Are You Charging Enough for Deck Features?

By Bobby Parks

Today’s Outdoor Living Contractors

In today’s deck building market, radiuses, borders, inlays, outdoor lighting, and mitered stair tread details have become the trend.  I have friends that deliver amazing award-winning creations utilizing some or all these elements and most have figured out not only an efficient way to deliver these options, but also how to price them. I know from price tags I’ve seen on jobs and through conversations as I travel around the country that some could be charging more than they are for their projects and especially upgrade features. These operators are producing impressive work, but at compromised prices. In a best case scenario, this limits their profitability. In a worse case scenario, this weakens their financial health and lessens their chance of riding out the next economic downturn as there’s likely no buildup of reserves!

Reasons for Underpricing 

Many deck builders begin businesses with stronger building skills than sales abilities. While most  develop the balance with both, some don’t and often provide quotes without proper presentation or follow up which can handicap margin. They can sell jobs as long as the price is “low enough” but for varying reasons, they struggle to sell at needed margins. 

Underpricing or selling at minimal margins is often a result of one of the following: Not understanding the real cost of delivery. Not understanding the cost of overhead. Undervaluing ones worth. Underdeveloped people skills and sales ability. 

Generally, it  occurs with newer contractors that are trying to establish themselves, but lack confidence in their ability to sell or in the value of what they offer. It also occurs with many who worked as subcontractors that have not fully understood retail pricing or struggle to mentally overcome the “cost” aspect when quoting a customer. It even happens with veteran operators who undervalue their worth and lack the development of confidence to mentally overcome price. 

Motivation, ambition, and what’s considered as satisfactory profitability varies with contractors. At the end of the day it’s what you are satisfied with that matters. I’ve met with contractors that weren’t charging enough for basic jobs and I’ve met with some who charge appropriately for most jobs but don’t charge enough for added features.  Let’s touch on some of these.

Radiuses Are Premium Features with Premium Price Tags

Radius decks provide a great look and delivering them can separate you from competition as you’re offering options that many don’t. But as good as they look on website galleries and social media, it’s only a good option if they’re profitable deliveries. The process for layout, framing, jigs, material, heating and bending borders, and taping takes extra time and requires an investment in equipment. From a sales and production standpoint you’ll spend more time on the site compared to simpler designs, so the project should be priced to produce comparable margins as other jobs from a production aspect.  Giving a deal on the first couple of jobs to create projects to leverage off of makes sense, but otherwise these works of art are opportunities for added profit. 

Mitered Stair Detail Feature Options

Stairs are a necessity for function and can be a “feature” as well. When I built in Georgia most deck projects averaged being at 10’-12’ elevations with 15 or more treads a common occurrence.  Often a landing to redirect the stairs was needed, so by the time railing and lighting were added in, this was a pricey component costing the customer several thousand dollars before the deck dollars even factored in. This left less in the budget to create the usable space, so I kept it simple with stair systems that included riser boards, stair treads, and continuous pvc side skirt trim but not mitered surrounds. It was a clean and functional finish but not a “feature”. If I were operating today, I’d give the customer a choice for more deck space with “nice stairs”, or less deck space with really nice stairs”.

I discuss stairs here as I do for three reasons. One I know from conversations that some have been charging for custom treads similar to what I was charging for my standard ones five years ago. Secondly if the stringers are not stiffened and the treads not installed correctly, potential issues may show up as stairs are tested every time someone walks them.  The push off when weight is applied traveling upstairs and the downward impact pressures on tread nosings walking down is different than typical deck surface travel and can rock the miters over time. You must think about what these will look like 5-10 years down the road and not just for your one, three, or five 5-year warranty. And third, if flat blocking is used and not taped there’s potential for rot issues as well as framing swell which can open up the joints. So, if you’re installing them, take appropriate measures to ensure they’ll hold up and price accordingly. 

