Feedback For The Week: 07/01/2002
Flat-Rate Pricing Is The Best Method
As an HVAC consultant to the industry for over 18 years, I took exception to the “Ask The Lawyer” question [“Does Flat-Rate Pricing Deceive Customers?”] from the March 25 issue. Attorney Tom Jackson implies that flat rate is used to “hide” high labor charges, somehow violates state laws, and contractors should check with the attorney general of their state. If this were true, restaurants, oil change centers, auto repair shops, thousands of other businesses and, yes, the U. S. Post Office would have to shut down. Mr. Jackson also implies that if you do not break down invoices into time and material charges you might violate consumer protection laws. I believe what the consumer protection laws actually say is you do not have to break down an invoice, but if requested, a breakdown of charges must be given whether you use flat-rate or time-and-materials pricing. If flat-rate pricing in service is illegal, what do you call pricing a proposal?I call it flat-rate pricing in replacement.
Flat-rate pricing is not illegal and certainly does not intentionally hide the costs of materials or labor to consumers. Flat-rate pricing allows the contractor to overcome the differences in technicians’ abilities, because prices for all repairs are consistent with the repairs, not consistent with the ability (or inabilities) of the technician doing the repair.
Remember, if we charge by the hour, we actually may make more money with slower, less experienced technicians. Since all technicians are not created equal and sometimes repairs take longer than normal, flat-rate pricing allows for these differences.
Flat rate allows the contractor to quote a contract price in service, just like in replacement proposals; that gives the customer the option of accepting the price or refusing it. True, a dishonest contractor might use flat-rate pricing as a means to gouge a customer, but that type of contractor would find a way to do it on time and material also. Good contractors are not deceptive but provide customers honest work for a fair price, preapproved with flat-rate pricing.
Today, flat-rate pricing is the most fair way to price for all parties concerned. Contractors get consistent pricing for all their technicians.
Customers get to approve the price before it is repaired or replaced.
Technicians don’t have to watch the clock and rush repairs because we charge by the repair, not time. It’s the best way to price today for all contractors in the residential and light commercial markets.
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Ron Collier, Ph.D., President, Collier Consulting Group, Dripping Springs, TX
Some Training Programs Need Help
This is in response to Bernie Merkle’s letter [“Up-To-Date Training,” June 3] regarding my previous letter [“Updating Courses, Expanding Horizons,” March 25] about sheet metal training. My comments were directed at pre-employment training classes — the classes that high school and community college students take in preparation to enter the HVAC trade.Bernie is absolutely right about union HVAC apprenticeship training classes — the classes apprentices attend after they are employed. The International Training Institute (iTi) for the sheet metal industry is sponsored by the Sheet Metal Workers International Association (SMWIA) and the Sheet Metal and Air Conditioning Contractors’ National Association (SMACNA). It is the finest apprenticeship training program in the world and is a model that other trades should copy. Most large cities have their own, well-equipped training facilities; their curriculum is excellent, and their instructors receive excellent teacher training.
However, I stand by my comments that the high school and community college HVAC pre-employment training programs are neglected and need industry help badly.
Leo A. Meyer, LAMA Books, Hayward, CA
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You can send your feedback to The News by e-mail at LetterstoTheNews@bnp.com or by visiting our website (www.achrnews.com) and filling out the Feedback form. All correspondence must include the writer’s full name, city, state, daytime phone number, and e-mail address. Letters may be edited for length and clarity, and may be published in any medium.Publication date: 07/01/2002