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Competitively Selecting Contractors


Andrew

This is re posted.


Andrew Keller

Every morning Larry and I dig into a form or idea that has caught our eye. Our hope is that our chat inspires you to never stop thinking and possibly challenges you in a new way. If you'd like to help support the show, please visit patreon.com slash reposted. Thank you for stopping by.


Larry

Okay, Mr. Keller, we've recently both moved into new homes you're more familiar with the species known as contractors that I am. I've recently been dealing with a plumber. Hence our quote today comes from Norman Augustine, the process of competitively selecting contractors to perform work is based on a system of rewards and penalties, all distributed randomly. I moved into a house and three weeks after I moved in, the water heater started making a loud banging noise. But the first time in my life, I'm 47 years old, I had to call a plumber and have him come fix something because I've rented all my life and someone else took care of it. Not only did I have to call the plumber, I had to pay for the plumber. So first of all, how do you choose a plumber? How do you pick the right one, all that good stuff goes into it. Nevertheless, we end up calling the guy that was literally his name was on the water heater. And he was robbing us. He was charged like three times more than what it should have cost according to you and some other friends that I had another plumbers that I call how I mean, our contract, it seems as if contractors are like everybody else in that they want to do a good job. They didn't go into the business of roofing or plumbing or painting to rip people off. So why do we all feel like they're ripping us off?


Andrew Keller

This is the most cathartic episode we've ever had. That's off your chest. I love that. Yeah, I don't think people go into contracting to rip people off, I think you start to see opportunity. And especially if you kind of run your own thing, and you don't have an office scheduling you, you're going to follow the path of least resistance. And if you're busy, you start throwing your numbers higher and higher. I really liked this quote from Norman who I know did you look up who he is? Yeah, he's a big time. Bass guy. Yeah, exactly. Which is apt because my brother is in the next room of this house having a discussion about spaceflight.


Larry

Yeah, by the way, he's a really big deal this guy, but my favorite thing is he's a Boy Scout.


Andrew Keller

So he's resourceful. Which is important. Always be ready. I don't know anything else we billows Yeah, whatever. Yeah. The quote is, yeah, it competitively bidding is based on rewards and penalties. I don't know about distributed randomly, I guess we could break down how that is true. But in this, the more educated you are, the more likely you are to not get fleeced. Like if you told me right now, go to a PR firm or go to a design firm and get a logo made, I would have no idea how much that cost. But if you said get a quote, to have plumbing work done, I'm more educated. And so the work performed on rewards and penalties, you're rewarded for being more educated, and the whoever's performing the work becomes rewarded for being better at their job. So the more efficiently they could do it, the more than go on So yeah, I mean,


Larry

Well, okay, having said that, do plumbers just specifically plumbers realize that most people are like white collar workers who have no idea what is going to happen and have no idea what it costs, what the labor cost, what the parts cost? So that therefore they can do whatever they want with this white collar homeowner.


Andrew Keller

Yeah, I mean, I think a lot of people realize that probably the further you get on your career, there's, especially in a city like San Francisco, where you just assume everyone has huge checkbooks. I have all sorts of stories on getting different ranges of quotes with the most extreme ranges. I when I lived in San Francisco, the building I lived in, had to be had to have the siding redone and it was on a hill and you need the scaffolding. It was pretty elaborate. But it was four storeys I got my first quote, and the guy sent me he emailed it to me it was one line, it said $90,000 What does that mean? He's I was how much it cost. I was like, Where's that money going to? And I was like, all right, well, I have to manage this myself. At the end of the day, we did it for $18,000. So it's like, I guess a lot of times contractors will throw huge numbers out there. And if you're willing to pay it, I'm willing to do it. So


