Monday, September 22, 2014
When Prospects Ask for a Cost Breakdown, Say This
Remodeling: Every once in a while we would have a potential client ask to see a breakdown of the costs of their project. Here are some things you might keep in mind when dealing with such a request.
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3 comments:
This is very applicable to proposing a set design for a show. Especially the first few pieces of advice. A lot of people when proposing a set design will speed through it, getting all the necessary information out in the open as fast as their mouths will allow them to say it. Although there is a lot of information to get through, going slowly and explaining everything will give the person to whom you are proposing, a clear idea of what you want, and your proposition will have a better chance of sticking in their head.
I find it understandable that people want a breakdown of what a particular job is expected to cost. It’s just as we work in our own space, a designer has a design in mind, but they need to know what the expected costs are going to be. Although in our case vs. other cases, you can’t go to a completely different company to get the job done, we just work with the designer to get the project to best fit the budget. There are no taking any shortcuts in life. When remodeling a house, you want the cheapest option, you’re going to get the shoddiest work out of it. You get what you pay for. We try to do the best we can to make the best shows possible, but if there is no feedback in between to make sure that things are going properly, it might not quite turn out the way that you ‘the designer’ wants it to be.
Contrary to what Evan has stated, in the world of commercial entertainment (themed attractions, for-profit theatre, trade shows, events) the client can most certainly decided to use a different company if they aren’t pleased with your proposed cost or the bid assessment process. You could be competing against a number of companies for that particular project and like the article’s writer says “you have to sell them on the idea that your company is the best choice.” Now another shop could easily still undercut your price, but the potential client may choose to disregard that and still choose you if sell them the better product, regardless of price.” He makes a good point, that it may be difficult to be transparent with your client about the costs if that’s what their looking for depending on how you apply your makeup and where. Some companies will have a sell price for material and labor hour that is a predetermined amount higher than the market cost, and then it’s not necessary to worry about where you “stuck” that added cost within your budget, it’s embedded, and you’re not hiding anything. You’re selling a product. All retailers do the same thing, they sell you items at the market price, not the cost of the item…its simple economics. You can’t survive as a business otherwise. I would think it would be less wise to add a line item for “Expected return”, it’s almost too transparent. They can directly see the markup…and that can hurt you even more if they find it unreasonable. Additionally, it’s not uncommon for the client to use the breakdown to help prioritize what parts of the project they think are the priority, this is true for both the entertainment industry and remodeling/home building business. A client can very easily think the price is a little high, but still wants to hire you…so maybe they decide not to have you install a new fireplace, or maybe you cut a drop or the show deck from the design. It’s better for you to give them the option to change the scope of the project, instead of encouraging them not to hire you.
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