A Business Lesson From Duck Dynasty's Phil Robertson

It's hard to go a day without seeing at least one of the bearded faces from Duck Dynasty.  I haven't watched every season, but I've seen enough episodes to have a favorite; it's the one where the guys have a doughnut eating contest, Si wins, has the winning raffle ticket for the camper, and wakes up out in the woods.

My sister gave me Phil's book Happy, Happy, Happy: My Life and Legacy As the Duck Commander for my birthday this past summer and I wanted to share one specific story from it that may be eye-opening for some DIY home renovators.

Halfway through the autobiography the Duck Dynasty patriarch tells of the early days starting Duck Commander.  He received a $25,000, interest free loan from a businessman at his church.  This was his start up money and at the top of his list was a lathe to create the duck call barrels.  He shopped around and located the equipment he needed in Arkansas.  The man asked him how much he had to spend and Phil told him...twenty five thousand dollars.  At the time it seemed like a blessing because the seller advised him that the lathe he was selling was priced at $24,985.  In hind sight it may have been a tongue in cheek figure, but Phil didn't get the joke and paid the price.  Later he realized that the big tool was really worth only $5,000 and the bearded duck hunter writes that it took the family nearly a decade to recover from this con.

If you've read many of my posts you know what I'd have told him: "Get at least three prices on things when you don't know the value."  Three is good, four is better, and five is ideal.  It would have taken some time and effort for Mr. Phil to find two or three other lathes up for sale, but it would've been time well spent.  This is easy for me to say, but I will also credit this mindfulness to a large company I worked for that helped me learn this before I was out working for myself. 

Comparable scenarios happen all the time in the home renovation world.  The greener you look, the more tempted the wrong contractor will be to try to sucker you in to paying too much.  It's real simple.  They ask you something like, "How much do you have to spend?"  And you naively answer the question.  Then oftentimes they try to do you the way that guy did Phil and if you're not careful you'll be into an agreement for something very close to the number you shared or something much higher than you should pay... which to me is just as bad.  This is not the way it should work though.  You simply tell them what you want and they give you a number.  Then, you repeat the same basic scope description (apples to apples) to comparable tradespeople and wait for them to tell you what it will cost in the form of a written quote or bid.  Be straight up with them about what type of work you want them to quote and expect them to be straight forward with you in return.  Ignore any assurances that "Everyone will do the work for some similar price," or "No one will do it cheaper," and push ahead to get more prices. 

Also, I'm ready to haggle at a flea market, in a pawn shop for used tools, or when I'm buying a car, but with contractors quoting me for work, I don't go that route.  Construction renovating is a team effort and I don't do my teammates that way.  I ask them to just give me their best price from the beginning so they can "still make money."  Then I let them take it from there to get as tight as they can with their figures.  I review the bids and choose the best contractor for the job.  Sometimes it's the low number, but not always.  (For more on this topic see Push Hard to Get Quotes.)

So if you want to be happy, happy, happy, don't tell everyone at the poker table what cards you're holding and don't tell bidding contractors how much money you have to spend.  Be ready when they ask, but keep your budget details to yourself.    

Don't Beg For Quotes

Most of those who read this post will be familiar with the song by the Temptations titled Ain't Too Proud to Beg.  Well when it comes to gathering estimates for your project, I'll encourage you to think of this song and then ignore it's message.  But this advice is not about pride it's about common sense.  Don't beg for quotes.

I've written more than once that it's important to work hard to get multiple price estimates whether you're trying to sign someone up to re-roof your house, install wood floors in the living room, or agree to take down a big tree in the yard.  Three prices is good, four is better, and five different quotes is ideal.

This is an example of how you get the value of work:  if you get five apples-to-apples prices for something that'll cost three grand, there's a good possibility you'll get estimates like $2500, $2900, $3000, $3100, and maybe $3500.  Assuming you don't know how much this work should cost, you will after you look at the five different prices since $3,000 is the average.

Now, this gets me to today's point.  I'm telling you to work really hard to get multiple estimates, but don't go too far for a proposal and into the area where it feels like you're begging.  Simply put, you don't want to enter into an agreement with someone that sets you up into that circumstance.  Furthermore, if you have to ask them for their number a second time, take this as a red flag and don't forget it.  If they can handle your business, they'll be able to deliver on the task of working up a written price estimate.  It stands to reason that if you have to do anything that feels like begging them for the quote then you'll likely have to do some similar pleading when it's their turn to work or finish their part as required.     

