Discuss Cut-throat Competition: The Race To The Bottom in the Business Related area at ElectriciansForums.net

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JK-Electrical

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Electrical installation work, as all self-employed electricians will know, is a highly-competitive business. My own business operates mainly in the greater Glasgow area, and I have to say that I'm finding it increasingly difficult to compete on a level playing field.

I was recently approached by a builder who enquired as to what my fee would be to carry-out an EICR and some PA testing in domestic properties. I told him that I charge ÂŁ100 for a one-bedroom house, ÂŁ125 for a two-bedroom property, and ÂŁ150 for a three-bedroom. Inspection and testing of outbuildings incur an additional fee. Imagine my surprise when he told me that my prices were "way too much". Imagine my further surprise when he told me that "the young electrician" that the builder currently uses to carry-out EICRs charges a flat-fee of ÂŁ40. Aye, you read that correctly, ÂŁ40 for an EICR regardless of the size of the property. My response was that I couldn't possibly compete with such a ridiculously low price unless I was willing to work for around ÂŁ8-ÂŁ10 an hour, or was willing to cut corners to save time, neither of which I would even begin to contemplate.

I occasionally use MyBuilder as a source of generating business, particularly during times when business is slack. I recently received a lead through the site inviting me to quote for a consumer unit upgrade. Upon contacting the customer to further discuss, the very first question that I was asked was the inevitable "how much is this going to cost me?" I told the customer that although I could provide an estimate, I could not, however, provide a fixed-price quotation prior to me having visited the customer's home and completed a survey. The customer responded by telling me that "all the other electricians I've shortlisted have given me a quotation so why can't you?"

I then explained to the customer that I was somewhat surprised to hear that electricians would even think about providing a fixed-price quotation for a consumer unit upgrade without having first attended the property and carried-out the requisite inspection and testing that needs to be done prior to a consumer unit replacement. The customer was having none of it. They wanted a price there and then. I once again reiterated that I could provide only an estimate at this stage, and told them that the work would cost anywhere between ÂŁ250-ÂŁ400 depending on a variety of factors. Imagine my astonishment when the customer told me that they had been given a fixed-price quotation of ÂŁ200 over the phone by a "nice young man", and that they would now be offering the job to the comedian .... sorry .... electrician who quoted that unrealistically low price.

These two examples are but the tip of the iceberg. There are plenty more that I could cite. What particularly disturbs me is that it isn't "Dave down the pub" who is undercutting me, but young electricians who have not long completed their training. I just can't compete with the insane prices that these young electricians are quoting, particularly when some of them are evidently not even bothering to carry-out any essential inspection and testing before issuing quotations.

My gut instinct tells me that such scoundrels are most likely still living at home and being propped-up by 'the bank of mum and dad'. Perhaps the fools erroneously believe that the way to get ahead in business is to ruthlessly undercut everyone else. The strategy of a newly-started business using 'loss-leaders' as a means of winning customers is one thing, but I don't see how such a business model can possibly be sustained indefinitely. The end consequence of people quoting absurd prices is that a race to the bottom is instigated. It's a race that I have absolutely no intention whatsoever of ever participating in.

I'd be very interested to hear the views of other forum members regarding this issue as I'm sure plenty other electricians will have had similar experiences of cut-throat competition negatively impacting on their own businesses.
 
think you put the situation in a nutshell there. that's the domestic market been well fooked and niceic and the other scams along with Electrical Trainee courses are mostly to blame, along with the part pee nonsense that we have here. don't think it applies in scotland.
 
As Tel says the NICEIC who once enforced high values are now sending our trade deep down the drain and I doubt it will change in the near future unless one of these fast track monkeys kills some innocent person.
 
Unfortunately that's how everything is going.
In hull I keep coming across the same guy who's been undercutting me.
I use to get plenty of work from restaurant and take always, but now they are getting a guy with qualifications from his home country.
I've been back to sort some of mamoods work out, but decided no more after I went to a long term customer who had used mamood to install his new led price wall. It all looked rather nice until I was asked to look at why his shop alarm keeps going off. I did some tracing and then popped some of the shop tiles. Found a wire to his new led pricing display had totally burnt out and cooked all cables it was laid on, including the alarm cable.
I took pictures and then told him it's ÂŁ300 to correct it. He said mamood is much cheaper than me. To which I replied, but I do it right, plus I now have photographic evidence of bell wire used to connect the led driver to the mains socket.
Not seen mamood in months now....I wonder why.
And yes it was bell wire with Be1363 plug on one end, the other was connected to a LED driver.
 
Domestic work is saturated with cheap labour doing the work with one spark over seeing it and another one signing off the work with a cert so to speak.

It will only get worse for the genuine decent Domestic Electricians trying to work for themselves given the amount of career changers and every other tom dick and harry wanting to be Electricians and 99% of the time the only route is Domestic work. Then they want to work for themselves and start a business and so on.

Good all round Electricians can earn between ÂŁ700 to ÂŁ1000 a week on site now and that ain't bad money but you need a Gold Card to get on the majority of sites.
 
Electrical installation work, as all self-employed electricians will know, is a highly-competitive business. My own business operates mainly in the greater Glasgow area, and I have to say that I'm finding it increasingly difficult to compete on a level playing field.

