A while back we promised you guys a primer in contractor negotiation, so here it is. It’s really not hard to master at all, especially since getting more than a few estimates is a great way to practice your new found skills (and score an even better deal while you’re at it). So sit back and practice your game face while we run through a few of our tried and true tricks for dealing with anyone from electricians to floor refinishers and beyond.
1. There’s safety in numbers. The more experts and specialists that you talk to, the more you’ll learn about the impending job (you’ll begin to see the steps it will take, the materials it will call for, etc) so by the time you get a third or forth estimate for one specific project, you’ll speak so knowingly about what it entails that you’re sure to get a much fairer deal. We actually notice that our third and forth estimates are almost always a few hundred dollars lower because we’re so confident about the subject at that point (and we’re not afraid to mention that we’ve already gotten a few estimates)- which always helps get people down to their bottom line.
2. Cheaper isn’t always better. Of course there are people who will do something cheaply and then there are people who will do something well. Sometimes those two things overlap, which is great, but never be afraid to go for the slightly more expensive estimate if you feel uncomfortable with the level of expertise that the cheapest contractors are bringing to the table. When it came to finding an electrician to add a few recessed lights in the kitchen, we went with the least expensive licensed contractor (who actually happened to be the second cheapest estimate since one guy wasn’t licensed, which wasn’t a risk we were willing to take).
3. But the most expensive is usually not better either. We have never gone with the most expensive estimate. Ever. Not when it came to paving our driveway or relaying our back patio. Not for our kitchen renovation or our radon mitigation system. Not for our tree removal, not for our new floor installation. Never. After many (many many many) experiences interviewing potential candidates to work on our home, we’ve learned that the most expensive estimates are usually from people who are no more expert than any of the rest (and often times are less experienced so they up their fee since the job will take them longer due to lack of knowledge and expertise). For example, when it came to relaying our patio, the most expensive estimate was from a guy who wanted to duplicate our boring square patio (and kept trying to up-sell us with mentions of stone walls) while the much less expensive (and more creative) stoneworker suggested a curvy and organic shape that was a lot less money AND a lot easier on the eyes. The more estimates you get, the more ideas you can mull over for the ultimate outcome that you’re sure to love. And you’ll be surprised to notice that often the least expensive solution is also the most creative and current (sure to add a lot more value to your home than an outdated and expensive technique or idea).
4. It never hurts to ask. We rarely go with any of the numbers that people first spit out, because we consistently ask people one simple thing: “can you do any better?”. It’s kindly delivered in a friendly tone with a smile (we don’t believe in pretending to be tough, we’ve learned that you catch more flies with honey…). And the usual reaction is that the contractor will come down. Not way down, but somewhat lower than the original quote, which is really amazing when you think that all it took were five little words to score a nice 10%-ish discount to seal the deal.
5. Beg, barter and deal. Sometimes you can score an even lower estimate by mentioning something that may be just as valueable to your contractor as cold hard cash. For example when we had a tree guy come cut down about a billion big trees that hid our house from the curb, we convinced him to dole out a hefty discount by promising to give his name to all the neighbors who happened by afterwards to tell us that our front yard was looking great. We ended up handing out his business cards to score him at least five other jobs in the neighborhood, which definitely made his discounted rate to us worthwhile to him.
That about does it for our primer in negotiating a good deal. When it comes to your home, remember that finding someone who does something safely (and correctly) is definitely the most important thing. But it’s nice to know that you don’t have to pay an arm and a leg when it comes to hunting down the right man (or woman) for the job. Especially in this economy where everyone’s cutting prices and throwing in free services just to score some much-coveted work. Happy haggling!
One thing I learned through my recent experinces is also DIY’ing part of the job.
When my granite was installed a year ago I did the demo of the old counters myself, which saved some dough & time. I also got a nice SS Kincaid sink off their hands from a customer re-order for $100.
When it came to my pool re-model, re-doing the piping ourselves helped shave a cool grand or 2 off the price too!
I’ve also heard that the highest estimate is sometimes from someone not interested in doing the job, so the contractor raises the estimate. I think I read that in This Old House.
I also suggest asking each contractors for suggestions to better the design, and recommendations of ways to trim major costs. After getting about 8 estimates we ended up taking contractors advice about adding a linen closet, and doing things like the electrical ourselves (though I don’t recommend the latter fi you don’t know what you are doing).
Can I add also: always make sure your contractor is licensed, bonded, and insured. I would assume that in most state you can check the status of their license (easy in CA, on the internet), and you can ask the contractor to provide certificates for his insurance and bond in order for the project to move forward and him to get paid. Insurance is YOUR coverage in case anything goes wrong on the job or afterwards (shoddy construction, etc.), and the bond makes sure that you’re protected if he runs away with your money.
