I recently completed a small project for a local real estate broker. One of her agents contacted me today to inquire about an Elevation Certificate. I quoted her a price and she said she would get back to me.
I just heard back from her and she said the seller had contacted the insurance company and the insurance agent told her that an Elevation Certificate shouldn't cost more than $200!
What? Did I miss something? Did insurance companies start setting my rates and I just missed the memo?
Request that she have the insurance agent issue her the EC then.
I would tell her that was a great price and to have the insurance company go ahead prepare the cert!
Now is the time for all good men to come to the aid of their country. Typing class 9th grade!
tell her that flood insurance should only cost a dollar
I get that alot David. The real sad thing is....in our area (especially during Lean Times)....if they call the right place..they can probably get it done for not much more than that. I started going with a flat rate on EC's in the hopes of "winning some" and "Losing some" (mostly winning though). I couldn't pull the truck out the driveway for $200...much less have an accurate EC completed (with confidence.
the insurance company missed a decimal point in that memo
Why should the agent be any different then the realtor, banker, city, title co, and anyone else that does that to us?
I fetch $750 and up fer em B-)
The last one I did came in at $975.
I'm with My felllow
New Englander...Last one I did was for $975 for a 30'X30' ranch.
I charge by size and type of house.
"That is correct, the first hour is $200. Every hour to follow costs $160."
With all due respect gentlemen, conversations like this are part of the problem.
Would you price that product exactly the same for Bill Gates and for your favorite cousin? I hope not.
Pricing the product and pricing your time come with the same pitfalls.
Time to consider pricing the customer instead of pricing the product.
Larry P
> With all due respect gentlemen, conversations like this are part of the problem.
>
> Would you price that product exactly the same for Bill Gates and for your favorite cousin? I hope not.
>
> Pricing the product and pricing your time come with the same pitfalls.
>
> Time to consider pricing the customer instead of pricing the product.
>
> Larry P
Larry, that's bunk, and you didn't proof the post. What you meant to say was, it's time to consider the project, and price accordingly on the project and not the task.
I think you'll agree that if Bill Gates had a 1500 sq ft house and needed an EC, he shouldn't be charged more than you normally would for that type of project, unless it warranted it, just because he's worth billions.
🙂
That's right. Have "the realtor, banker, city, title co, and anyone else" that declares how much a survey should cost to go ahead and perform the survey.
> Larry, that's bunk, and you didn't proof the post. What you meant to say was, it's time to consider the project, and price accordingly on the project and not the task.
>
> I think you'll agree that if Bill Gates had a 1500 sq ft house and needed an EC, he shouldn't be charged more than you normally would for that type of project, unless it warranted it, just because he's worth billions.
>
> 🙂
Kris,
You know me too well. Far more frequently than I care to admit, my proofing skills are lacking. However, in this case, I did say what I wanted. What the gentlemen above are doing is discussing the price of a product. (I know we could argue that an EC is a service but to the client that sort of discussion is meaningless.)
And yes, I would charge Bill Gates more money for exactly the same product than I would charge a favorite cousin. It is this notion that every client pays exactly the same amount for the same product and under all conditions that is causing us so many problems.
We pay different prices for the same product all the time. You go into a fancy restaurant and order a beer, you will pay a higher price than at the grocery store.
As I have been saying in the POB articles for months now, price based on the value of your work. That value will vary from one client to another. Talking about what to charge for any survey product has things in the wrong order. That is charging for the product, not for the value. None of us can know the proper price for the product when the value is related not to the product but to the client.
Larry P
I don’t necessarily disagree with your premise but your analogy needs some work. You switched from being the provider of a product or service (a survey) to two different clients to being the consumer of a product or service (beer) from two different providers.
Based on your contention that it’s okay to charge Bill Gates more than you charge your favorite cousin for exactly the same survey, the proper form for your analogy would be, "If I go into a fancy restaurant wearing a flannel shirt and jeans, should I expect to pay less for a beer than the gentleman sitting next to me wearing a tuxedo?"
I’ll leave it to you to answer that question.
> I don’t necessarily disagree with your premise but your analogy needs some work. You switched from being the provider of a product or service (a survey) to two different clients to being the consumer of a product or service (beer) from two different providers.
>
> Based on your contention that it’s okay to charge Bill Gates more than you charge your favorite cousin for exactly the same survey, the proper form for your analogy would be, "If I go into a fancy restaurant wearing a flannel shirt and jeans, should I expect to pay less for a beer than the gentleman sitting next to me wearing a tuxedo?"
>
> I’ll leave it to you to answer that question.
Rich,
You are quite correct. Thanks for helping me see things from a different point of view. My earlier analogy is hopelessly flawed so let me switch to a completely different analogy.
Last time you flew somewhere on a commercial flight do you suppose each passenger paid exactly the same amount for their ticket? Of course not. Each passenger got to their destination at approximately the same time. So why the different ticket prices?
Some paid more to have larger seats and more personal service (they call it first class for a reason).
Some paid more because they had to fly on short notice.
Some paid more because they had lots of baggage.
Some paid less because they were willing to purchase well in advance and buy a none refundable ticket.
Some paid even less because they were willing to show up at the airport and get a seat if one was available but not get a seat of all were sold.
My point is, the airlines do not price each seat on the airplane at exactly the same price. They price the customer, not the service.
Do I advocate we treat our customers like the airlines treat theirs? Of course not. But there is much we can learn from paying attention to how they operate.
One of the fundamental principles I advocate is pricing the customer and not the product. It is that concept that is missing every time we have a "price this product/service" discussion. We shouldn't be pricing the product/service. We should be pricing the customer.
Larry P
Not sure if i follow you 100% Larry, but I think I see your point. I don't agree with everything you say, it's always worth giving it a listen.
I charge for certs based on what I think the project is worth...smaller, easier to work with house= lower cost.
A flood certificate as I described above is cheaper for a 30'X30' Home than say it would be for Bill Gate's residence. The product (the Certificate is the same) but my cost and value is far different.
Larry, all of the quotes I have ever done in the last 45 years have been built upon how long I think it will take to do the job, the overhead costs and a reasonable profit margin.
I cannot remember ever considering the net worth of my client. To me to do so and act upon that would be unethical and rather greedy. I just can't do that. I simply cannot throw fairness and equal treatment of others out the window so easily. Just not the way I was raised.
unfortunately Larry an EC is a commodity to many clients and these clients are the ones that expect $200 EC's, now we can ignore them or we can try and find a way to get them to realize the value we provide. In this case, an insurance company needs a good talking to. They have no business telling a client how much an EC costs. I would ask the client who the insurance agent was and speak to them personally. I would tell this agent that they have no business quoting prices.I also think there is a minimum value for a service and when I am faced with these type of clients, I give this minimum price on a normal building site. My other concern is how do we get surveyors to realize the value of their own services???