[Small but perfectley formed]

Had letter informing us we now have to give minimum 3%discount on prices  so they can achieve satifactory margins .what about ours?.Anyone else had this letter?

[martin19842]

hi there

well thats easy

letter back 5% increase due to fuel costs.

seriously, read the terms and conditions of the contract that you signed, you shoiuld find a clause in there definign that the costs are fixed for the duration of the contract. ( duration of the site development )

the other thing is to adopt an aggressive monitoring process, and gain an extra reclean here or there, to gain back the 3%

regards


martin

[J. Deans]

How many contracts do you have with this developer?
Are they talking about future, or current contracts?
They cannot ask for a discount on an existing contract!
Martin is right. This type of contract is always 'fixed to completion of works.'

A couple of years ago, one developer asked us to do what we call 'Front Elevation Cleans' to 12 stock/holding properties, where they did not want to pay for the full stock/holding clean. This involves cleaning the windows/frames, down-pipes, metering boxes, front door and pathways etc. To make the front of the properties look acceptable to passing viewers and the general public.

We agreed and charged them half the cost of a stock/holding clean and they wanted them done every week! This was a bit expensive I know, because each plot only took 15 - 20 minutes (including sorting out keys and movements between the plots) So about 6 months later they realised they had gone well over budget and asked us to drop the price. We had a good run out of it and readily agreed, because it did not form a part of the main contract! We politely explained that it was not our fault that we were being asked to do to much and everyone was happy with that! We have had further contracts with this developer since.

The point to make here is: do not budge on your prices for the fixed contract, but always be flexible with 'Additional Work Requests.' If Site or Sales ask you to do extra tasks, always be as helpfull as you can (and get a signature for it) Bill them for the work and when the brown stuff hits the fan in the accounts department months later - plead ignorance and only then offer to reduce prices where appropriate (for future requests) to 'help them out.'

Most development contracts of this type will almost double the initial contract value from these 'Additional Work Requests.' Use them to your advantage.

[Small but perfectley formed]

What the letter is saying in not so many words is if you dont lower your prices on existing work you will not get any more. We have worked for them for many years and if you try to argue your point they just get someone else .

[Bertie Boo]

Sounds like they have backed you into a corner  swines.

Stephen