Where does fraud start?

[Phil Pascoe]

An acquaintance did a job for someone (living in an area where people tend to have more money than sense). He had a quote for part of the job from a (rather up market) timber supplier of £800 then got the wood on line for £500. She accepted the original price, and this was what he charged her (the rest of the job was an good earner, so he didn't have to compensate for anything).
I would have been uncomfortable with this, but that's probably one reason I'm poor.

 

[Trevanion]

That’s nothing, I know a couple builders that buy materials for their own work at home or even other jobs and put it somewhere on some other customers bill.

And things like that and your post are really just the tip of the iceberg, the question should really be “Where does the fraud stop?”

 

[Phil Pascoe]

Actually this chap had already priced the materials for his own home job into it. :lol:

 

[sunnybob]

The answer is with the "more money than sense" statement.
I often hear people whinging about the rip off price they get charged, and when i reply, "dont pay it" I get a blank look.
I always find out the general price of materials and then ask for several quotes, knowing that a general rule of thumb is materials should be around 60% of total cost.
but then again, I have been credited with some sense (occasionally)

 

[doctor Bob]

I always find out the general price of materials and then ask for several quotes, knowing that a general rule of thumb is materials should be around 60% of total cost.

I'd go bust very quickly on those figures.

 

[Steve Maskery]

... a general rule of thumb is materials should be around 60% of total cost.

I'd go bust very quickly on those figures.

Absolutely! Depending on the complexity of the job, the percentage of the materials could be anything down to approximately zero. The cost of the labour would be several/many times the cost of any materials.

 

[tony_s]

At the same time it seems to me that a humble chippy has, in the eyes of some, to account for every penny (I mean, he doesn't even pronounce his t's so he's obviously a dishonest scum-bag). Wheras, say, a legal practitioner can just add zeros yet is a pillar of the community.

 

[Lons]

I'll respond to that as a retired builder.

The customer has accepted the quote so I don't view that as fraud although I never did that as I'd be uncomfortable with it and would have given back at least some of the savings however I only ever accepted work from customers I felt I could trust or were refered by existing customers and I saw that trust as being both ways.

There are some very dodgy builders out there but also very dodgy customers. I had several instances where customers attempted to sqeeze discount after the work was complete which IMO is morally just as bad as Phils' example and a few slow / very slow payment but those people were quickly blacklisted and no further work accepted however much they begged.

Profit on top of overheads, wages and material costs is a valid and essential part of business, how else would you be able to invest in and expand the business as well as cover unexpected costs and a failed business is of no use to a customer who wants that business to continue trading in case he has future callbacks.
Materials were usually priced at retail with some exceptions, I rarely would accept work unless I provided the materials ( customers are often very bad at project management ) and I had full control, that way I could ensure it was carried out to my standards and on time. If someone wasn't happy with my price and asked me to cut corners I refused and suggested there look for others who would do that, changing the design whilst retaining quality was a different matter.

I had my business for more than 18 years before retiring and it was very successful though harder work, longer hours and I was paid more managing companies for other people. It was built purely on reputation, I never overcharged but was far from cheapest either, my opinion is that whilst everyone would like a RR for the price of a Mini in reality what they really want is a good job for a fair price. The customer has a duty to himself to do the research and it is after all his decision whether to accept or refuse a price.
e would you be able to invest in and expand the business as well as cover unexpected costs.

The vast majority of small business owners are honest and fair and they work bloody hard, long hours in the business which has undoubted rewards but also drawbacks often having the added responsibility of providing a livelihood for employees, sometimes a heavy burden.

Bob
( thankfully now retired )

 

[doctor Bob]

Great post Bob (Lons). Sums it up.

 

[Phil Pascoe]

I have a friend who was a builder for years before having two heart attacks caused by the stress of chasing debts - he drives for Tesco now and loves it. The chap who did our last bathroom, an old friend of my wife's told us he had only been really badly seen off twice ............. once by a solicitor and once by an accountant.

 

[sunnybob]

Ok, I admit my 60% materials figure was based on 40 years ago, and I realise material prices are cheaper than they used to be and wages are dearer than they used to be (relatively).
But I would still question huge estimates, as a matter of course.

 

[transatlantic]

Take for example painting/decorating. The materials are nothing compared to the labour.

The problem these days is that you can be unscrupulous, get caught, get a bad name, ...but then simply start up a new business under another name.

 

[Lons]

The problem these days is that you can be unscrupulous, get caught, get a bad name, ...but then simply start up a new business under another name.

Depends where you live. Try doing that in a rural comunity and you'll come unstuck very quickly indeed!

