What is a fair profit for a pool builder in NY/NJ?

SwimIn2012April 28, 2012

How much profit is reasonable for a pool builder that is subcontracting most of the work? I am trying to get a very good quality, approx 20' x 40', 8' deep gunite pool built in NY suburb. (no fancy stuff/no decking) If I could get a pool builder to build it for $10,000 profit, I think that would be fair, and it would be worth it to me. (This would be $50,000 total based on 20% gross profit over his cost, assuming his cost is $40,000). If it is a lot more than $10,000 - it might be worth my time to do an owner/builder pool. I would like to negotiate the price with a pool builder, and I do not want to be unreasonable. Thank you very much for any help you can offer (to both me and my prospective pool builder).

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IMHO, what his profit is is not your concern. Sure, you want to get what you want for the fewest of your dollars but you also want other things too such as:

1) The PB to be there when something goes askew, even 5 years from now. Attention spans can cost some.
2) Subs that know what they are doing.
3) The lack of taken shortcuts that could lessen the quality of work.

I am sure there are additional things that the PBs could add to my short list. I am not saying don't negotiate but as you mentioned, being reasonable is important. Make sure you are comparing apples to apples using multiple bidders.


    Bookmark   April 28, 2012 at 12:14PM
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I agree with Scott here.

FIrst off, it will be impossible to really know what their profit is, as they all have different agreements with subs and purchase in different amounts.

If you have the ability and know how to do it yourself, you can figure out how much more each quote is than it would cost you, and you can determine if that amount is worthwhile for what you are getting for it.

I found that for the pool itself, most of the builders were within a few thousand of one another, it was really a lot of the other work that varied.

    Bookmark   April 28, 2012 at 1:44PM
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Thanks to you both. I have priced out the various components of my pool based on exhaustive research, and I realize that if I were to hire the individual companies myself it would certainly not be going in this year, (since I would have a lot more research to do) so I would prefer to hire a pool builder. I have put a value on this of $10,000. That is what it is worth to me to not have to try to do it myself.

The pool builder I prefer (out of 3 estimates received) is adding $17,000 to my estimated cost. I think that is too much, so I will ask them to lower it. What I am trying to understand is if pool builders work for that type of profit. I do not want to ask for a ridiculous reduction.

In my experience dealing with contractors and business suppliers, there is always room to lower the price. This is based on many things, the most important imho is the profit.

Thanks for your opinions.

    Bookmark   April 28, 2012 at 2:42PM
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Is profit now a bad thing?

Think about this. If I can't make a decent profit that meets my overhead costs and then some, and you have no idea what those might be, mind you, I won't play in the sand box with you, figuratively speaking.

I control my profit as a company, not the customer. I play fair and straight but I would never advise a customer what I gain in profit on a job. I earn the added value that I am worth. I am not the most expensive but neither am I the cheapest.

Buying a pool is a lot more than buying car insurance, stocks, a mutual fund, etc... Having a great relationship with the PB is important in so many intangible way for those that have never do it or anything like it. The lowest price often isn't in the long run.


    Bookmark   April 28, 2012 at 5:16PM
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Hi Scott,
I think you are misunderstanding my question. I do not think profit is a bad thing. I understand that a business will not stay around very long if they do not make a profit. But it is a bad thing if I am taken advantage of because of my ignorance. You may not do this, but plenty of people out there do. That is why I am here, trying to get information. I found a pool builder that I think will do a good job, I want to ask for a reduction in price, assuming they will expect it, and because I feel the price is too high, but I do not want to offend them by asking for too much. That is why I am asking here. I am not looking for the cheapest price - other estimates were lower. I am putting extra value in the fact that I think this builder will do a better job. I guess this is too sensitive a topic for me to get an answer here, so I will just have to take my chances. Thanks for your input.

    Bookmark   April 28, 2012 at 8:37PM
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Good luck on this, let us know how it goes. I am in the same boat, and builders are all over the place here. I know there is room to beat down the price, bit I am never a fan of haggling.

    Bookmark   April 29, 2012 at 4:18AM
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swimin2012, scott hit the nail on the head. When we put in our pool we got several quotes, however we did not go with the cheapeast or the most expensive one. We ended up going with a family owned and operated local company. It is all about relationships and comfort level. He showed up at our house on 4th of july and listened to us, actually walked our property. The wife gave him a drawing of what she wanted. He did not have fancy computers, 2d/3d drawings, and wore shorts and a t-shirt. We felt very comfortable with him. He then directed us to 2 other pools to look at which he built. He only asked us for 1k to pull permit and the rest of the draw after things were performed. We liked him so much we started inviting him to some of our parties and functions. To this day I can call him and he answers promptly, no voicemail etc. BTW he sends over potential clients to look at our pool. Maybe I paid too much or too little. I am very happy with our finished product 3 years later. The whole point of this is who cares how much profit someone makes, as long as you feel comfortable and feels that he brings value to the table. Hope this helps.

Here is a link that might be useful: Our pool build in Jacksonville

    Bookmark   April 29, 2012 at 7:27AM
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I agree you want to be careful on this. If you feel that the pool contractor's general contractor fee and sub relationships are more than you want to pay and you've got the ability and time to do the work, then you should take it on.

I would be careful of pushing any type of services work down on price too hard. Generally you don't want to be the lowest price job they have and you don't want such a good deal for you that you're putting their business at risk.

    Bookmark   April 29, 2012 at 8:35AM
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Thanks to all for your replies.
dpautz - I will let you know. Good luck with your search.
brentr - I took a look at your pool. I can see why you are so happy. I hope I will be as lucky as you!
donnaw - This is what I am worried about. I think I will just ask them for a reduction and see what they come up with. If I feel it is too high, I can always do it myself or put in a vinyl liner pool, which is less expensive and which I am also considering (but do not prefer). I think we would be very comfortable working with this pool builder, so I do not want to start off on a sour note. Thanks again to all for your replies.

    Bookmark   April 29, 2012 at 9:08AM
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