How to avoid being ripped off

SMH Small Business Trends

Author: Alexandra Cain

March, 28, 2014

http://www.smh.com.au/small-business/trends/blogs/the-big-idea/how-to-avoid-being-ripped-off-20140321-356r3.html

My brother’s about to do up the bathroom in the flat he’s just bought and has been getting quotes from various builders. I’m amazed at the variance in the prices – one guy quoted $18,000, another $12,000 and one guy came in at $8,000.

That’s a $10,000 difference between quotes for what’s ostensibly the same job. So how on earth should he know which one to pick?

Building is complex and there are many variables involved. Which means you need to get numerous quotes.

I spoke to Allen Cetinic, who runs Render My Home, about how to tell if you’re being charged a fair price. He says the process of quoting is a complex one. “The only way you can judge is by making sure you’re comparing apples with apples. Building is complex and there are many variables involved. Which means you need to get numerous quotes.”

Cetinic says there are many ways to approach a job, and many materials and finishes that can be used, which is one reason there’s such disparity in prices.

 “You might call in one electrician who’ll just quote you for a basic job and another one will give you a more comprehensive quote that might include things that need to be attended to over the next year. And that’s where people will go wrong – some will do a basic job and others will quote you on something that’s more thorough.”

He says it’s essential for consumers to do their research and interview people before agreeing to use a tradesperson for a job – it only takes five minutes to get a feel for whether you can work with someone. He also says three quotes might not be enough.

“You might have to speak to six or seven people before you find the right person for you,” Cetinic says.

So how should you compare quotes? One way, says Cetinic, is to be very clear on the scope of work. What does the quote include? Does it cover rubbish removal? How about cleaning up? What about painting? All these factors will influence the price of the job. It’s all about making sure your expectations are the same as the tradesperson’s. Don’t just assume you’ll get exactly what you want.

“Sharing quotes could be a good idea and make sure the quotes cover the same things,” he says.

Another important variable is the credibility of the service provider. Cetinic says: “Look at whether they have an online presence, think about where the referral to the tradesperson came from, how long they’ve been in business, their qualifications and their experience. It’s all about doing your research.”

Cetinic says there are no standard prices for jobs for residential building; there are some for commercial jobs because the scale of work on a square metre basis is usually so much greater than for work done on houses.
“Plus some contractors are opportunistic – when they’re busy they’ll charge a higher price and when they’re slow they’ll charge a lower amount just to get the work. Really, the only way to get the work done at the price you want to a standard that’s acceptable is to find a tradie you have a connection with,” says Cetinic.

Laorence Nohra, CEO at Tradebusters, which offers a tradesman co-ordination service, agrees prices depend on the inclusions and exclusions of a job.

“In general, rates vary from $60 to $90 an hour, which may or may not include a service fee. If someone was charging you $120 an hour that would look wrong to me.”

As to what sort of recourse consumers have if they feel they have been overcharged, Nohra says there’s very little if the home owner has accepted a written quote and that acceptance has been documented.

“Where you do have some recourse is when you’ve been charged extra for variables and what you’ve been charged is very different to what you were quoted on,” she says.

Cetinic says: “At the end of the day, consumers have to take responsibility. It’s not good enough to take a retrospective view. You need to have a paper trail that shows emails back and forth agreeing the scope of work and the price. No one wants to sit in tribunal hearings, so be clear on what you’re expecting and what you’ll pay for that.”

What's been your experience getting quotes from tradies? Share it in the comments below.

You’ve taken the BIG step in deciding to renovate and improve your home. Whether this is to increase your home value for selling purposes; to change, modify and personalised the look and feel of your home; to follow the latest trends and be up to speed with all your neighbours; or its to have street appeal and impress passers-by. Whatever the reason I’m sure the dreaded  feeling of dealing with all different tradesmen hangs over your head.

It doesn’t have to be that way. If you take the following steps you will hopefully have a successful experience and a house renovation bliss that will impress you and be the envy of others of the final product.

Plan, Prepare, Probe: Make sure you clearly know what you want and envisage as the final product of your home;  you have researched what would be aesthetically suitable and make an impactful look and feel; and finally you are aware of the benefit and features.

Design & Style: Whether you have a family, partner and/or living by yourself your personal style must be taken into consideration, so be aware what you want, how you want to be perceived and your home and Plan, Prepare, Probe. Check out the latest home design magazine to draw inspiration and look out for what your neighbours are doing to add that little something to their home to spruce it up.

Boring Budget  - Bang for your Buck: We cannot stress how important it is to establish your budget from the beginning. Just when you think you have considered everything something unexpected arises. Have room for movement, but be diligent and stick with your budget. Most importantly make it be known to your builder or tradesmen what your budget is, so there isn’t any hidden surprises, as many can take advantage of this.

Tradesmen Alert: There are many shonks out there, so make sure that they either have been referred to or you’ve done your research about them.