Larry

and that's especially true in San Francisco. I went to buy a bed I went to one of those fancy places like Mattress Firm or whatever, they were going to charge me $2,000 we figured out the bed we wanted. Then we went to Costco, and we got the bed for $800 the exact same bed for $800. They were charged and that's the way it is and everything it's after right because most people will just pay it. So this guy gives me this outrageous quote, quote this plumber, and I call him back I'm like, Hey, man. went around, I got pricing your triple charging me for what it's worth, I want to give you the benefit of that out. I know our San Francisco works, people just throw out a price. I want to be fair and come back to you and just see if we can work something out, will you give me a fair deal? And he started to lecture me about his business and how we build people, and just completely gives me the business and I'm like, dude, okay, I'm like, man, I go to a school, my wife teaches I go to a church, I belong to the Elks Lodge. I'm just gonna tell you like your words, gonna get out that you just tried to rip me off, and I tried to give you a fair deal. And he was having none of it.


Andrew Keller

I think you going to church doesn't mean anything. There's plenty of millionaires that go to church. He talked on this show about someone that got up in your community group, it said, hey, yeah, this is too big. They presumably go to church, I want to point out my favorite part of this entire episode is you said one of those fancy places the mattress for her or whatever?


Larry

Well, I don't know who his matches for was like, that's the only one I get thing. I don't even know what the name of it was


Andrew Keller

not fancy at all, you kind of touched on a point that a lot of people don't know, if you don't deal with contractors is don't ask, like, if they'll get going, talking about what they do. And they just want to be heard. And everyone in the trades, if you'll, if you give them a window to chat, they will talk your ear off. And it's the worst thing ever. I've just had to walk away from people talking to me before. But also, I mean, I didn't work with this guy. But I would say nine times out of 10. If you are given a price and ask for a lower, you will get a lower price.


Larry

So here's the deal. I got to believe in I called a bunch of plumbers this week. Most of them are small business owners who do because they like it. And they you know, I assume that they have some like they want to help a consumer get into this in their small business owners. And they got to make a fair price, especially Jeff, just go work really hard to occupy everything.


Andrew Keller

Yeah, I mean, I think people probably got into it for positive reasons. But how do people react under pressure under stress? And right now, I'm guessing that there's a high demand for construction and work. And so it's like, well, I want to help people. But I also have 13 people calling me right now. 13 reasons why produced by Selena Gomez is? Yeah, but in the Bay Area.


Larry

That's kind of my other backup questions. Like why are contractors always late? And on their time is that just because they are juggling so many balls? Or contractors are all laid people? Or the Why are they always operating on whatever vacuum, they think that they should operate on?


Andrew Keller

The same reason that dentists you have to wait for that because you agree to do work and you don't know exactly how long it's going to take to do say, hey, I want you to demo this wall. Okay, that should take me 45 minutes, but all of a sudden, there's electrical in there, there's plumbing in there. It's like, Okay, I have to turn off the power, I have to turn off the water that just takes longer. So it's like it's a sliding scale. I mean, also, a lot of them aren't good at time management, but you just have unforeseen conditions and it's not like, hey, I want you to fill this cup of water like it's nothing straightforward and construction.


Larry

Well, I mean, I really want to help and be connected to the contracts by the way. So this contractor that this plumber that like was going off of me saying that I had no reason to question his pricing. I just want to wrap this up with a bow. I sent him a Starbucks gift card I found the address for the business it was like Amen. I completely disagree with your pricing. But I guess you're the boss over there and you get to decide. Let's agree to disagree. Watch by Carl your assistant cup of coffee.


Andrew Keller

Okay, that's that seems passive aggressive.


Larry

It was a little bit but like, you know what, I'm going a different route as opposed to like telling everybody No, this plumber sucks.


Andrew Keller

Well, another I don't want to go over talk to him again. But you could say I could hire a union plumber at full rate for four hours for cheaper than the $600 you're quoting me. Please go down the union hall and say hey, I want you to do it. Anyway. I got it guys. No good.


Larry

contractors, man. What are they good for? I'll take center houses.


Andrew Keller

Absolutely nothing. Well, if you if you think going to church means you don't have any money. please reach out. You can find us at repost it podcast on Facebook, Twitter, or Instagram. I'm Andrew Keller for the weary homeowner, Sam. Thanks for stopping by.



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