Lighting Features 

 Because code requires stairs to be lit in some fashion, I always had a standard lighting package priced in and offered the customer an option to add more for the deck. I know some contractors that throw in a lighting package as a “special offer” effort to help sell the job. If you have priced the project where you believe you can absorb this without affecting your real desired margins or you’re willing to take a hit on some jobs, then I see the rationale. I realize some basic packages can be done at a low cost, but in my opinion, contractors should see “lighting” as an opportunity to add to profits, and not provide for free. Why give something away that most will pay for and that could potentially create callbacks? 

Price it so the Customer Pays Now and You Don’t Pay Later

I’ve learned from over 30 years as a builder that products don’t always perform as advertised. Wood rots, fasteners corrode, and manufactured products can fail. Years fly by and not everything stands the test of time. Incorporating high building standards with pricing that guard against problems is a good approach. Taping pressure treated lumber in certain applications is a good example. But charge for your work and educate the customer why it’s a good idea to do it. If you’re going to experience rot, it’s likely to show up on cut stair stringers, planed down joists, and flat blocking areas used for inlays and borders, so taping is a wise investment. Even if your structural warranty has expired, your reputation can still be harmed with wood or product failures. And if you didn’t follow exact installation guidelines and set the customer up to be “in compliance” and a failure occurs as a result, regardless of your warranty; you may very well be liable. 

In Summary

So, understand my efforts here are not to offend anyone because of how they operate. I know some markets are more challenging than others and there are always low-ball contractors that factor in. The points I’m trying to make are: Value your gifted abilities and worth and charge accordingly. Have confidence in what you do and require customers to pay for the skill you bring to the table and the art you create when it comes to upgrades or don’t do them. Limit the deals you give and only award that “upgrade discount card” for those rare projects where it will be worth the investment. Leverage off those jobs and off the reputation and brand you build and maintain because you possess the skill for such offerings. Create sales models and track cost of delivery so you’ll be able to accurately charge moving forward.  Give your customers options with an upgraded price tag so they see the difference and value, so you come out ahead either way. Realizing markets vary most can charge their worth. It’s a builder’s market in most regions and if you’re a quality operator, you are in the driver’s seat. And although profit margins vary slightly from job to job when job-costing is done what’s important is that it averages out at the end of the year. 

Selling jobs at the right price will always be challenging and requires several aspects working together.

The key is to separate yourself from others by creating layers of credibility. Gain confidence in who you are and what you offer along with generating the right kind of leads that provide the opportunities needed to hit your numbers. There are ways to position your company to increase success in sales and increased margins and I’ll share my thoughts on that in upcoming pieces. 

Bobby Parks / Instagram: @Bobbyparks007

Copyright February 12th, 2020 – Bobby Parks





If Customers Were Always Right, We Would Go Broke

By: Bobby Parks

 “The customer’s always right”. It’s a common saying that some may believe, but fortunately it’s not true or we would all go broke. We would throw in the towel whenever a customer claimed something was wrong, make fixes that had nothing to do with us for free, or give them at no cost what they mistakenly thought they were supposed to receive. And we would be firing our people once a month because the customer claimed they did something wrong. Imagine the cost drain that would occur. Restaurant and retail store managers may be able to give away meals and smaller items to make a customer happy and go away, but because our servings are more costly, we as contractors can’t afford to do the same. The trick is how you explain to them why they are not right without offending or losing them in the process.

It’s not to say we as contractors don’t make mistakes or create issues for ourselves, we do.  But often when issues arise or potential confrontations exist it’s because of a customer’s mistaken perception involving the scope of work, project options, or installation procedures. In rare cases, it’s a customer trying to get something for free. They see an opening and push the boundary to see if you will cave and donate to their project.

To be more specific, these undesirable communications occur when customers believe they are supposed to be getting something different than what they are getting or they believe something that is not included should be included. Often, it can include an existing condition or repair they believe should be part of the job. For example; they contracted for a deck and they believe the rot discovered after the job started at the attachment and around the fireplace bump out should be included.  Or it can be technical aspects about an installation. They’ve read something or someone told them something that makes them believe you are going about it incorrectly. In any case, how you respond matters.