There are 4 important rules that must be met before you sign on the dotted line:

1. Call them - If they answer the phone or return your call within the hour, then they should receive tick.
2. Arrange a meeting – if they show up on time, they should receive another tick.
3. Experience - A competent tradesman or builder should know their technical stuff in detail and be able to explain it to you, another tick.
4. You as a person –must  like this person or their company, as you will be dealing with them greatly and you want the best result  - another tick.
5. Qualifications – This is a tough one, but you need to make sure that they are qualified, have all their insurances and are registered. The last you want to happen is have issues and neither party are covered – this could be disastrous and cost you more money and leave you with an unfinished job.
   
   

With the tough economical market you can’t afford to make any mistakes on any form of remedial or renovation projects as they can be expensive, so make sure you take adequate advice to steer you in the right direction. Speak to your local real estate agent or reputable suppliers / tradespeople - most common reason why property doesn’t  sell is because people don’t present their home visually and take too many short cuts.

Presentation of your home is important not only when selling but also what everyone thinks of you and street appeal.  And making sure you have professionals and experts that work with you to achieve your goal, and you will achieve your new renovated dream home.

Case Study: Render My Home - Sydney
Jan 30, 2014 by Craig Gibson 

Published: hipages.com.au

Topic: Case Studies, Trades.

Surviving in the small business jungle is a real test, no matter how good your workmanship or service may be. Besides getting your job done right (and on time) there is the not so small matter of marketing your business and standing out from the crowd. hipages.com.au caught up with Allen Cetinic of Render My Home – who are active on social media and have an active blog – about the challenges involved.

Render My Home - Top Business Tips:

1. Believe and trust in what you do
2. Project a professional image
3. Don’t discount, instead add value to your service
4. Perform all day, every day
5. Set your own standards

Tell us how you came to be in business.

We became fed up with how other cement rendering companies were providing poor customer service levels and workmanship, leading to poor public opinions of renderers. In actual fact, rendering is a highly skilled trade and a good renderer can make all the difference to the appearance of a home. This is especially evident when you see a well rendered home versus a bad one, of which there are a plenty in Sydney!

What qualification and accreditation do you hold?

I completed a Bachelor in Applied Science after high school and then used these business management skills, knowledge and work experience in construction to establish our business. I also furthered my education by completing a Diploma & Certificate IV in Building and Construction (Building).

Tell us one common misconception about rendering.

There are quite a few actually. Some people actually expect render to hold their home together. It’s almost like they think render will magically just fix everything. A render system has its limitations and is only as good as the substrate beneath it. We’ve dealt with our fair share of poor bricklaying and formwork, and no matter what we do, when expansion joints are not positioned correctly, you can bet that the render will crack.

Besides rendering what other services do you offer?

Since we position ourselves as an exterior façade home improvement specialist, we can assist in everything from roofing, balustrades, tiling and painting. We work very hard to maintain solid networks with other key trades that we believe are on the same level as us. We then recommend them to our clients and this produces a win-win outcome for all those involved, especially the client. We are really a non-stop shop for anything external.

Is there a rough cost per square metre that you work off for rendering?

Square metre rates are a dangerous guide to budget your projects on, as the rates have actually declined over the last 15-20 years. Not surprisingly - the decline in rates has translated into a significant decline in workmanship quality. However, rates for external rendering should be anywhere from $50 per m², yet there are quite a few render teams charging as low as $30m². I’d be steering clear of these guys for the sake of your home!

You have a blog and are active on social media – what is the strategy behind this?

It’s something I actually find quite therapeutic. I guess it’s my own little domain where I can vent any thoughts or opinions that are relevant to me at the time. It’s also an opportunity to inform and educate both the public and fellow tradespeople about the industry the way I see it. Sometimes I use the blog to relay a message or point I may have got from a fellow tradesman.

Your business was recently featured in the SMH – tell us how this came about.

I read an article in the SMH titled “The Trouble with Tradies”, as well as the 300+ comments that followed it. It inspired me to write a blog, which morphed into an article. I thought I’d get some feedback from the business editor at SMH and she loved it. I’ve been shell-shocked with the positive response and support the article has managed to attract.

The article focuses on professionalism – do you think this is something lacking in the industry?

Definitely. There is this so-called “cool” culture that currently exists on job sites amongst tradesmen everywhere, that is really just not cool at all. There are many cowboys in the industry that keep moving from job to job and give us a bad reputation due to their lack professionalism. We should be quite concerned about this, as it drags our industry down as a whole and makes it harder for those good tradesmen who are professional to gain the respect they deserve.

How do you ensure that you maintain your standards?

We simply just ask the customer, they are our biggest critic. Having an open and honest exchange with our clients daily means we are constantly kept on our toes. Our business relies solely on word of mouth referrals and if we were ever to drop our standards, this would mean that we would be out of business pretty quickly. We need to perform all day, every day.

