[keyboardguy23]

also, i understand you as a business are usually not trying to rip people off. however, 99% of people have an automatic understanding that you ARE trying to rip them off. so i give business owners the advice that when it comes to paying, put your BEST act on and give them the warm, friendly customer service, even if you arent in a job where you have to.

so when people are standoffish to you and your prices, dont take it personally. they dont know. answer every question enthusiastically, with kindness, NO smarminess whatsoever, even if theyre asking the stupidest questions alive.

 

[hippyhappo]

@keyboardguy23 I full disagree with this…in my experience itemizing fully opens up more room for scrutinizing.

Get good at giving the Clients a “lump sum” fixed dollar price.

 

[bossray]

@keyboardguy23 Itemized bills only invite negotiations and complaints. People will take your itemized bill to Google and complain that a part was $100 but they found it on Amazon for $50.

We only offer flat rates now and the price is what it is. You get a quote upfront, you either accept it or you don’t.

 

[keyboardguy23]

@bossray I’m my humble experience, the opposite is true. Also, if you’re charging someone for a part, separate from labor, the part price should equal to what you paid for the part. Make your money somewhere else

 

[bossray]

@keyboardguy23 Maybe in some sectors. That’s not how it works in the trades. Parts need markup for a variety of reasons.

Although, there are a lot of struggling Mom and Pop shops struggling to survive that do business this way and have no idea why they’re always in the red.

 

[keyboardguy23]

@bossray No. I’m in business marketing and consulting and I’m telling you now it’s not cool to have hidden charges. That’s not a way to get good business or reliable customers. If you buy a part for 50, charge the customer 50. Make your money in trustworthy ways.

 

[bossray]

@keyboardguy23 They’re not hidden. We only charge flat rates. You sign a quote before we start. There’s no itemization. We factor in all our expenses for worst case scenario and typically come out with a 74% profit. All service companies are moving to flat rate. It just makes the whole process simplified and eliminates negotiating.

We’re booked out two months and can’t hire fast enough.

 

[keyboardguy23]

@bossray I work with the most successful mechanic in our metropolis and he would never charge more for parts then paid + shipping

 

[bossray]

@keyboardguy23 Then he’ll die on his tools. The rest of us will retire with empires.

 

[chrissyk]

@william67 I struggle with this too, due to the nature of doing custom work that you arent 100% sure how long itll take or if something will go wrong etc.

I would basically change your deposit structure or accept the fact that you might over or under estimate a project and just do quotes. What really is happening is the psychology of expectation or the psychology of maybe. If you are told something might happen, your brain basically assumes that it will happen, it will almost never assume it wont happen. So if you say it will probably cost $250. Then you have them pay half of that up front, you have both told them the "price" and reinforced it by having them pay a deposit. So there really is no difference in what you are doing than just telling someone the price of what this will cost. I know you do not think this but this is 100% what is happening, you say "estimate" they hear "price".

 

[william67]

@chrissyk That's a good point. I hadn't thought about how the deposit reinforces the price anchoring.

 

[yosoy220]

@william67 You're telling them to pay 50% upfront. This would lead people down the path of assuming that the remaining balance will be 50%. You've given them the expectation of a final price. Have you given them a receipt for the up front payment that says 50% on it?

I would adjust my deposit amounts to better relay that this is a deposit, not 50% of the final bill.

 

[godisgraet078]

@william67 Friend of mine had this issue - he added the Merriam Webster meaning of 'estimate' in ( ) after the word - they sign and have no room to give pushback.

 

[biblicalquality]

@william67 That sounds like a horrible way of doing things. Estimates are not legally binding. What is stopping the customer saying no I do not accept your new price after all the work is done? Or stopping you from charging 10x the estimate?

 

[suzannemoore]

@biblicalquality Mechanic's lien. He can rip out all his materials and hand the wrecked piece back to them if they want it.

Not to exceeds are the way this should be handled.

 

[overwhelmedbyabiggod]

@william67 Don't give an estimate. Give a fixed price quotation based on some caveats. Ie: Price quoted is based on the provision of X, Y & Z. If it transpires that X, Y & Z is not the case then any additional works to be charged £X per hour.

 

[grahamvanhellsing]

@overwhelmedbyabiggod This. Our store repair guy charges $125 any time he showed up and per piece to fix. He did well. 45 minutes to fix 3 things and then off to a customers home he’d go.