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Low Bidding ?

Posted: Thu Mar 16, 2006 1:45 pm
by brightway7642867
Does anyone else have a problem with competition in your area that will bid $ 13.00 to $ 15.00 per sweep for small lots such as a busy grocery store and a couple of small shops This is based on 5 - 7 nights per week

Re: Low Bidding ?

Posted: Thu Mar 16, 2006 9:40 pm
by Dwan
brightway7642867 wrote:Does anyone else have a problem with competition in your area that will bid $ 13.00 to $ 15.00 per sweep for small lots such as a busy grocery store and a couple of small shops This is based on 5 - 7 nights per week
It would not be a problem at all. I don't try to low bid. I know what I need to make a living and pay for my overhead, That is my bottem line. I will spend quality time with my wife if under bid, or find something else to do.
For thet kind of pricing I would check your city and state to see if they have a contractors and business license, if not drop a dime on them. Who ever is doing it must not have any overhead or they are paying to work. By the way I set my minimum price @ $125 your may be less.

Low Bidding

Posted: Fri Mar 17, 2006 7:34 pm
by comsweep
I agree with Dwan.

Answer

Posted: Thu Mar 23, 2006 7:28 pm
by Tom_in_CA
I disagree with Dwan. It IS a problem.

It'd be nice if the shopping centers paid for quality, but unfortunately, most of them are going to take the lowest bid regardless. This leaves the guy who is conscientious, to take up basket weaving. I've even gone back a month later, seen that the island corners aren't blown out, and they are flying so fast, they don't get the grit, pebbles, etc... When you try to point that out to the manager (as if.... "the bid wasn't fair"), they just blow you off.

So quality doesn't pay in the night work anymore. Maybe in high-rent Beverly Hills type neighborhoods, but not the rank and file standard neighborhood centers, which are invariably managed by some mega-out-of-town company, whose only job is to get the lowest expeneses for their investor's returns.

These "no habla englis" companies are the reason we sold off our night routes, and are strictly paving related sweepers now.

More on this

Posted: Fri Mar 24, 2006 12:12 am
by comsweep
I refuse to become a low bidder. We have the reputation of being THE BEST. So all the low bidders can have the cheapskates and I'll stay in business. You get what you pay for. Quality costs.

Posted: Fri Mar 24, 2006 2:05 am
by Dwan
Tom does have a point. When national mananagement co's come in and try to set pricing it hurts everyone in the business. The property owners get shotty work, the sweeper gets the short end of the stick. low pay and bed rep. He has found an answer. Don't do that tye of work. We can't have every job out there.
I still sell quality If asked for a bid I put down what it takes for me to make a profit. If I don't get the job so be it. I move on, it is still not a problem. If it was I would not be in this business.

Re: Low Bidding ?

Posted: Fri Apr 14, 2006 11:11 am
by FED-UP
brightway7642867 wrote:Does anyone else have a problem with competition in your area that will bid $ 13.00 to $ 15.00 per sweep for small lots such as a busy grocery store and a couple of small shops This is based on 5 - 7 nights per week
This is becoming a bigger problem day by day here in Kansas City. What I don't get, is the 2 company's that have been here the longest, are the ones out giving quotes for $15 to $18 per sweep. Then again if you are only on the lot for 5 min or less, that's good money.

I just refuse to drop the quality of my work to compete w/ this.

With in the past year is when the prices started dropping quickly, when everyone knows w/ the price of fuel it should be the other way around.

Then again this could be a sign of a failing business just trying to get quick contracts, to look more impressive to a buyer for the company. :?

reply

Posted: Sat Apr 15, 2006 1:30 am
by Tom_in_CA
Hey "Fed Up", to add misery to this story:

2 established companies in our town got tired of a new company that was going around soliciting and under-bidding us. So we went to him and said "let's put a stop to this ping pong match, and all agree to stop stealing each other's business! This under-cutting will only hurt us all in the end, and pretty soon, NO ONE will be making any money". The newcomer seemed to agree to put an end to the price wars, and said "I'll think about it".

