Shopping for your best deal on materials will not be difficult once you know what you need and want. When you have a detailed list of material specifications, you can basically circulate the list among suppliers and wait for the best price. In theory, that’s all there is to it. However, in real life, you will have to exert a little more energy to find the best bargains.
I had an occasion once to shop for materials with four different suppliers for the construction of a new house. I submitted identical plans and specifications to the suppliers and asked for detailed quotes. When all the quotes were in, there was a spread of about $4,000 from the lowest to the highest bid. This was many years ago when prices were much lower. Can you imagine that much difference among four suppliers for the same materials?
When I first saw the discrepancies I looked for errors in the bid sheets. I found none. After looking for mistakes, I began to compare the bids on an item-by-item basis. The picture started to come into focus as I studied the bid sheets. In some cases the materials I requested had been substituted, but for the most part, the difference was simply in the price of the materials. If this can happen to a professional contractor who buys materials on a daily basis, you can imagine how homeowners who may never visit a store again might be treated.
Aggressive shopping can save hundreds, or even thousands, of dollars on a kitchen remodeling job. There comes a point where running from store to store is not cost-effective, but sometimes it pays to deal with more than one supplier. Many people feel that they will get the best deal by purchasing all their materials from the same vendor; and while this should be true, it is not always the case. Let’s look at some methods you can employ to get your best deal on materials.
CIRCULATE YOUR PLANS AND SPECIFICATIONS
The first step in shopping prices is to circulate your plans and specifications. If you have a detailed take-off of the materials you want priced, that is all you need to distribute. Send the bid-request packages to several suppliers. If your job is a big one, it may pay to send bid packages to suppliers in other cities or states. It is amazing how much prices can differ from city to city and state to state.
If you do shop materials with long-distance suppliers, keep shipping costs in mind. They may outweigh any price advantage gained by buying at a distance. You may also want to consider the disadvantages long-distance suppliers offer in terms of product assistance and returns on damaged or improperly shipped items.
It is a good idea to call each supplier you will be sending a bid package to and request the name of an appropriate person to address the package to. Otherwise, your package may get shoved aside and neglected.
Once the bid packages have had time to arrive at the various suppliers, call and talk with your contact person. Confirm the delivery of your package and ask if there are any questions on the items you want priced. Inform the contact person not to make substitutions unless absolutely necessary, and if substitutions must be made, have the estimator note the changes in red ink. Insist that the bid be prepared in phases. For example, you might have the following phases for a kitchen job:
- Framing materials
- Wall coverings
- Plumbing fixtures
- Light fixtures
- And so on
Having your bids broken down into distinct categories will make your overall evaluations easier.
GOING OVER THE QUOTES
Going over the quotes should be done when you have plenty of time and will not be disturbed. If you are in the middle of evaluating the prices and are frequently disturbed by a ringing telephone, you may overlook something of importance. The comparison process will work best if you have a large table to work at. This will allow you to lay all quotes next to each other for a quick, one-on-one comparison.
If all your quotes come back divided into the proper phases, consider yourself lucky. Suppliers don’t like to go to the extra trouble to break down their bids, and they know you are more likely to spot high prices if you can compare prices side by side. Most suppliers prefer to give a lump-sum figure at the end of a computer printout. When your quotes are not broken down properly, you will have to work a little harder to determine the real meat of the bid.
What you need to do is look at the price of a 2-x-4-inch stud from each supplier. Check each supplier’s price per square yard for floor covering. There is little doubt that there will be ups and downs among these items. While it makes no sense to run all over town buying studs from one supplier, nails from another, and plywood from yet another, it does make sense to shop in phases.
Not all suppliers get the same
discounts on all materials. One supplier may have a great price on cabinets and a terrible price on floor coverings. It will be no great inconvenience for you to buy flooring from one store and cabinets from another.
LOOKING AT THE BOTTOM LINE
Looking at the bottom line can be quite deceiving. If you look at four bids, it will be easy to see which vendor is offering the lowest overall price, but this doesn’t mean it is the lowest price possible for the materials you need.
As you just learned, not all suppliers can sell the same products for the same price and make a profit even if they wanted to. There are usually some items that can be bought for less money at competitive suppliers.
By shopping the bids in phases, you will find the best prices available. You might have to deal with six different suppliers to save the most money, but you won’t lose much time in doing so. There is nothing wrong in dealing with multiple suppliers.
What’s included in each of the bids that you are comparing? Have all the suppliers include the sales tax on their bids. Generally, some suppliers will and others won’t, and this can make a sizable difference in the bottom line. If the materials for your kitchen remodel cost $10,000 and the sales tax in your area is 6 percent, the supplier who has included the cost of the tax will appear to be $600 higher than the suppliers who didn’t include the tax. This situation is common and one you should look out for.
Will the suppliers deliver the materials for the prices quoted? This may not be a big deal if you have a truck and are only buying a few items, but if you are ordering for your whole job, delivery can be a problem and an expensive one at that. Most suppliers will deliver free of charge within a certain radius of their warehouse, but this is a question you should find the answer to before making a commitment.
Are the items you want regular in-stock items? If a supplier is quoting a job with materials that are not normally stocked, you may be faced with delays and extra hidden costs. When the supplier doesn’t stock an item, you may have to pay for the shipping charges to have the item delivered to the supplier. It is unlikely that the supplier will reveal this expense in a competitive bid.
NEGOTIATING FROM PRELIMINARY PRICES
Once you have preliminary prices, you can begin the hardball negotiations. Most suppliers give professional contractors at least a 10 percent discount on the prices of materials. This discount is rarely offered to homeowners. However, if the suppliers can sell to contractors for less, they can sell to you for less. But you will have to convince them to do so.
Let’s assume that you have gone over all your bids and one supplier has offered you the best prices on everything except your floor covering and
plumbing fixtures. You could buy from multiple suppliers to get the best price, or you could try negotiating with the one supplier that did well on pricing the other items.
If you want to deal with just one supplier, take your other bids with you and go in for a personal visit with your sales representative. Explain how you would like to buy all of your materials from one store, but you can’t justify the extra expense for the flooring and plumbing fixtures just for the sake of convenience. Ask the sales representative if anything can be done to lower the prices on the two overpriced items.
If the sales rep feels that the entire order is in jeopardy, there is
a good chance that the sales manager will authorize a lower price on the flooring and plumbing fixtures. Remember, they probably have a 10 percent cushion of profit built into the entire order to work with. With a little persuasive negotiating, you can probably walk away with the best price and only have to deal with one vendor.
It may also be possible to negotiate for at least a portion of the discount normally offered to contractors. A lot of contractors finance their purchases for thirty days. Since you will most likely be paying in full upon delivery, use your payment terms as leverage. Impress the sales manager with the fact that there will be no risk in collecting a bad account and that the store is not really losing any money by giving you the same discount offered to professionals.
There are plenty of ways to drive a hard bargain if you are willing to spend the time and effort to do it. Suppliers don’t want to see their competition get your business, and this gives you an edge. You don’t really care where the material comes from, so you can shop until you get the deal you want.
Once you have your materials secured for a good price, you may need to find and contract with some subcontractors to help you get the job done.