Communication and Documentation

Most job confusion issues result from a lack of communication, documentation, and improperly set expectations. We all know there are plenty of legitimate issues that pop up; so why allow avoidable or mistakenly perceived problems to enter the mix?  When issues do occur, the objective should be to obtain a quick satisfactory resolution for all parties without relationship damage and keep the project moving forward. And without sacrificing profit!

Minimizing the potential for such adventures to occur should be a standard practice. Setting realistic expectations when contracting is much easier than setting them after the fact or while you are on the job. Writing up a contract agreement with a description of all relevant details as well as general operational clauses as to what a customer should expect and what you are responsible or not responsible for is a simple basic business practice.  Typically, I had 21 standard clauses in my contract before specifics were added. These standard clauses covered everything from delays due to weather, existing rot, unforeseen conditions, lawn damage responsibility, that material left over belonged to me, measurements are approximate, and even “rights to take and use pictures”. The list goes on and there’s a reason for every clause.

There’s A Lot Discussed & Less Included

Although lots of options and details are discussed during the consultation and designing phase, specific details and final elements that are included and agreed on must be documented as later it all runs together for most customers. So, in addition to the standard clauses of a contract, numerous specific details such as rail types, decking choices, and any pertinent choices are documented. For me, a design drawing that also included some details was signed off on.  Honest mistakes in memory occur with both parties, so having details benefits everyone and this alleviates or resolves a high percentage of issues when referred to. It should be comprehensive enough that a third party should be able to review a job file and know what’s being done. I also made it a point to include and attach photo examples of certain items and details to the package like rail types and trim finishes which I could refer to as well. I did this because customers don’t understand our assigned product titles or lingo, so this provided a visual that was an addendum to the contract and often used as examples when requesting HOA approvals.

From a technical and product standpoint most customers do their due diligence online. This should be expected and is good in that they can become somewhat educated regarding their investment. But it’s not good if they get bad information or interpret something that doesn’t apply to what you are doing. Chances are, the better the contractor is from a written detail and communication standpoint, the less likely these issues will come up and the more likely the customer is mistaken if it does. Now, the lesser prepared contractors will likely experience not only more issues, but the ones that come up will be trickier to resolve.

Customer confidence in who they choose as a contractor alleviates some potential issues as they trust you. If something does come up, my experience has been that they are more likely to believe you and assume they are mistaken. This comes from established credibility as a contractor and the relationship you have built with the customer.  This only carries you so far. I have learned that no matter what you do and how much you cover up front, problems can arise. On occasion we or our people do stumble, which compromises us and that is challenging to recover from. Acknowledging the obvious if you are wrong is the best way to begin to recover confidence and get the relationship back on track; but if you’re in the right…then standing your ground in a professional, confident, cordial, and unemotional way is how I’d handle it.

Managing the Conversation

So, for me these conversations always included an acknowledgement that I understand they believe something was included that they are not getting, or our technical approach is not what they expected. Often the first part was resolved by referring to the detailed notes or photos we all signed off on or what was on the drawings.

If a technical issue or question came up, I’d explain why we do what we do, why we can stand behind our building methods and why we might not if we did it another way. I did not let them engineer or dictate how I was going to structure a job or approach it from a technical standpoint as my warranty only applied if it was built to my own and code standards.  This assumes you have solid ground to stand on and you have not compromised yourself from a technical standpoint. Know what is required from both a code and the manufacturers aspect. For example: Customers find lots of information online with common searches involving pressure treated wood use, including, treating end cuts and stringers, or what voids a manufacturer’s warranty etc. Surprisingly, many contractors do not have a proper understanding of what is required with this aspect which can come back on them. To be caught on the wrong side of  obvious technical mistakes are not only embarrassing, but really does compromise you with a customer from a confidence standpoint. You should know that everything is just a “Google” search away for the customer.

