This post should be titled the ‘trouble with small business cost and pricing structure in Calgary’. Have you ever encountered a business in Calgary that’d rather take nothing than earn a reasonable profit for a quick in and out job, but less than whatever predetermined formula (high margin) it established for itself? That seems to describe the radon profession in Calgary to a ‘T’. Too many small businesses are longing for the heady days of the boom years when a customer would just ask how much and accept whatever sum was requested and hand over the credit card. I think those days are over and not returning.
After a second $2300 quote for radon abatement (have these guys got together to set prices or is this service really worth that sum?) it became obvious that if it was going to be done, it’d be installed the hard and cheap way (by me). The rationale for why the fee was so high was never credible. The first operator appeared to have been using a commission sales guy who’s job was to get into as many customers homes as possible. He’d get a contract and then sell it off to an install crew and pocket the difference. Since I don’t need middleman that aren’t wearing a tool belt that didn’t work for me. Second crew had dubious reasons like a) had to pay for insurance, and b) training and certification cost money too, thus the fee was warranted. My offer to divide those costs by 365 and see what that amounted to per day, which I’d double, a 100% ROI in their fixed cost didn’t get me a deal. I reviewed the total education component necessary to be certified and it was $2500 plus annual dues. Not much in business. My suggestion that home builders have larger insurance bills and overhead than radon guys didn’t gain much leverage in the negotiations either.
My network of contacts in this industry is large and from this I can get a second opinion on cost of service. I contacted a renovator in Colorado who mentioned he’d included an abatement on a house as a deal sweetener. He said they used to pay $1200 but recently had located a contractor at $900. I knew this before my second quote was collected. I tried to leverage this into a lower price than $2300, but still more than $1200 converted from USD. If someone in Colorado can do it for $900, the surely someone in Calgary can make a nice living at $1500.
And then amazon offered free shipping of all the key supplies needed to my do my job, plus an upgrade of a digital monitor for less than $500. I’d purchase help with the ducting and the pipe supplies locally and with a little DIY we’d be abated. Is it really that simple? In the next post, fun with radon part 3, the install (eviction) tale will be told.
thanks amazon, that prime membership is really worth having.