well, I work for a national. they take 20% off the top. If (or more likely when) I don't want to work for the national, then there won't be any discount.
Today, there's a discount. and yes, I know they pocket money on the front end as well. It's their game, their rules, their yard, their ball. I do run my business as a for profit business. And, so far, the last 5 years playing in their yard I've managed to make a profit. I don't always accept the price they offer. I negotiate when and where I can. I bid high for items where they don't have a set allowable. I bid high for some items where they do have a set allowable. We argue, we negotiate, sometimes they win. Most of the time I get more than the allowable. I contribute that to my being able to...articulately embellish...what is required to get the job done.
Best advice I ever got, "Don't get mad, get paid!" And the nationals will make you mad. But to get paid, you have to be creative. Example, boarding a crawl space opening. They have a set price they want to pay. But in this instance, it's not just a 36x36 opening. Down here in Alabama, they used to build houses on "piers". That is, the entire dwelling is set on stacks of bricks to keep the house up off the ground. (Many reason for doing this, no reason to explain for my purposes here.) So, the entire circumference of the dwelling is open - crawl space is(on a 60x40 house) 200 linear feet long x 1 to 2 feet high. I'm not boarding that for the $80 allowable. So, you can't submit a bid to - Board crawl space - $625.00. It comes back "Exceeds allowable, return and board for allowable".
It would read more like this. Bidding to secure approx 200 lnft of crawl space with 1/2" plywood. Opening is approx 200 lnft x 2ft. Will require approx 13 sheets of 1/2" plywood. Approx 5 man hours. will require special tools. generator, power saw, extention cords, cordless drill, pop-string, and approx 1lb of decking screws. Bid also includes, custom building a hinged door access to allow for future inspection to underside of dwelling. Bid does not include padlock (padlock bid under securing)
I haven't told them I'd do anymore than secure the crawlspace. But I did it - articulately. And for an investment in labor and materials of about $285, I'm paid $500 with a net margin of $215. (plus the padlock) you can do the math, but that's a margin percentage of about 43%. I'll take that.
On most jobs we complete where we do nothing but work for allowables, we average about 23%. At then end of the day (or month) we've been averaging approx 29% overall. It pays the bills with some left over.
You just have to realize when to say "No, I cannot complete for that amount" And let some other schmuck take the no profit jobs.
