Net profit margins

[Marko]

But will the guy who quotes £1000 not get the work? Asking £2000 is fine if you want to sit in watching Tricia all day. Surely it is a case of knowing your costs and charging a fair profit on top.

[skyhuck]

But will the guy who quotes £1000 not get the work? Asking £2000 is fine if you want to sit in watching Tricia all day. Surely it is a case of knowing your costs and charging a fair profit on top.

 

 

At the end of the day profit is profit!!!

 

It easy to make none!!!

 

We are unfortunately in a very competitive industry.

 

There is a HUGE gap between what I would like too make and what I actually make.

 

And just at the moment I think I am quoting against some people who are running the firm at a loss.

 

But if they have over heads of say £200 a day and do nothing, each day they are losing £200, if they work for £150 they are only losing £50.

 

So can I really blame them for trying to stay afloat till the good times return???

[Marko]

Ask a dairy farmer if working at a loss is a good idea. Did the good times return or did they just slowly erode what little they had before being forced out of business when their savings ran out.

 

Farmers Guardian 18/09/2009 Page 10 "UK imports 1 million litres of fresh milk a day"

 

Rule number 1 - NEVER buy work

[Mesterh]

Lots of really big companies 'buy' contracts that they know are going to make a loss so they can get the more profitable ones.

 

Tbh apart from the very few times that I havent been paid for a job I dont think I have ever made a loss yet!(famous last words though) Been borderline a few times though.

[skyhuck]

Ask a dairy farmer if working at a loss is a good idea. Did the good times return or did they just slowly erode what little they had before being forced out of business when their savings ran out.

 

Farmers Guardian 18/09/2009 Page 10 "UK imports 1 million litres of fresh milk a day"

 

Rule number 1 - NEVER buy work

 

The dairy farmer next to me kept going through all the bad times.

 

Most of the others round here gave up. He has now doubled the size of his herd, put in a modern automated milking parler and got a feed wagon. He is doing very well.

 

He has alway done dairy, beef and sheep. His argument is "when one is down, often the others are up".

 

I am lucky in having good paying work.

 

Would I work for a loss for a while to KEEP my business??? Lets hope I don't have to find out.

 

[Tom D]

I got this email the other day, clearly I'm a little expensive, however I wouldn't have wanted this job for less than £450 because I am currently quite busy, If I was desparate an had no work maybe I could have done it for 300 and broken even. But I'm not desperate at the moment and its nice to have the flexibility and to know that I'm not running at rock bottom already.

 

"Thank you for your quotation dated 3.9.09 for £590.00 + VAT, however we have now selected another contractor for the works.

 

Alternative prices were received for £395.00 + VAT and £425.00 + VAT.

 

Yours faithfully,"

 

Lets face it, if you're charging rock bottom prices now just to stay afloat what are you going to do come January - February when times are really quiet. I'd rather charge more now and have some money in the bank come the winter.

[skyhuck]

 

Lets face it, if you're charging rock bottom prices now just to stay afloat what are you going to do come January - February when times are really quiet. I'd rather charge more now and have some money in the bank come the winter.

 

Absolutely!!!

 

BUT, what would you do if you got an email like that after ever job you quoted??

 

And were winning NO work???

 

I don't think that will ever happen, but we are talking "what if's" here.

[Tom D]

You're right mate, I'd just start cutting prices, my point is: at least I can cut them, some seem to be already operating at rock bottom.

 

I think its become almost subconcious, I look at a job and if I'm feeling good about it and have already got other jobs that week then I'll charge my normal rate with a good margin, if I have lost a few jobs recently I'll probably charge less. I reckon I do this without thinking it just sort of happens.

[skyhuck]

You're right mate, I'd just start cutting prices, my point is: at least I can cut them, some seem to be already operating at rock bottom.

 

I think its become almost subconcious, I look at a job and if I'm feeling good about it and have already got other jobs that week then I'll charge my normal rate with a good margin, if I have lost a few jobs recently I'll probably charge less. I reckon I do this without thinking it just sort of happens.

 

I am EXACTLY the same mate!!!

 

But are these other firms already at the stage where if they don't win THIS JOB they have NO work??????????

 

After reading many of the posts on here, regarding lads being laid off, etc, I think some are

[Stephen Blair]

the bubble had to burst some time, but it happened so quickly, pretty much overnight