Later, he calls us up, and says "let's meet to discuss the end to the bid wars". We all met at an appointed time and place, and discuss a truce. We explain to the newcomer that our 2 established companies only bid at the on-set, and don't solicit each others accounts after that, nor entertain bid solicitations from each other's existing customers. Well guess what happened? The guy was BUGGED by the district attorney, and we got our b*tts wrung through the legal ringer :shock: Yup: guilty of collusion, bid rigging, etc....

So I guess it's mandatory that you HAVE to under-bid your competitor eh? It's illegal to have "professional courtesy" and leave people alone? I just don't get it. Aarrrggh. This is why I eventually just got out of. We only do municipal scale sweeping now (grinding, asphalt, const. etc...)

DOH!!!

Posted: Sat Feb 17, 2007 8:05 am
by TILCO Vanguard Inc
Forgive me but...that was basic.

It's illegal.

You seemed stunned that you were the bad guy here!

reply

Posted: Fri Mar 09, 2007 7:35 am
by Tom_in_CA
Hi Tilco. Thanx for the reply. Yes, there is such a thing as collusion and perhaps we crossed that "line." But........ help me out here: if my competitor's customer calls me (let's say, a shopping center), and wants a bid. Let's say that I know for a fact that qaulity is not the problem there, and it's merely an annual "shop around" by the penny-pinching management. Now perhaps I could make a stab at it, and end up taking it away from my competition. Am I REQUIRED (by law) to bid? What if I don't want to? What if I don't want the revenge of my competitor, who would be torqued that I weaseled him out of it, for a mere $20 difference?

What was happening here was, if one guy under-bid another guy's shopping center, then........ the reciprocal would happen the following months (as if they were saying "I'll show YOU!") and round and round it went, till quality suffered, and it was just mean-play, not legitimate bidding.

So can there be "professional courtesy"? That's not a made up word. Attorney's use that phrase. Try getting your business half-way finished with one attorney, and then..... switch gears, take that business to another attorney, and ask "how much per hour will you charge me to take over this business?" I gaurantee you that they will decline the work, when they hear you already have a working relationship with another, EVEN if they're hourly rate could be beat. Attorney's call that "professional courtesy". What's the difference between that, and price-fixing? I dunno, but it's wide spread, and they all do it with impunity.

I just know that when 2 company's decided to stop purposefully under-cutting each other in the sweeping service, they were told that is illegal. I was almost afraid to answer my phone after that, because I would be REQUIRED to bid, and would be REQUIRED to bid lower, lest it reak of fixing?

I guess about the only answer to this is to not have any meetings to agree to be friendly. You can be friendly, but it must be "wink wink"? Yet airlines did that, and were STILL guilty, I've read. Even without recorded meetings and written proofs, courts could still say it was wink-wink manipulation, right?

Here's another scenario: There are a few broom delivery companies in my part of California. I happen to be on about the dividing line, of north/south, of where two of these competitor's routes are. When I tried to recommend our delivery company's services to another sweeper further north than me, I was told "we don't go up there. That area is served by so & so delivery co.") To which I asked the guy "well, it's only XX miles further, and they'd like a bid, even if means the extra travel cost". He replied that they, and the other company, have an agreement, to which parts of CA they will service, and they don't trample each other's territory (or something to that effect). Is that illegal? Are they required to drive out of their way, if they are happy with their business range they have at present?

Now I can certainly understand how 2 company's could collude and make a certain market pay more, for shoddy work, because the customer has no choice (if only those 2 providers existed in that market), but when it is not that at all, and merely 2 company's that don't wish to be stupid and fight, .......... how can they do this safely, w/o fear of doing something illegal?

Sorry this is so long, but it is a sticky issue in my mind. I had to pay big bucks to settle out of court with the district attorney, and have never quite felt right about it (was cheaper than fighting it).