Sharing Session

The sharing session that took place the first day of the meeting highlighted all the usual concerns in contracting: poor image of the industry, insurance woes, getting customers to pay, and what to do during slow times.

Bob Melko of Bishop Plumbing and Heating, Des Plaines, Ill., noted that many in the industry have contributed to the poor image people have of contractors. "Many think of us as cigar-chomping slobs with butt crack issues," he said. "We have no one to blame but ourselves."

Melko, who is active in the Chicago Plumbing Council, advised that contractors pay attention to the appearance of technicians and company trucks. By making sure everyone and everything associated with the business is clean and neat, customers will see more value, he noted. To that end, he has helped create several commercials that will run in the Chicago area, which highlight how much the industry has to offer consumers.

After showing the commercials to the group, Roger Peugeot of Roger the Plumber, Overland Park, Kan., shared his concerns over insurance issues.

"It's important that you find out if you're on their critical client list." This is the label insurance companies give businesses that they may no longer want to insure. Perhaps the business has filed a claim, or the insurance company has deemed the business too risky to insure anymore.

Several contractors shared their stories of insurance companies dropping their coverage with little advance notice - and often for no reason at all. Peugeot noted that insurance companies don't like to insure businesses that can possibly cause mold issues from water damage.

He said that after he found out his company was on the critical client list, he met with the agent to find out how to get off of it. The agent told him the areas of concern, and Peugeot took it as a challenge. He retrained everyone on his staff about safety issues (e.g., wearing goggles, lifting properly), and he and his employees meet every week to discuss safety. In addition, technicians who have two traffic tickets are no longer allowed to drive company trucks.

"We've gone two years without flooding a house, and we don't have anyone who's had tickets," stated Peugeot. He also implemented immediate drug testing for anyone who has an accident on the job. (Of course, all of this is written down as company policy, so employees know exactly what to expect should an accident occur.)

Those who are injured and able are expected to come to work for light-duty assignments. "I have them sweeping the floor, filing papers, whatever needs to be done," said Peugeot. "I don't want them at home watching the lawyers on TV."

Getting Paid

Some of the most amazing stories shared by these contractors involved customers who did everything they could to avoid paying the bill. Members told stories of customers who had them come out in the middle of the night to fix a problem (usually frozen pipes), then would either refuse to pay the bill or give an incorrect credit card number.

These members noted that they had gone over the pricing structure ahead of time and received signatures authorizing the work, yet some customers still refused to pay. Rebecca Gold, Wigginton's Plumbing Service, Nathrop, Colo., and chairperson of QSC, said the problem occurs often. "We get all the signatures up front, then find out a few days later the customer has put a stop payment on the check or else reversed the charges on a credit card. What should we do?"

Fellow member Scott Ziegler, Ray A. Shaffer Inc., Schwenksville, Pa., said he's trained employees to listen hard for clues from the customer. "Those who say reluctantly, ‘Go ahead and do the work,' are the ones who tend to renege. We won't do work in those cases now. By listening to how the customer authorizes the work, we've cut down the nonpayments from five a month to one every six months or so."

Many states have a three-day right of recision law as well, so customers can change their minds after the work is done and choose not to pay. One contractor said he has started going to court and placing liens on the homes of customers who won't pay.

How to keep going during slow times was also a topic of conversation. While all agreed that service agreements are the way to keep busy year-round, many contractors shared novel ideas about how to bring in more business. One contractor said that when they're slow, they take company trucks out and park them at grocery stores or shopping malls to act as billboards.

Another contractor said he sends flyers to neighbors of customers saying that he'll be in the area and can perform the repair work needed. One contractor has his technicians call customers and ask if they're happy with the previous repair work that was done, and is there anything else that needs to be serviced.

Offering special promotions has helped another contractor; on "senior day" Thursdays, for example, customers over age 65 get a discount, provided they've made their appointment at least several days in advance (it doesn't count for emergencies). The Internet has provided another opportunity for several contractors who said they offer discounts to those who schedule appointments via their Web sites.

The member's sharing session could have easily taken up the remaining time of the conference, but other speakers were on the schedule. Mike Maynard, QSC's business management coach, reluctantly closed the session.

Publication date: 05/17/2004