Your GC isn't fibbing to you, he's charging industry standard product markup that any contractor would charge. Product markup covers the time it takes him to select and transport the product and is totally separate from any labor charged on the job.

Two of the GC that I interviewed only provided the labor and material cost, so I assumed their ��profit�� must be distributed to each of item.
But the GC I picked, his list has a ��Builder margin and supervision�� and that is about 23% for the total project price that he estimated.
Besides, he brought us to the manufacture��s office, then we pick the wood, color, door style and some details.
The lady from manufacture said their guy will deliver and install the vanity and that is all included in the $1600.
Unless, I have to paid GC ��where to shop��!!!

But thanks for response

There's nothing unusual about what he did. It sounds like the manufacturer was willing to pass on the contractor discount to you is all..some vendors will do that. You might ask the manufacturer what 'retail price' actually is, or perhaps look for it online and see what the price is.

Really sneaky, isn't it? I know I could use an extra $400+ today even though I'm already making a tidy profit as outlined in my contract--let me think how I can get it? Ooooh, I know! I'll dupe my customer by telling them I am paying a higher price than I actually am and bill them for it! Around 20% ought to do--that's about the same as the discounts I get from my suppliers, so my customer will never know the difference. Brilliant!!! Let's see, that's an easy $400 on the vanity, $120 on the faucet/shower fixtures, $50 on the toilet, $60 on the tile, $60 on the light fixtures/exhaust fan, & $10 on the towel bars--that's an extra $700 payday. Brilliant!!

I don't agree with the way many contractors do business in that sense. The cost of the item is the cost the person who actually forked out the money to the actual supplier paid, not the retail cost they got a discount on IMO. The part about this difference covering the cost of the GC picking out the item and transporting-- BS-- you picked out the item and the supplier is going to deliver it to him most likely and as you found those fees are already built into the discounted price given. What you often hear is that the difference covers the cost of his warranty of the product for a year--so if your drain leaks & that new vanity is ruined that extra money will cover the cost of replacing the vanity, repairing any floor damage and fixing the leak.

I would go back to the GC and ask why the difference. It does sound like this is a variation of a cost-plus situation to some extent since he did outline the costs with his cut separate. (He will likely be seriously PO'd about the supplier telling you the actual price.)

If that meeting doesn't go the way you want, you can try these 2 things:

1) Get the discount price on whatever you're there to pick out from the supplier that you have been steered toward by the GC and insist on paying for it yourself right then and there from your pocket to knock the GC out of the loop. That ought to also get your point across.

2) Buy online or at other suppliers and supply the GC with the item.

In either scenario, you will need to make sure he credits you the allowance on your final bill. Do watch for him to mark up other areas to try and make that money back, though. Asking for a copy of all his invoices to verify the price he actually paid will not help--it's common practice for the supplier to make up 2 invoices--the end customer one & the actual one that reflects what the GC is paying. Also be aware that his warranty will likely not cover anything other than what actually fails.

Good luck!

Oops! Forgot the granite in the extra profit pricing--add another $100. You know, I think I'm in the wrong business!

I'd also let him think that you're willing to walk away from this deal and hire someone else to replace him (even if you're not). If he knows he's got you, then he has no reason to negotiate. I'd also double check any prices you are given online before placing a final order just to make sure you are not being snowed again. BTW--Ferguson tends to be on the high side.

I really, really want to like and trust my GC, because there are some other projects that needed to be done in my house.

Howere, the lady from the manufacture told me that the GC told them about the budget and asked them to work based on the budget.
So there is no retail price or discount.

When I mentioned this to the GC, he just said that he is sorry and the price should be $1600 not $2000,
then he changed the subject like this never happened.

Maybe I am too naive for this business, but I feel that I am dealing with a black hole.
And I do not know what I will get at the end.
As a consumer, this is kind of frustrating and tired.

Thanks for your suggestions Mydreamhome.

I am going to order the faucets, sink, tub....online, even I have to figure out what to order piece by piece.
The otherthing needed to be worry is the Flameless Glass, he keep telling me how expensive it is and it sure will over my budget.

I was surprised by the way contractors make profit on everything involved in a project too. Fortunately our GC is our friend and not charging us anything and passing all discounts to us, an example: when we picked out our tile, I asked the tile store what the contractor price would be and they told me, I told our GC and he said that's about right and you can go ahead and buy it at that price but the tile contractor will expect a 10% markup on the tile on top of his bid for doing the work, that sounded crazy to me since the tile guy was definitely not doing the job on the cheap, but I guess it's the way business is done.