I was recently approached by a builder who enquired as to what my fee would be to carry-out an EICR and some PA testing in domestic properties. I told him that I charge ÂŁ100 for a one-bedroom house, ÂŁ125 for a two-bedroom property, and ÂŁ150 for a three-bedroom. Inspection and testing of outbuildings incur an additional fee. Imagine my surprise when he told me that my prices were "way too much". Imagine my further surprise when he told me that "the young electrician" that the builder currently uses to carry-out EICRs charges a flat-fee of ÂŁ40. Aye, you read that correctly, ÂŁ40 for an EICR regardless of the size of the property. My response was that I couldn't possibly compete with such a ridiculously low price unless I was willing to work for around ÂŁ8-ÂŁ10 an hour, or was willing to cut corners to save time, neither of which I would even begin to contemplate.

I occasionally use MyBuilder as a source of generating business, particularly during times when business is slack. I recently received a lead through the site inviting me to quote for a consumer unit upgrade. Upon contacting the customer to further discuss, the very first question that I was asked was the inevitable "how much is this going to cost me?" I told the customer that although I could provide an estimate, I could not, however, provide a fixed-price quotation prior to me having visited the customer's home and completed a survey. The customer responded by telling me that "all the other electricians I've shortlisted have given me a quotation so why can't you?"

I then explained to the customer that I was somewhat surprised to hear that electricians would even think about providing a fixed-price quotation for a consumer unit upgrade without having first attended the property and carried-out the requisite inspection and testing that needs to be done prior to a consumer unit replacement. The customer was having none of it. They wanted a price there and then. I once again reiterated that I could provide only an estimate at this stage, and told them that the work would cost anywhere between ÂŁ250-ÂŁ400 depending on a variety of factors. Imagine my astonishment when the customer told me that they had been given a fixed-price quotation of ÂŁ200 over the phone by a "nice young man", and that they would now be offering the job to the comedian .... sorry .... electrician who quoted that unrealistically low price.

These two examples are but the tip of the iceberg. There are plenty more that I could cite. What particularly disturbs me is that it isn't "Dave down the pub" who is undercutting me, but young electricians who have not long completed their training. I just can't compete with the insane prices that these young electricians are quoting, particularly when some of them are evidently not even bothering to carry-out any essential inspection and testing before issuing quotations.

My gut instinct tells me that such scoundrels are most likely still living at home and being propped-up by 'the bank of mum and dad'. Perhaps the fools erroneously believe that the way to get ahead in business is to ruthlessly undercut everyone else. The strategy of a newly-started business using 'loss-leaders' as a means of winning customers is one thing, but I don't see how such a business model can possibly be sustained indefinitely. The end consequence of people quoting absurd prices is that a race to the bottom is instigated. It's a race that I have absolutely no intention whatsoever of ever participating in.

I'd be very interested to hear the views of other forum members regarding this issue as I'm sure plenty other electricians will have had similar experiences of cut-throat competition negatively impacting on their own businesses.
You will probably find that these young electricians, and I use the word loosely, have done a couple of short courses, gained the 17th update and the worthless part P spent who knows how may 100s of pounds, joined some scam or whatever and call themselves "Qualified Electricians" laughable when you Analise it, a couple of 1 day courses, instant Sparks, or as one notable member calls them "boil in the bag Sparkies" I certainly glad I'm out of the mix now.:mad::p:Do_O:mad:
 
Don't think the blame can be laid at the scams or 5 weeks sparks, they have other issues.

It's the damn internet, trust a trader etc, and B&Q's etc selling cheap electrical products. I did a quote for a bathroom refurb' where the customer said my quote was a bit steep. Never the less I was asked to do the job (not sent my invoice yet:rolleyes:). Criticised all the other trades, as well. Why would I spend all day in someone's itchy loft for less than ÂŁ180?

Trouble is, we've seen endless OP's and threads asking how to wire up their new two way switches etc, they've bought, and members falling over themselves to help, why would you employ someone to come to your house to sought it, when you can get it for free on the internet.

Last time my van was serviced, the mechanic's hourly rate was ÂŁ85.
 
I quoted recently for a bathroom refit, with the customer supplying the lights..... When I discovered bath store had charged ÂŁ50 per GU10 IP light with led I added the option on my estimate to supply...
Bath store got their boxes back and I supplied the lights, far cheaper, but still made my desired markup
 
Totally agree with you Midwest.
But I do enjoy those calls I get...they start off with, I was given your number. I'm changing my lounge light, I've joined all the blacks together and all the reds together and the fuse keeps blowing.
My reply is always ..yer it will, you need an electrician, are you an electrician...
The answer is always no.
I always reply, then why are you doing it. Would you fly your 747 to your holiday destination to save a few quid, NO, because you can't fly a plane, so why try something as dangerous as changing a light fitting when you don't know what you are doing.
I then say, it will be ÂŁ60 for me to pop n sort it.
 
Middy I see where you are coming from, and in some respects agree with you, but look at the number of, as you called them 5 week Sparks who have joined a scam, and the scam are willing to take their money, and yet some of these guys have, as I mentioned earlier a couple of worthless courses and are "qualified" you are always going to get the DIY Chancers, trying to save a few Bucks, imo the scams have a lot to answer for in recognising poorly trained Electricians, or DIs as they are called these days.:mad::eek::rolleyes:
 
You will probably find that these young electricians, and I use the word loosely, have done a couple of short courses, gained the 17th update and the worthless part P spent who knows how may 100s of pounds, joined some scam or whatever and call themselves "Qualified Electricians" laughable when you Analise it, a couple of 1 day courses, instant Sparks, or as one notable member calls them "boil in the bag Sparkies" I certainly glad I'm out of the mix now.:mad::p:Do_O:mad:
Makes you wonder how they get through the assessment for these screams ? .
 

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