Also, if a business person says they'll get you a price by "tomorrow morning," then they better have it for you by the next day before noon.  However, it's another warning signal when someone promises to provide your written estimate and are late.

If you find yourself working a little too hard just to get a price, that's okay.  Don't hang up the phone or slam the door.  Just acknowledge what you're doing and get the estimate you've been after.  Thank the person for their time, but use someone that quoted you in a timely, professional way.  These may be tradespeople more accustomed to using their hands and tools than office equipment or computers, but providing written estimates is part of the job too and you should accept nothing less than basic courtesy and professionalism.

See Push Hard to Get Quotes (July 9, 2012)

Push Hard to Get Quotes

A common mistake people make when serving as their own General Contractor is to hire the first and only person they meet on any given trade.  Roofing, ceramic tile, or the septic tank installation; it doesn't matter...you have to push hard to get multiple quotes and resist the urge to take a short cut and move ahead with less than three.  

Let's use plumbing as an example.  The rehabber and Joe Plumber meet and tour the property.  They talk about the project, perhaps review some drawings or sketches together, and answer each others questions.  This leads to an estimate and the novice renovator has to make a decision.  First of all, they don't have to tell the plumber yes or no at this point.  However, what happens many times is that the inexperienced renovator jumps into an agreement too quickly. 

I know how this goes in the mind of the renovator or home-builder because I've been there hundreds of times.  The plumber seemed like a good guy that knows what he's doing and what he's talking about.  Maybe he came highly recommended and that adds to the impulse to give him the green light.  Renovating a house is a lot of work with a long list of things to get done.  The person making the decision is focused on crossing things off their massive to-do list and having a plumber on board (with a name, phone number, and agreement) would feel like a big step in the right direction.  Plus, it's easy to award the first plumber the job and rationalize later that his competition would have likely been in the same ballpark (price-wise).  This is totally wrong.  You shouldn't stop at one quote and settle for that because one estimate won't give you an accurate understanding of the value of the work.  It's tempting to move ahead with the first price from contractor #1, but it's a mistake even if your uncle (a retired plumber) told you how much the job should cost, you got a guesstimate from a helpful licensed GC you know, or you diligently researched the subject on the internet.  Those are all smart steps on your path to finding a plumber and signing him on, but you need to keep going.

Let's say the first plumber (that good guy who seems to know his stuff) offers to do the job for $4,150.  You keep at it and plumber number two hands in a quote for $3,300, a third company says they'll do it for 3,000, and a fourth man submits a $2,500 estimate.  Three bids is good, four is better, and five is great.  For the sake of this example, let's just say a fifth quote comes in at $3,250.  This let's us know that the plumbing work for this job is worth a little over three grand.  It's not uncommon for the bids to stack up this way, and I'll also point out that I don't always take the lowest price.  I'll look hard at all the proposals, but ultimately I want a trades-person who can perform.  

A construction budget can get out of hand quickly and awarding work without getting plenty of prices is oftentimes a big part of this.  Going with the first quote would have meant overspending by a thousand bucks.  If you do something similar on all the major trades you'll be hemorrhaging money unnecessarily and budget headaches make any project harder than it needs to be.  I understand that there will be rehabs and scopes when five prices is just not doable; rural areas off the beaten path make magic numbers four and five a real challenge, some scopes are specialized and you'll be thankful to just get two bids (i.e. stained glass window repair), and sometimes it won't make sense to beat the bushes for prices when the cost is minimal.  I get all this, but really try to get three numbers from qualified folks and if you're able to get four or five on the big ticket things (like demolition, framing, roofing, drywall, painting, plumbing, electrical, HVAC, etc.) then do it.

Finally, there's a second very important reason why you really must get more than one quote per trade.  You have to be ready with a Plan B.  What if you choose someone and they have an accident or some personal family issue?  Things happen and you've got to have an alternate in mind so you can keep moving forward if something unfortunate occurs.  This preparedness is just smart business.  Like it or not, the sheetrocker, painter, and electrician will sure see it like this (as business), so you need to be ready to see it this way too.

Don't be foolishly impulsive and don't get caught with your pants down.  Get those quotes.