What is flameless glass?

Ditto! I my eperience, there's two widths of tempered glass. It has just the slightest greenish tinge, but after the bath is done, you don't notice it. There's another type that is completely clear, but the cost differential is substantial.

I think that's what you mean. Yes, it's more expensive, but worth EVERY penny! Price around and there are two different widths. The thinner is fine if it's a normal shower door. Don't forget like I did-- Make sure to get a towel bar handle on the door! LOL

All that matters is the original quote in the contract you signed. The GC is bound to those numbers. ANY over runs price wise are his to eat. Take you contract to him and hold him to it. Simple.

You have an original quote. He does not have the advantage if you have that document. That's what you pay for the things on the quote, and that's all. If you do not get what you ordered for the price, you don't pay for it. Don't give him all the money up front, and don't give him the final payment until he releases the mechanic's lien and everything is just as you agreed.

Renee

Mydreamhome,
I am sorry it should be "frameless glass".
We are thinking about a "walk-in shower"(no door) with frameless glass.

Arcy, hosenemesis,
The original quote is based on the estimate(allowance).
So if we pick something that is more expensive than the quote then we have to pay the difference.
On the other hand, if we pick something that is cheaper then we should be able to save some money.

And one stupid thing is that we believed since he "honestly" pointed out how much he is going to make((Builder margin and supervision!!)so he is not going to make money on the materials and we agree at the beginning that we will paid GC then he will paid the vendors.

Two years ago, one of my neighbor hired a GC to replace a expensive soft water machine.
At the end she found out that GC charged her almost double than the market price. When she questioned her(a female GC), the answer is "you have the money!".

Thanks for everyone's response.

I'm not "contractor", but, In my line of work, I sometimes find myself in much the same situation.
However, WHY LIE? WHY BS?

When I write an estimate, or a customer asks how much is "this"?
I give them MY price. (not my cost, not my markup, not the shipping, not the day of the week). Simply..MY price.
THIS is how much it is if you buy it from me.
If you don't like that price, but it somewhere else. I'll still install it for the labor quoted.

NOW, if you buy it from me, and there is a problem? You call me and I'll take care of it. You don't need to call the people that made it, That's my problem.
Even if it's not "my" fault. It IS my responsibility.
IF, you buy it somewhere else, and simply have me intall it? I'll only warranty the initial labor to be done correctly.

BASICALLY: I'm going to price you that vanity at $2k. If you say okay? I'm going to do my best to find one for $100 dollars. IF I can't do that, and wind up having to pay $3k for one? So be it. (either way, your cost remains $2k).

Dando is spot on.

I don't care if you find the same item for a cheaper price somewhere else. If you buy it and bring it to me, I'll install it for labor charge; but I won't warranty the item.

It's like any DIY job. You can always find the items & parts cheaper than if you paid a contractor to do the entire thing.

"I don't care if you find the same item for a cheaper price somewhere else. If you buy it and bring it to me, I'll install it for labor charge; but I won't warranty the item. "

This.

And do not expect me to pick it up.

Every minute spent going to a store or warehouse is work time.
Or having someone wait around for a delivery, or searching for a vendor.

And if the product is late, you get to pay for another trip to the job site for installation.

I have a few vendors i prefer, since they have consistently had items in stock every time.
they are NOT the lowest price place many times, but making ONE trip to pick up everything is worth it for both you and the tradesman.

Remember all the jokes about

"How many trips to HD are needed to finish a job?"

"One more."

Having everything on hand and available the first time is part of the cost of hiring the work out.

--- i agree with dando above....

in this instant informational age... people will/may pay for something - then get home and look in up on the net and be like, durn could've/would've bought it elsewhere for cheaper.....

the issue i see here is the way the GC approached the pricing of the item --- giving the homeowner the idea that they were getting a "deal"--- when in reality they were probably just paying retail for the vanity -- just not from a retail store - retail from the GC.

just read brickeyee's post and agree with your initial statement....yet you would be surprised at how many people will not even contemplate using different suppliers even though considerable savings are to be had -- just b/c the other store is convenient. had one GC tell me they had built a house and the homeowner had bought the supplies elsewhere --- and then he kinda grimaced and said -- he may have saved some but, but , but.. the materials werent as good quality as what we usually get.

i understand there is a difference in quality of materials - but sometimes people can just be hard headed - and they have the right to be.

didnt intend to stray too much

If the customer purchases from the GC he or she IS paying retail. Plain and simple. Thinking otherwise is foolish and setting one's self up for disappointment.

