Any homeowner that has looked into hiring a contractor to do any work at their house will probably tell you various experiences of sticker-shock at the cost. That may or may not include poor craftsmanship, horrible service and an all around bad experience. The waterproofing industry in particular is well-known for surprisingly high prices and sometimes sub-par customer experience.
This article, one of a three part series, gives you the inside scoop about what you’re actually getting when you sign up with most waterproofing companies.
Selling items for higher than the purchase price is a standard practice in any business. But after more than four decades of collective experience, some waterproofing experts that want to help educate the market came together and decided to share the inside scoop on exactly how much this plays into the price you end up paying.
A common component in any waterproofing solution is a sump pump. An electromechanical device that helps discharge the water from a catch basin to a place safely outside your home.A lot of times, the pumps you would purchase from the waterproofing company is of a considerably higher quality than what you would buy at Home Depot. That being said, some companies were found to purchase similar quality sump pumps as you would at any home improvement store, but mark them up by as much as 400%, claiming they were of higher quality.
In other words, you’re paying $800 for the same sump pump you could get at Lowes for $200.
While you will rarely get a company to disclose their pricing for materials, it’s a good idea to ask for details on the products they use, especially higher priced items like sump pumps. Do a little research on the reliability of the product, check out consumer reviews, then verify that the product they said they were using is actually what they use.
Commissioned sales reps is another common practice for businesses, especially in construction. What is less common in a lot of industries but pretty standard in the waterproofingind stry is 100% commissioned sales reps.
On average, waterproofing sales people get between 10-15% of each sale they make. So if you’re sold a $10,000 waterproofing system, the sales person gets $1,000-$1,500 of that.
Whose pocket do you think that’s coming out of?
Probably not the business owner’s. That also leads into aggressive sales tactics. Some companies will decrease or even eliminate the sales rep’s commission entirely if they don’t close within 1-2 attempts. Be sure to ask the company you’re considering hiring if their salespeople are 100% commission based, then take whatever number they give you into consideration when negotiating.
Speaking of high commissions, sales reps have the reputation they do for a reason. That’s not to say that all sales reps are snakes and are out to get one over on you. But every Sales 101 curriculum includes a lesson about padding any price given.
That gives them room to negotiate down and still make their quota. That’s the secret behind their ability to save you 10%, but only if you sign with them that day. It’s a tactic that scares you into making a bad deal. Meanwhile, several companies have been found to pad their estimates by 30%. That’s on top of the markups of products being sold. That means that $200 sump pump is actually being pitched to you for $1,040. But you can have it for $800 only if you sign today.
So before you sign anything to have a basement waterproofing company do work to your home, remember these three tips to make sure you get the best deal possible:
1. Ask for key product information, such as sump pumps. Product brochures or pamphlets
would be ideal.
2. Find out if you’re actually paying a sales rep to come in and bully you into making a rash
3. Try to negotiate 20-30% off the initial estimate they give you.