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The half fee thing by GBDAR is, in my opinion, a scam. I abhor taking a reduced rate for a BER and I recently got another one unexpectedly as well that does something similar, just nowhere near as bad.
It doesn’t cost any less to make the call, we don’t pay the engineer any less for his time, the fuel cost is the same and they expect to pay us less for the call. 😕
Added to which you have the additional labour to write out a report or make calls for prices and report it back as well as (as Bonzaco pointed out) any spares that were ordered as no bugger wants to know about taking them back!
Please don’t deluge this thread wih replies about GBDAR, there’s the Rumour Mill for that or start a new thread here and we can discuss them if you like. It’s a subject that’s cropped up many a time on the mailing list and I *know* a lot of you are very p**sed off with them.
K.
There is a contract running currently that not only expect you to accept a reduced fee, but to install a new product if the appliance is BER, all for the same reduced fee.
It is a contract we no longer cover, oddly enough though, even after the many BER’s we handled, not once were we requested to return to the same customer and install a new appliance. If they had asked though, the reply would have been “We need a new call booked for this please, with another labour fee or I’m sorry we cannott return for the same fee, it is uneconomical”
Dave.
Indeed, but going back to the actual topic title of this thread and taking into account many of the views here and in the “Going, Going…Gone” thread as well, can I ask one question…
What future do you all see for this industry unless we do something?
K.
kwatt wrote:What future do you all see for this industry unless we do something?
K.
I think our 200 strong membership shows what people think of our future. My PERSONAL opinion is that the big multiples have screwed it up for us all by fighting for market share and large turnover by holding down the price of appliances. (How many times have we heard of one of the largest of these only been kept afloat by it’s own insurance cover premiums ?).
That magical word ‘turnover’ it certainly helped Powerhouse and Northern Electric keep solvent ! I wonder if they would still have been around today if they had concentrated on PROFIT.Flipper wrote:How many times have we heard of one of the largest of these only been kept afloat by it’s own insurance cover premiums ?
Well that little party may well be coming to an end dependant on what comes out of the upcoming CC report. We can but hope that there is more emphasis on profit from selling appliances, or goods, than selling financial services and using the goods as a vehicle to drive those sales.
Flipper wrote:That magical word ‘turnover’ it certainly helped Powerhouse and Northern Electric keep solvent ! I wonder if they would still have been around today if they had concentrated on PROFIT.
Well, it’s not turnover persay that drives these things. From what I can see it’s crazy consultants and bean counters that think that the only way to make a business better is to keep expanding, it appears to me to be one of the fundemental principals they must teach at bean counter school, in real life it does not always work. So anyway, they drive the expansion of these businesses, but that can only be achieved by cost cutting and price cutting as well as selling extra services, like warranties. It’s a new product that they can add on to the existing range of goods with absolutely zero costs to stock. The only costs to put it in play is a telephone line and a body to answer the phone, expand as required after that.
Then it becomes a case of reducing the cost of the goods as well as the lifespan of them to enable selling more and having a constant stream of punters through the door. Retailer nirvana to a degree.
There’s a lot there, as well as a lot implied. Think about it.
K.
Re: THE FUTURE????????
It’s a common problem today. Companies selling products at unprofitable prices and making profit on services and consumables.
Ultimately the greedy public have got what they deserve for not wanting to pay proper prices for products and being gullable enough to fall for the too-good-to-be-true prices on goods such as mobile phones, printers, games consoles ete then complaining at the costs of accessories, consumables etc.
My suspicion is that this whole business with cheap products and extended warranties could be on the way out.
I reckon the current status quo has been artificially sustained by high pressure selling of the extended warranties. As you say K, companies decided that’s where the profit was and sold the goods as a means to an end. The products became cheaper and cheaper but now they are so cheap, that most customers I talk to don’t think it’s worth bothering with an extended warranty as they are now ridiculously priced in comparison with the goods they are supposed to cover. They are content to take the risk and just buy another if it goes wrong.
