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Friday, 14 November 2014

Some Thoughts on Renovation Contractor Costs

Of late, my wife had decided to renovate her office, because we are planning to launch a photography business soon. (She is the photographer, not me.) Thus, came the question of having a nice place for photography sessions. Bear in mind, we will operate it on the second floor of a walk-up shoplot. Bear in mind, we will be new to the business (although my wife has had lots of experience shooting for friends and relatives). Bear in mind, a photography studio has to look the part.

So with those thoughts in mind, we have sought a number of "trusted" and "recommended" contractors to carry out the work. Some negotiations were made, naturally, at the site where the renovation was to take place. We went to the place, looked it over, and asked how much it would cost. We didn't haggle much, but we mentally made a note of what was included in the package. The main contractor said he would rip down the partitions, remove the flooring, put in new tiling, etc. The wiring contractor said he would put wiring on the ceiling instead of trays. The painter said he would paint the walls. We looked at all of it and decided it was within budget. We went ahead.

Then the horrors came. The office, it turned out, was well renovated before, but the previous contractors had cut corners. They failed to put a beam on the wall; the previous owner had knocked down the bathroom to make a new, expanded one. They had cracks in the wall where the lack of a beam made the top weigh down on the bottom. They had cracks in places where it was covered up by 2x4 plaster pieces hung from the ceiling. And so on, and so forth. And the worst part of it was that the contractor knew all these, but kept it away from us, because he was afraid that we would be upset, or think that he was trying to con us, because we had told him that we were on a limited budget.

So one fine morning, as soon as we knew it, we went to the office, and spoke to the contractor. How much to fix this, we asked him. This much for this, said he, and that much for that. Okay... We got the picture. Contractors need to survive too. They do work, and they need to get paid. They don't work for free.

I know the situation. I'm a service provider, and a provider of professional services I am. I know how it feels when customers baulk at the sum they have to pay, simply because they think that paperwork shouldn't cost more than the price of paper. They forget, that I have to earn a living, that I have to survive, and that I will very soon go out of business if all my clients haggled on my fees and refused to pay me. I know all that, so I asked him if this was indeed, the right price for the job. He said that indeed, it was. We agreed to pay him, but not immediately. We would pay him for the extras that needed to be done, when they were going to be done.

Contractors are human too. They know, that customers want a good deal, but they too need to survive. They know, that a job well done can lead to other jobs, but a job that is not profitable soon leads to other unprofitable jobs. People, you see, tend to scout around for the lowest prices and treat that as the right price -- it isn't. Why is it that the price of petrol, groceries and other items all go up, but customers expect to pay the same fees for professional services that their uncle or auntie had paid about 10 years ago? It would be more realistic to compare prices with more recent quotations from other service providers, wouldn't it? Just as it would be unrealistic to expect a hawker to sell food at the same price he sold twenty years ago (because prices go up), how could it ever be right to expect service providers to charge the same prices that they charged twenty years ago?

Service providers, even professionals, are in the same dilemma as contractors. If there is somebody who wants to undercut everybody else, the market very soon becomes aware of it. Of course, all the customers want the cheap deal. But the cheap deal is usually available from these newcomers until they become more established. Once they are established, they usually try to move upmarket... But can they move upmarket when they have been branded as "cheap service providers"?