Now, there are as many levels of retail pricing as there are contractors. Some are low, some high and most are average. Ditto with quality and service.

This is simply not a transaction that can be spread sheeted, decision treed, best practiced to a favorable outcome with the lowest price anymore than a heart transplant or transmission exchange.

There will always be an amount of risk and uncertainty as well as the potential for finding a lower cost during or after the experience.

Brickeye - you are missing a nice payday and a vehicle to promote goodwill by not picking up customer's purchases. "Every minute spent going to a store or warehouse is work time. " Correct - and if you are working for wages and not a contract price - you INVOICE for every minute or fraction of an hour spent working on the project, no matter how trivial or mundane.

If my attorney picks me up from the airport he is billing for that time in addition to the mileage and any tolls and fees. Bills if he talks to me on the phone for 5 minutes too.

Slowdown- that is sometimes true (hard headed customers). In my experience it's about as often as times a contractor has no real clue about product's quality, value or if there even is an alternative. He'll simply use it because it's convenient, or he's dealt with Bobby down at Snorts for decades, or he likes the fishing trip Yellawood takes him on every year, or

Well, isnt the GC getting a contractor fee? If I am paying him 10% on everything, then I'm not expecting an additional mark-up. If there is a mark up then be honest with me up front. Then I will decide if it's worth the hassle for me to buy it myself. I think the customer gets upset not so much when they have to pay more but when they feel deceived.

"Brickeye - you are missing a nice payday and a vehicle to promote goodwill by not picking up customer's purchases. "

My clients would have a fit if I billed them that time.

I might send a worker out to pick something up, but he in on the clock and miles driven.

I renovate old houses mostly, but have a customer base that keeps things rolling along.

Strictly word of mouth high quality work.

New customers interview me, and I am interviewing them.
We do not 'mesh' all the time.

I probably turn down about as many as turn me down.

It's showing the mark-up (10%, 20%, etc) that I want no part of.
I know it does to many folks, but, it SHOULDN'T! matter how much I pay for something. All that SHOULD matter is how much it is, "to you".
"$$ is what I want for the "item" itself. Take it or leave it." (yes, that is harsh, and I wouldn't say exactly that, but, that's how it really is).
My philosophy has always been to price the part, then go find it after given the "okay". (how much I make, depends on how well I did my homework). And, This philosophy does backfire on me every now and then.
BUT, the price I quoted, remains the same for the client.

Not really related, but, I'd make sure you, as the final user, is fully aware of who to call when something isn't right. Tomorrow, next week, five years from now. You need to know WHO is going to take care of problems that arise down the road. AND, you need to know before you pay a dime to anybody.

the last statement above about who to call made me post this quick opinion/story...

we have interviewed several GC (whole house turn key) over the past year and one in particular was selling us on the fact that in a couple of years - if something goes wrong, all we have to do is pick up the phone and call them. I wasnt being rude, but i said, if i have a plumbing issue, I will call a plumber, and if I have a HVAC issue I will call the heating and air company...(pretty much the subs that worked on the house)... after the first year the GC in my opinion is out of the picture.

that may be pretty crude - but unless the problem is structural related, that is the way i feel.

"My clients would have a fit if I billed them that time. "

Then, like you say: they are welcome to pick their purchases up themselves.

Down the road, yes...plumbing problem, call a plumber. Fridge dies, call the manufacturer, etc.

I mean within 90 days, 6months, 1 year...or whatever time period you feel is fair, or that your GC feels is fair.

Example: You buy a fridge and a kitchen faucet at your local Appliance Store. They come install the stuff.
30 days later, faucet starts leaking. You call them, and they say call the manufacturer.
That's not right.
For a certain time period, (I like 1 yr). You call the people you paid, they come fix it, and they can deal with the manufacturer of the products they carry...if they want to.
Just too many places are pushing the premise of "we are just the middleman, we didn't make the faucet, not our problem".
I just don't like that thinking.