Insurance especially isn’t cheap for contractors, but the ones worth doing business with will make sure they carry it and just figure it in as one of the costs of doing business. My general thought is, if the contractor is skimping on things like licensing, insurance, or a bond, what else would he be willing to cut corners on?
Love the “can you do any better” advice – I use it often and it works almost every time for contractors, car salesmen, etc. Ask, then be quiet. Wait for their answer. Don’t keep talking (which some people do since they’re feeling uncomfortable about negotiating). A bit of patience can pay off.
If they say they’ve already given you a discounted price and you think they’re pretty close to the price you want anyway, smile sweetly and ask, “well, can you just take off another $50 (or some other smallish number) so I can feel like I negotiated?”. Works every time.
Also, if the contractor wants to put their sign in front of your house, demand a discount. I once saved $800 on a big job by agreeing to keep their sign up for four weeks.
Rene Brown says
Cool website. thanks for the advice!
driveway cost says
As a former contractor I can vouch for the “can you do any better” line.
Or try “is there anyway we can reduce the costs?”, that will make them think of different options.
After asking that try asking “i’m interested but this is a little more than i wanted to spend, can you come down a bit on the cost?” That should get them down to their lowest price.
Finally when they think they are closing the deal, ask for a little extra off: “can we round it down to this price?” or “can we just loose $50 more?”
Smile and be persistent. If you dont ask you dont get.
When it comes to any and all things “electric”, do you always err on the side of hiring an electrician? If not, how did you learn to do it on your own (your DIY projects only, or maybe a handy free Home Depot workshop)?
Or, at least, when it comes to re-installing a bathroom light fixture for the first time (which you thought would be a snap only to find that you’re not confident in the “before” pics anymore), should someone (me) hire an electrician in order to watch and learn…at least for the first time…? Wires can be scary!
As always, thanks!!!
For something like switching out a fixture we DIY those since we have learned how to do that easily and safely thanks to google and a few YouTube tutorials. First of all, turn off the power to your entire house (not just that room) and then follow the step by step instructions you find (might want to hit up the library and borrow a book on it or buy one at Home Depot). Good luck!
You are completely right-it never hurts to ask. I would say about 90% of the time a contractor will drop the price, even if it is very little. Today’s economy has people pinned against a wall, so they need the business. Of course they have to make a living too, but they knew what they were getting into when they got into their business. Just ask, you’ll be surprised.
Melissa Arlena says
Thank you, thank you, thank you!!! I just got estimates on paving our driveway and my husband asked me to call back and haggle since he is deployed right now and can’t. I was so nervous because I’m not good at that so I remembered YHL had a post about negotiating with contractors and I just used your magic words and got another $100 off!! Since we are having this done in the winter when it is slow we are saving $1000 with our extra $100 discount. Thank you for making that so easy for me :)
So glad! Wahoo!
I was with my husband when he was calling to switch his flight and it was gonna cost us about $500 extra dollars to move the flight back to later in the day. I sat quietly while he told the representative he couldn’t pay that price and kept requesting for lower priced options. After he could only get her to go as low as $284 for a flight change I told him to put your words into use. He said the exact words, (in a nice way) “can you do any better?” and she found one for $80. Makes me wonder if we had insisted further we might have gotten a change for less! Thank you for those 5 simple words that I was able to use for even a non-house improvement related negotiation!!!
Love it!!! Congrats!
Thanks for this post. I usually have grand intentions of haggling and then I end up just taking the price and walk away kicking myself! Giving us actual words to say is helpful. :)
Laura in Michigan says
I was just getting an auto insurance quote and when the quote came back, I used those 5 little words- “Can you do any better?” – and while the agent couldn’t immediately lower the quote, he did provide some options/bundles that I could investigate further. I felt really empowered and just wanted to thank you for this post! I read your post a long time ago, but it stuck with me!
So glad! Such a powerful non-pushy question!
Dorothy Mayer says
I travel in the Far East a lot and over there an asking price is only a starting point for negotiation. To them this haggling is as natural as eating and drinking.Our culture is only just getting round to this idea, there’s a lot we can learn from these people!
Just thought I’d let you know I used your five little words via my property manager on a contractor for some painting in my rental property. I was able to get two extra rooms done for the same price. Hopefully my manager will realize the value in negotiating (which I got into when I spent a lot of time overseas — they love to haggle in other countries! For some reason Americans will usually just pay what’s listed or mentioned.)
That’s amazing! So glad!