Dodgy businesses never did my business any harm, whilst they give various trades a bad name generally, the honest traders become even more in demand. During the 18 years I was in business I advertised only once, apart from my signwritten van and that was a flyer drop when I first started. Everything else was purely by word of mouth. A good reputation has to be built and nurtured, a bad one spreads like wildfire.

What always surprises me is that people are prepared to spend large sums of money without carrying out due diligence and proper research. If you're not 100% sure about a company or the price, look elsewhere and the dodgy guys wont get the work.

 

[Lons]

I have a friend who was a builder for years before having two heart attacks caused by the stress of chasing debts - he drives for Tesco now and loves it. The chap who did our last bathroom, an old friend of my wife's told us he had only been really badly seen off twice ............. once by a solicitor and once by an accountant.

I had three instances Phil that really annoyed me, one was a neighbour, a senior GP with a theatre nurse wife earning £150k between them, ( he boasted about that ), he was very slow to pay me nearly 5 grand even though I hadn't asked for a penny up front, had bought expensive materials and done some work FOC. Second was a financial advisor and I had to ask his missus to get a cheque from him for a substantial kitchen extension. Third was an accountant and I eventually said I would do no more work for him if all payments wern't made in full within 7 days of invoice, his wife had a huge list of renovation work that lasted years.
What I learned very quickly was wives don't like being embarassed and are very adept at making their husbands toe the line. :wink:

The IFA and GP were both tight as a fishes a**e and co-incidentally both Scottish, no insinuations there btw I have a number of very generous friends from north of the border. :lol:
Those 2 were blacklisted and I refused work from them for years afterwards.

 

[doctor Bob]

Those 2 were blacklisted and I refused work from them for years afterwards.

Yep, I just say we are involved in big projects, won't be able to fit them in and advise them to find an alternative maker. All nice and polite but quite clear.

 

[sammy.se]

I just find it hard to find the good, honest, companies/sole traders. I do try and go by reputation, but people's expectations are so varied, one person's recommendation can't always be trusted.

As a customer, the thing I value most is transparency and a commitment to doing the job properly. If costs go up during the job, I understand, but only if it's genuinely unforseen. Is rather pay a bit more but have and honest person to deal with.

Tried those online referral websites, the quality of the traders was still dicey.

Maybe I'm just unlucky.



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[Lons]

Those 2 were blacklisted and I refused work from them for years afterwards.

Yep, I just say we are involved in big projects, won't be able to fit them in and advise them to find an alternative maker. All nice and polite but quite clear.

You're more subtle than me Bob, I told them exactly why. :lol: I was always polite of course.

I had a mate who owned a tile shop and employed a couple of tilers and a plumber. He took on a £20k bathroom job for a wealthy Pakistani doctor price all agreed in writing and typical of our trades the lads did loads of extra work, of the usual type "while you're here can you just".

Job finished and the customer said " ok very happy with the work but now let's discuss price ". My mate ended up cutting his losses eventually and the customer paid him less than £14k for the job, he couldn't wait the month needed to take the guy to court.
Doesn't take many of those to put a small company out of business.

 

[Lons]

I just find it hard to find the good, honest, companies/sole traders. I do try and go by reputation, but people's expectations are so varied, one person's recommendation can't always be trusted.

It's definitely not easy Sammy and the only way really is to ask the companies for customer referrals you can follow up and visit, if you can get recommendations from friends and family they're usually the best kind.

As a customer, the thing I value most is transparency and a commitment to doing the job properly. If costs go up during the job, I understand, but only if it's genuinely unforseen. Is rather pay a bit more but have and honest person to deal with.

Exactly my opinion Sammy and I think what most customers want.

Tried those online referral websites, the quality of the traders was still dicey.

I was approached on a regular basis to join the lists and refused as I didn't need to but I got the impression at the time that all they wanted was my membership fees so I'm sceptical. Others with more relevant experience will likely disagree.

 

[Phil Pascoe]

The rule around here was never to use anyone who advertised in Yellow Pages.

 

[transatlantic]

I know I shouldn't generalise, but I had my patio done last year and it's completely put me off having any more building work being done. I was quoted for the job to be done in 5 days, and it ended up taking about 3 weeks. Not because of the weather, but because they just wouldn't turn up. I'd have to phone to ask where they were, and they would give me some crap about waiting on materials. But really, they were clearly on other jobs.

Unfortunately, I'm not the type of confident person to stand up to them (so their target market!), as I was worried they'd do a bad job or not bother finishing it.

I'm so glad I paid on job completion, else I would have been in a right old state.

In the end, I was pleased with the work though. Just have to see if it will hold up!