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Old 07-29-2015, 08:01 PM   #41
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I have. Nothing major but i've had a plumber come by 3 times in the last couple years. They were here about 15-20 minutes each time and charged me $30-40. They came from about 20 miles away so travel alone, round trip, was an hour or so. I paid cash so they didn't have to do an invoice or give a receipt. I'm sure that helps to get a lower price. Most plumbers would probably charge $80 or so just to show up. It's all about finding the right person. Some are willing to charge more reasonable rates.
Actually, this sounds more like you have found a circle of tradesmen who are willing to work off the books for cash at lower than the market rate. While this may work for you, it likely isn't for everybody. The story as originally described seems like eminently fair market rates. If this FA was really in the market for cut rate under the table services, he shouldn't expect legitimate businesses to provide that.
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Old 07-29-2015, 08:15 PM   #42
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You've got that right. My plumber is on staff and he doubles as my financial adviser, plus he mows the lawn.
And posts on ER.org?
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Old 07-29-2015, 08:24 PM   #43
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Originally Posted by deadshort52 View Post

Why is it that you think this is a major event for me?
Because you posted it as though it was an unusual event for you. And you said it was "driving you nuts."

Can you tell us the general business you're in? And what is your percentage of no-pays or partial-pays?
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Old 07-29-2015, 09:29 PM   #44
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Because you posted it as though it was an unusual event for you. And you said it was "driving you nuts."

Can you tell us the general business you're in? And what is your percentage of no-pays or partial-pays?

I guess what I mean by driving me nuts is that this guy has the money and he is also self employed. Usually self employed people understand the cost of doing business and just pay their bills. When I have a customer who is short on money or has some type of emergency situation its easier for me to understand.

I am an electric contractor. Our no pay, partial pays are relatively low, probably around 1%-2% annually. The ten percent that you mentioned earlier seems incredibly high to me. Our little business does right around a million dollars in gross annual sales. If had to plan on losing $100,000 a year I would definitely be wound up or I would change my business practice to better screen my customers.
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Old 07-29-2015, 09:59 PM   #45
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...
I also think that everyone should have to be self employed at some point in their life just so they understand that all of the benefits that they get from their "megacorp" have to be paid for out of the wages they are able to charge out to their customers. It would be a rude awakening for most.
...
+1 Very well said!

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You fail to realize how much they have to charge the customer in order to pay you that $17 per hour....

There are benefits... front office, buildings, insurance etc. etc... Your real cost to the company was probably 3X what you made... and BTW, they want to make a profit on you also....
+1

Having previously run my own consulting business for over 30 years I have to agree most people I have met along the way, working at their megacorp, have no idea what it costs in terms of overhead, marketing, taxes, etc. to run their own business, and think what I charged was my "take home pay". I agree with deadshort52, running their own business would indeed be a very rude awakening for many.
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Old 07-29-2015, 10:34 PM   #46
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[/B]
I would rather they strived to be more economical!
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Old 07-30-2015, 01:55 AM   #47
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I have maintained throughout this whole story that I do not intend to go after my money and that it is not worth the time or energy to do so. I simply thought that people would get a kick out of hearing a story about how a financial advisor beat me out of my wages because in most threads that I read here are blasting FA's for charging their percentage for providing their service.

Why is it that you think this is a major event for me?
I enjoyed the story and assumed it was just sharing and a bit of rant, and not an solicitation for advice on how to collect a bill, which I assume you've dealt with many times in your business.

Anyway I agree life is too short to sweat penny ante stuff like this, unless you have the time, which for most of us isn't until we are retired.

Today I decided I'm going to fight speeding ticket, if I was working I'd totally pay it. But since, I'm retired I'll enjoy the good fight more than time wasted in court.

The speeding ticket was going 30 in 25 MPH zone on a main commercial street. I'm partly embarrassed as Tesla owner for getting such a wimpy ticket.
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Old 07-30-2015, 07:18 PM   #48
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I also think that everyone should have to be self employed at some point in their life just so they understand that all of the benefits that they get from their "megacorp" have to be paid for out of the wages they are able to charge out to their customers. It would be a rude awakening for most.
Reading a book about it was enlightening enough for me. For a while I gave thought to hanging out a shingle as a photographer. The book Best Business Practices for Photographers was an eye-opener for me. It also convinced me that I did not want to run a business. (It also explains clearly why a competent wedding photographer's fee is going to be in the mid four figures.)

While targeted at photographers it would be good reading for anyone even thinking about starting a small business.

Oh, and my father was an electrician at the power company and he did small side jobs for beer money. The first dollar I ever earned was for pulling cable in a crawl space at the age of five because he couldn't fit in the narrow opening.
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Old 07-31-2015, 06:45 AM   #49
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"Having previously run my own consulting business for over 30 years I have to agree most people I have met along the way, working at their megacorp, have no idea what it costs in terms of overhead, marketing, taxes, etc. to run their own business, and think what I charged was my "take home pay".




Sometimes when I tell people we charge $75.00 per hour they gasp for air and hold their hand to their chest. Like you mentioned they think that is my take home pay. I will usually ask them what they do for work then I start to remind them of all of the benefits that they receive from their employer. Usually the conversation has to be relatively elementary because people tend to overlook things because they have never had to pay for them themselves. I typically talk about their health/dental/optical insurance, paid holidays, paid sick leave, vacation, pensions, stock options, company cars etc. Then I tell them of the expenses that they cost the company that they never see such as unemployment insurance, social security fees then we discuss over head expenses to operate a business. By the time I am done they probably start to wonder how we can make it on so little!! Nevertheless these are all things that have to be paid for so it gets calculated into our rate.

I too sometimes am flabbergasted at some of the wages/benefits that I see some posters on here claiming to get. I probably do the same gasp as stated above. But I suppose if I had been just a little smarter and not so good looking I could have stayed in school and got one of those jobs!
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Old 07-31-2015, 08:40 AM   #50
Thinks s/he gets paid by the post
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Interesting direction this conversation has taken...

Eventually you have to tell a customer what you charge by the hour, I suppose. But you really should charge by the job, if you can. Set a minimum job cost for the first two hours. This will offset some of the overhead, and establish a relative cost for the work. This may cover a lot of the service jobs you handle, and you'll never get to the question of what will the next hour cost.

When the customer has your hourly cost, they think they have the upper hand. However, they do not understand your level of experience, your investment in tools, insurance costs, and so on. If a customer needs to know that they have you at $75.00, and then compare your bill to someone who charges $25.00, that is a sign the relationship will go nowhere. Even if you do one job for $225.00 plus parts, and the repair is perfect, they will mention to everyone how high your rate was, and so on. The effect is that this customer is delivering negative advertising for several years. In a small community this could really hurt your business.
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Old 07-31-2015, 09:49 AM   #51
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You're right about such small debts not being worth the effort to be collected.

And I assume he just lost you as a source of property repairs.

I see small contractors talking in Lowes and Home Depot all the time. I just hope you'll tell all your contractor buddies what the guy has done to you.

Maybe your customer will have a harder time finding someone willing to work for him, and he'll to pay much more for his repairs.
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