There’s a Cost Either Way

Again, you can’t give away things just to make people happy, but for me if there was a gray area with minimal cost items or a slight repair that they thought was included and I believed they genuinely believed it, I looked at it like this. Sometimes there can be a bigger long-term cost if you do collect versus absorbing the hit. So, there can be a cost to you either way even if you collect money from a customer for a disputed item. The key is to determine which is the costliest. For example, you could stand your ground and charge a customer $300-$400 for something they disagreed was owed but would reluctantly agree to pay for. How will that $300-400 compare to the cost of having an unhappy customer you’re creating in the process? How will the rest of the job go now that they have an attitude? What kind of review will you receive? How many referrals will you receive from this customer? In the long run which choice cost you the most?

But let’s say it was a $1000, or some larger dollar value. I might take the pre-mentioned approach, but instead of absorbing the full amount I might offer to discount the work or split the cost with them. I would stress again that it wasn’t part of the job, but I realize they believe it was. Just to show an effort of good faith I would make the offer. But I would not give away the $1000. My experience has been that it’s the things you give away or give a deal on that are often the problem items on a job, so I don’t take these offers lightly. Also, I know that every percentage point matters, and small amounts multiplied add up over time so what you agree to from a dollar figure depends on the size of a job and what the percentages are. For example, you wouldn’t give up $300 on a $3000 job as that would be 10% of the project. But on a $30,000 project it would only be 1% and might be something you could live with.

Reasonable People and Reasonable Solutions

I’m a believer that reasonable people listen to reason and make decisions and reach conclusions based on reason, logic, and the practicalities involved. But I believe unreasonable people or the ones that are working you for something free are not fair minded and will not reach the same decision or conclusions. That’s where firmness, backbone, and written specific details and inclusion as well as exclusion cards must be played. Standing your ground in a professional and unemotional way at this point is just part of being a business owner and required for long term survival. Some customers are more difficult than others and how to deal with difficult and unreasonable customers is an article all to itself.

But my experience has been that if I listened to the customer first and then discussed a situation professionally with a reasonable and genuine effort and attitude to resolve it, my customer relationship was strengthened. For example If I made the decision to go ahead and do a minimal cost item even though technically I could get out of it and charge, but I knew the customer truly believed they were in the right, I’d do it in a way that had value. It might be “Look I’m sorry there has been a misunderstanding and I can understand you think this was included. It honestly is not but I want you to be happy and for this not to be a problem-we are going to handle it”. And I said it in a positive way. I didn’t say it with an attitude or in a reluctant resentful way. If you did the latter, you might as well have charged them as there is no gain.  I believe these customers often look back and remember that you did something that they often come to realize wasn’t part of the scope, but you did it anyway and you were nice about it.

Resolving Issues Properly Can Strengthen the Relationship

Ethical contractors strive to be fair and to satisfy their customers. Most customers are reasonable minded people just wanting us to meet their expectations that hopefully we as contractors have properly set. So, we must be fair to them but also to ourselves and to protect our businesses and livelihood and maintain a balance between the two. When practical and reasonable approaches discussed here are made and agreed upon, result in a cordial resolution; I believe these customers often give you the best reviews compared to the ones that had an uneventful experience. They have a more in-depth belief in you because the fairness and integrity test were passed versus a non-eventful delivery. Therefore, my experience has been that the contractor /customer relationship can become even stronger when an issue arises compared to a project that runs smoothly. I’m not saying you want more eventful jobs, only that if you take all the upfront precautions to cover yourself and it still happens, handle it in a manner that at the end of the day more than overcomes the few dollars you may have given on that job. Consider it an investment on your reputation and brand that creates fans of your company and may produce even stronger referrals compared to your typical jobs. And consider it a lesson learned and in some cases, an added clause to your next contract.

Bobby Parks / Instagram: @Bobbyparks007B