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It seems that every time I need an air conditioning or plumbing contractor they give me the run-around in quoting a price. It's always so much per hour "plus materials," but they hem and haw when I ask for an estimate on how many hours it will take and how much the materials might cost. Surely they must have some idea of what it costs to make common household repairs, don't they?

Reply: Yes, most professionals do have a pretty good idea, but only after they determine exactly what needs fixing. Trying to pinpoint a mechanical problem over the phone based upon a home owner's description is like a doctor treating a patient without an examination. You may think it's just the sniffles, but what if it's the onset of pneumonia? What if the medicine prescribed not only doesn't help you, but makes you even sicker? Likewise with home repairs.

Another part of the problem has to do with traditional pricing of labor on a per-hour basis. A company can lose its shirt if it guesses wrong about how many hours it might take to do a given job. Variations come into play based upon the system's complexity and accessibility. For instance, some repairs may require breaking through a wall or ceiling, which can add an hour or two to the job.

The cost also may vary with the skills of the service worker dispatched to the job. This is something most companies don't want to talk about, but their best technicians may be twice as fast as the inferior performers. In most cases it is simply the luck of the draw who gets dispatched to your house.

Then there are those unscrupulous operators who when work slacks off may compensate by slowing down to pad their labor hours.

Some progressive service firms are trying to resolve these problems by turning to a flat rate or "contract pricing" system. Once the problem is diagnosed, the service technician tells you the precise amount it will cost to fix the problem, no matter how long it takes him or her to do the work. It works just like you suggest - the contractors use their experience to average out the cost of doing various types of jobs. These prices are listed in a book or sometimes in hand-held computers issued to the service technicians.

Most firms using the flat rate system still will not quote a price over the phone, however. Instead, they typically charge a diagnostic fee to cover their cost of making the on-site inspection. This fee is often applicable whether or not you choose to follow through on the recommended repairs.

Some people get annoyed at this, but there is no other realistic way to do the job right. It costs the company money to dispatch a technician to the jobsite and must pay the person for time spent trying to figure out what's wrong.

For instance, if a gas water heater stops working, it might be something as simple as the pilot light being out. But it also could stem from something more complicated like a worn out gas valve. There is a big difference in the cost of service. Or the problem may not be with the water heater at all, but in the home's electrical, gas or water lines.

Also, there may be more than one possible approach to fixing a problem. At some point you might be better off replacing the broken equipment rather than repairing it. A knowledgeable mechanic can't present intelligent options until he looks at the entire system.

This is why it is risky and unfair for a service firm to quote a price over the phone. Telling a home owner something will cost "approximately" $100 to repair is a hair trigger to an argument if that person ends up with a bill for $200-300. Reputable companies can get their reputations soiled unfairly by innocent misunderstandings. This is why so many home repair firms are reluctant to quote prices over the phone.

On the other hand, what if a company covered itself by quoting the price of what they might "imagine" to be the worst-case scenario? Most people would call someone else to do the job. Or if they don't, that worst case scenario could well turn out to be a self-fulfilling prophecy.

There are some companies that do give estimates over the phone. Some mean well but just don't know any better. They are counting on luck to bring them a job that isn't any more complicated than they anticipated. Others are desperate for work, and there are always those few bad apples who will purposely quote a low price just to get in the door, then come up with all sorts of "oh but" excuses to jack it up.

Personally, I think there's a lot to be said for flat rate pricing. The advantage to the home owner is that once you agree to the repairs, you don't have to worry about the meter running on labor charges nor about "extra" material costs. You will know exactly how much it will cost whether it takes one hour or all day.

This system was developed precisely because of the frustrating situation you describe. Service contractors don't like hemming and hawing any more than their customers do. It is a constant struggle to find prices that are competitive yet which allow us to stay in business and earn a reasonable profit.




Noritz: Your tankless water heater specialist

Noritz: Your tankless water heater specialist

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