Mark-up (was Steinway parts)

William R. Monroe pianotech at a440piano.net
Tue Feb 19 21:36:39 MST 2008


Paul,

Thanks for the follow-up.  Responses below:

  However, when we discover a surprise - whether during a rebuild or a house call - fix it (with approval), and charge accordingly.

Apples and oranges, Bill. I should know what's in a piano, even a Chickering from 1910 :-), and the dangers and risks and possibilities. If I don't, my bad. If a string breaks, properly put in the passive voice, since good technicians never break strings :-), I discuss the situation with the client and charge accordingly. I'm responsible for the restoration of the piano in major work, and cost accordingly. I'm not responsible for the minor aches and pains of the household piano or piano owner. 

  When I am tuning and a string breaks, I charge for that.  I didn't expect a string to break, but I won't replace strings for free because I didn't anticipate it happening.  To me, it's the same in a rebuild situation.

It's not the same at all. 

Interesting.  This may be semantics.  Example: S&S Action rails, covered in crud.  I wouldn't necessarily put action rail replacements in the initial estimate.  Upon cleaning, discover rails have fractures.  Surprise.  Though not precisely "the same," I do think that both events could be classified "surprises," and I won't eat that cost.



  We do neither. We give an estimate (proposal) for a rebuild and the cost stands. Over time, we may have made extra on a job (man, I wish I could remember when that was!), and we certainly have lost some money on a job. But they balance out over time. 

  I just prefer not to depend upon the "balancing out" act.  Just charge for everything, give back an overage.

  In my business, however, I specifically have a clause in my contract that stipulates that there are occasionally unseen issues, and if I can solve it within  [X] % of the estimate, I will proceed with the repair without any additional contact with the client.  Their signature on the contract is written approval.  If it exceeds [X] %, I will obtain additional written permission before I proceed.

  That's an interesting idea. I'm glad it works for you. Personally, I've seen overage percentages on lots of different kinds of contracts, and you know what? In almost all cases, the overage was charged. Hmmm. Bad estimating? Probably not. Probably perfect estimating, including the overage. We have done what we do for over 30 years, and the losses balance the gains, but the real gains are in 1) client trust and referral, and 2) our increased savvy at estimating and costing, what we consider good business practices.


  Hard to argue with success.  I do think 1) and 2) above can be achieved with other methods.  

  Certainly, I think it behooves us all to be very thorough in assessing pianos for rebuilding, and not just writing a "form estimate" letting all the details be discovered at teardown.  But I think as long as we are conscientious and thorough during our initial assessment, the infrequent surprises that surface should be billed accordingly.

  How big a surprise will you hand your client? A new keyboard because the keys turn to be too punky to rebush? A new back action because you weren't familiar (I know you are) with Steinway short-arm underlevers? Where do you stop? 

  Good question.  I certainly agree, too, that having to call the client for approval for more $$ doesn't breed confidence, regardless how much you may warn, prepare, or otherwise educate your clients that it is a potentiality.  You've prompted me to do some looking.  In the last three years, I've only one contract that I had to exercise the overage clause.  I guess that means I'm estimating reasonably well.  And, yes, I've had a couple contracts that "came in under" and lead to a smaller final billing.  Either way, I think I'm succeeding reasonably well at 1) and 2) above.
  I think when it comes right down to it, a variety of contract philosophies can work well when the initial estimates are thorough and well-thought.  


  Simplicity says: create situations from which you will learn. Thanks for your full response, Bill. 

  So I guess you won't be adopting my strategy any time soon??  ;-]

  Paul


  My thoughts,
  William R. Monroe

  More of my thoughts,
  William R. Monroe
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