Prices like £220 for a product and £144 to cover it just aren’t sustainable any more so maybe the tide will turn?
[edited to put in real figures for a Candy washer and 4 yrs extended warranty]
Here’s a little thought that I’ve been mooting about for some time.
The price of the goods is falling, we all seem to acknowledge that.
The cost of servicing those goods is rising, we all seem to acknowledge that.
Those two facts alone blow most manufacturer’s equation to work out the cost of service out the water.
So, given that the costs of service are rising exponentially year on year with labour being a major factor in cost how can we afford to offer low rates ad infinitum as we have been doing? I was looking today at two contracts from WP’s and they in all cases are offering at best rates I would have considered reasnabale for a normal service level 10 years ago, but not today. In some cases the rates were so low that they were actually below the cost to make a call to the customer’s house!
Then we make no profit on spares as well.
It’s unrealistic and not a good business proposition to be a whitegoods repairer, most of us are only here because we’re stuck in the rut. I would bet a large proportion of you would do something else if you could get out.
K.
kwatt wrote:… most of us are only here because we’re stuck in the rut. I would bet a large proportion of you would do something else if you could get out.
K.
A large proprtion of me would ;-/
The low service payments are only sustainable while there are plenty of traders “stuck in a rut” with backs against walls. Eventually, enough will fold or get out of the business, to bring about a scarcity of traders to carry out the IG work at such low prices. That is, unless this can be prevented by representitives of the repair industry such as this and DASA.
Re: THE FUTURE????????
Historically we had “Work Providers” who were the foreign manufacturers setting up local agents in order to provide nationwide service coverage. Bosch, Neff, De Dietrich etc. started out that way very successfully. Using their example, they provided each ‘agent’ with a comprehensive stock of spares (free of charge) and the relevant training and service manuals….a complete package. Full support and full backup, a good call out rate and loads exclusive business out of warranty.
The future?………..oh! no sorry, you got me on that one…pass
Martin
The future……
As an independent sole trader I’ve avoided getting directly involved with any of the manufacturers, but have actively gone into niche service areas; most notably rented/lease property work + pubs/restaurants etc. “Domestic” work is getting more and more problematical as already discussed so this type of work (fix it now, we’re deparate/want a quiet life free of tennant hassle) is profitable. The downside is monthly billing and credit control. However the wife is an ex school teacher and is devastatingly efficient at rounding up the cheques!
Another area is “odd” machines. Most of the independants want to stick with Hoover/Hotpoint/Zanussi. If you start ringing around as a customer with say an Asko, sooner or later someone will say “Phone Chris, he does all the weird ones!”. And it works – customers are so pleased to find someone to take on the machine they will happily pay up. I have one storage crate in the van for Beko bits for instance, contains about 20 parts, value maybe £80 – but the job gets done on the spot. Agood investment.
Dishwashers. We’ve got 40-some independants in the local Yellow Pages and yet there are 5 of us in the whole area who sort dishwashers out. Good niche.And yet you run into the lads in the local wholesalers and they’re all grumbling that they’re only doing 3 or 4 calls a day. I’m typically doing 10 – 12 calls a day (Apart from last Friday – 16 – no fun). There is plenty of work out there – find the right niches!
Regards,
Chris ChantrellRe: THE FUTURE????????
Penguin45 wrote:most notably rented/lease property work
I have to agree with Chris there, we do a lot of work for various letting agents in our area, and as mentioned, they just want a quick solution to a problem most of the time, so getting some back-up with a supply of replacement appliances is also quite handy, if you don’t already retail that is.
I took the step a few weeks ago of emailing all the letting agents in our area by using the weekly property supplement in our local newspaper, it worked quite well, a lot of letting agents struggle to find anyone to take on the whole appliance repair/replacements for them, especially the smaller local one’s.
I think pretty much everyone will have a college or university somewhere in their patch, either of these will mean a huge amount of student lets, usually all in the same area, a lucrative market if you can get in on it 😀
Dave.
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