What is the secret of your success?

Believe and trust in what we do and to not pay too much attention to our competitors. By having a clear vision on what we would like to provide to our customers, and being innovative in our delivery has allowed us to really set our own standards. And in a trade such as ours, this has then enabled us to shine through and become a breath of fresh air for our customers.

What three tips do you have for running a successful business?

 1. Work hard on projecting a professional image for your business – this may not necessarily translate into volumes of work at the start, but it will draw in the right type of clientele and will set your business up on the right path. If a customer makes a connection with your business’ image, chances are it will result in a win-win outcome and you may even get your next job through them.

 2. Don’t discount, instead add value to your service – when you give a discount, you are taking money directly out of your pocket and directly from your bottom-line profit. Instead, create added value options to your services and look to hold your price. Again it’s a win-win outcome.

 3. Positive cash flow – this is your lifeline to your business and you simply can’t grow without it. Be firm on your terms, but be sure to deliver your end of the bargain by delivering exceptional levels of workmanship and service. Your clients will be delighted to pay you on time with the service they’ve just received.

Tradie bashing: valid or not?
SMH Small Business Trends
January 22, 2014
Allen Cetinic

http://www.smh.com.au/small-business/trends/tradie-bashing-valid-or-not-20140122-31868.html


Many consumers prefer tradespeople who are unprofessional. So don't complain next time a tradie fails to meet your expectations.

I have little sympathy for homeowners who use second rate tradespeople, then tell the world about how bad all tradesmen are. The question I’d like to ask is what criteria are they using to make decisions about hiring the right tradesman?

I am a tradesman and can say unequivocally ‘professionalism’ is something few people are prepared to pay for when selecting a tradesperson. Qualifications, reputation, skillset, past knowledge and experiences stand for very little when it comes to comparing quotes. Ultimately, it comes down to who is the cheapest. As a result the industry continues to fail on delivering reasonable standards in workmanship and customer service.

Being ‘professional’ in the building industry is just not worth it to the tradesperson, as it does not translate into business. It’s not appreciated by homeowners until the job goes horribly wrong and they wish they’d paid more for a tradesperson with better experience.

In fact, sometimes promoting a professional image can be counter-effective. A tradesperson can have more chance of winning a job by parading him or herself as vulnerable, uneducated, sloppy and cheap, instead of being professional, thorough, conscientious, honest, caring, diligent and successful.

People don’t want to hire someone who looks successful; instead they want someone who appears down on their luck, desperate for the work and easier to take advantage of at the end of the job when it’s time to pay. In my experience, society has pigeonholed builders and tradesmen as uneducated morons who should be spoken down to, treated with contempt and made to beg for their final payment.

Indeed, lack of security of payment is a huge issue many tradespeople have to endure. These experiences create deep scars that impact their family’s wellbeing, and trigger sometimes paranoid behaviours, that make it hard to come across as ‘professional’.

There is a lot of talk about reforming building codes and standards, industry regulations, customer service and compliance coming from those at the top, but way too little action taken. There are government departments, industry associations and business groups that need to get serious about cleaning up the shonks in the industry by sticking to their words and taking severe action to clean them out.

At the moment, the cost of running a compliant business is significantly greater than running one that’s not compliant. Yet both compliant and non-compliant businesses compete for the same job in the same market. Half the contractors I know are unlicensed, uninsured or operating while insolvent, yet are knee deep in work. But many compliant ones that carry all the compulsory insurances and overheads are sitting idle, unable to land a job.

The industry needs to stop following the path of its past and start providing new, professional service levels that are on par with other service industries. Otherwise, the trades will continue to operate as a black market and never be taken seriously.

Educational institutes such as universities and colleges, which are responsible for issuing trade qualifications, need to include business management in curricula that cover basic accounting, marketing and customer service. Most apprentices coming through the system don’t know what a basic business model is, let alone the true meaning of professional services. And they are the future of the industry.

We are all responsible for changing attitudes and opinions about the building industry. But until we all start respecting tradesman for the qualified individuals they are, we can’t expect professionalism or customer service to improve.

Courtesy also needs to go both ways. It’s a small thing, but when I make contact with someone for the first time, I expect them to look me directly in the eye and show me the respect I deserve as a human being.

On the other hand, if a tradesperson isn’t punctual, fails to answer calls or return messages, can’t provide a clear and detailed quote, asks for cash, doesn’t have an email address, doesn’t have a bank account, can’t provide insurances and doesn’t present well, don’t reward him or her with the job. Continue looking until you find someone that ticks all those boxes. This degree of scrutiny is really the only way to eliminate or at least minimise risk.

Professionalism is more than just a flashy business name or logo, or even a website. It needs to be about the whole package. The industry needs to raise the bar. But it needs the community’s help to know how high to place it.

Allen Cetinic is a director of Render My Home.