The cheaters bring down the integrity of the industry, and they hurt everyone. Obviously, I can't recommend prices because it might be construed as price fixing, but when someone purposely avoids following the law so they can charge a cheaper price, it ruins the industry and wrecks the ability for honest contractors to make an honest living. Contractors should remember:
STUCK IN THE MIDDLEMany communities require permits and inspections from the city inspector when a job is complete. The challenge isn't the cost of the permit, since it's a nominal investment. However, it does take time to acquire the permit, process the permit, and schedule a convenient inspection time for both the inspector and the homeowner. All the while, contractors are in the middle, responsible for something they can't control from either side. This is the real challenge.
Often, homeowners won't pay until the city inspector has signed off and approved the work. Meanwhile, time ticks away, and time is money when the company has already supplied and paid for the labor, equipment, and overhead. The contractor has completed the job and done what was required, but is the one in a bind waiting to be paid for services rendered.
All of this adds to the cost of doing business. Some contractors struggling financially may decide to avoid this nuisance and cash flow challenge by skipping the permit process and throwing caution to the wind, saying, "What's the chance they're going to catch me anyway?"
Many contractors haven't mastered the art of selling and differentiating themselves in the market. They compete only on price, and they look for every shortcut to lower their price. For them, neglecting the permit process is an easy corner to cut to lower the price, avoid the headache, and avoid the cash flow challenge. A professional contractor who understands the costs and builds the cost of the permit into the job is left competing on an unequal playing field.
FACING THE CHALLENGEHere are several ways to help level the field against those not playing by the rules.
Whenever they see an install truck at a home, they call the office with the address. The office checks to see if a permit was pulled on the job. If there was no permit, he feels he has a right and an obligation to the industry, to the safety of the homeowners, to the city inspectors, to his company, and to his employees, to report those companies that aren't pulling permits and are breaking the law.
As a good neighbor in the community, if you noticed someone was breaking the law at the expense of your neighbor, wouldn't you report them? He says that's the way he helps raise the standard in the industry.
Those are just a few methods to level the playing field for honest contractors and raise the standards in the industry. Knowing the true costs of doing business and building those costs into the price customers pay is how contractors make money every day.
Publication date: 08/21/2006