GEARHEAD
YOU CAN QUOTE ME ON THIS
A few months ago I wrote a
column titled “A Case for Quoting”
for a marine industry trade magazine
for which I’m an editor. In the
column, I threw down the gauntlet
for boatyards, marine industry
contractors, and, to some extent,
boatbuilders (whom I’ll collectively
refer to as “service providers”),
making it clear that they need
to get savvy when it comes
to quoting.
You see, in my work as a
consultant for boat buyers and
owners, the most common
complaints have to do with cost—
not necessarily the high cost of a
product, project, or repair, but the
angst, frustration, and anger that
result from not knowing what the
final cost will be. Indeed, I’ve had
more than a few clients tell me,
“I ask the service provider for an
estimate, then I triple it and I have
a number that I know is realistic.”
To my peers and colleagues in the
industry, I submit that this is no way
to win customer loyalty, admiration,
or respect. Instead, it’s a fast track to
enmity, bitterness, and disputes. In the
aforementioned column (which you
can read at http://www.stevedmarine
consulting.com/boat_brokers_dealers.
php#caseforquoting), I shared
another thought with those in
the industry: expect more of
your customers to ask for quotes.
I insist upon it, and so does today’s
economy, although the latter reason
really shouldn’t matter. I would not
accept a reversion to business as
usual—i.e., customers needing to
triple the estimates they receive—
when our current economic woes
fade from memory. Providing quotes
must become the norm in this
industry if it is to endure, and,
like so many other changes, I
believe this one will be driven
by you, the consumer.
Steve D’Antonio
Full-vessel electrical refits and panel replacements, while complex, are projects worthy
of the quote process. For skilled, experienced, and preferably ABYC-certified electricians
who carry out such work on a regular basis, preparing a quote not only is reasonable
but also can yield benefits in the layout and material-acquisition phases of the project.
Time And Material
Versus Fixed-Price Quotes
I routinely hear the terms “time
and material” and “fixed-price quote”
used in the marine industry. When I
do, I often suggest to my clients that
they request clear definitions of these
terms from each and every contractor.
My definitions, while typical, are
by no means codified within the
industry, which is why you must
ask for clarification—in writing.
Time and material (T&M) means
you will be charged a specified labor
rate, which must be detailed in
writing, for every hour spent aboard
your vessel carrying out the agreed
upon tasks. You also will be charged
for the cost of all materials plus a
reasonable markup; that is, for every
pump, foot of wire, screw, pair of
disposable gloves, quart of primer,
sheet of sandpaper, etc. When the
T&M approach is taken—and that
shouldn’t be very often—I would
argue strenuously that the material
markup should be based on the
service provider’s cost plus a
percentage, rather than an arbitrary
list price for the product that often is
based on a (fanciful) manufacturer’s
suggested retail price that no one
should actually pay. By the same
token, you should expect a markup;
it’s part of a service provider’s profit
formula, and without profit, there’s
no incentive. With the cost-plus-a-
percentage approach, if the provider
gets a deal on a product because
it’s on sale or because it has been
purchased in bulk, the savings are
passed on to you.
