How I Got a Plasterer to Drop His Variation Price by 33%
Builder-side confession. A plastering subbie already on site quoted $3,400 for a steel-frame variation. I had other quotes around $2,900 and a worst-case of our own site manager doing it for $2,000. One phone call ("we've got someone who can do it for two grand, can you match it?") and he signed at $2,400. On a $100k variation that same move is $33,000. Here's how the leverage works, what I didn't lie about, and how you hold firm when it's used on you.
Transcript
Here's how I screwed down a plastering subcontractor in Brisbane for, I think it was, say 1.4k. It was either a thousand bucks or 1.4, let's say 1.4k. That's what I believe it was from memory. Story short, builder here in Newstead I was. Plasterer, he was on our fit-out project in our Newstead project. Was already on site. The project was about 80 % left to complete.
And there was like a steel frame something at the entrance of the project this was an office fit out for reference we needed to get done we could have had our site person on our site manager do it knock it up but was busy actually managing the site so that wasn't the best case and then we had the plaster on site that we could have had to do it or we could have hired I guess contracted out to another subbie whoever happened to be that specialized in that metal work that sort of framing that we needed done for the entrance how I screwed down our plastering subbie that was currently on the site to do it for 1.4k less than what he had quoted us on and I am telling you the story because I want you to understand the sort of games that
people can play and the games get a lot darker than the one I'm going to tell you here lot of people lie be dishonest and make things up in order to get the cheapest price of you. Me, it was a matter of negotiating from a very strong position of leverage. That's why it was so easy for me to do it. Did I lie? No, I didn't. So I want to make that clear.
There will be people doing worse stuff that you're up against. This is just the tip of the iceberg story of what I did while maintaining good values but having one core sort of objective of making more money on the project for my builder because I was employed at the time so that was in my best interest. Nowadays you wouldn't catch me screwing down the subbie and you'd catch me being very very clear.
Let's get into the story. The subbie quoted I think it was 3.4k and for easiness of the story let's say I got them down to 2k asked I knew I had those three options as I mentioned earlier asked the plastering savvy you please quote us up to supply and install this work the background I was getting supply quotes from metal fabricators supply and install quotes from other metal fabricators other plasterers whoever I could find on the market that could Give me a quote so I could at least compare his price for this variation against all the others to make sure he wasn't overcharging us and that we were getting essentially the least expensive option possible.
Could have gotten my site manager to do it, but we needed him to do other things. So I kept in the back pocket of my mind, come to worst, if everyone died tomorrow and the site manager was still alive, I could have the site manager do it. For roughly what I worked out to be around two grand, like just his time involved. If we were to purchase the materials directly from Bunnings with the cheapest thing and just for him to install it because he had those skills and he could do that.
So it was about two grand for that bare minimum if we wanted to get it done with our site manager, our own employee to do it if we wanted to. But no, we needed him doing other things. But that was my leverage point because that was my best alternative solution this plasterer or any other keep that in mind because that is how I leverage this subbie make.4k make and drop his price for that he gave us the quote the plastering subbie 3.4k I had other quotes from like metal fabricators for like around the 2.9k mark nothing really below 2.8.
The thing is, as a builder, if you've got a subbie on site, it is so much easier to just give the work to that subbie there. You don't have to worry about anything. You trust them, they're on site. You don't have to worry about extra access, re-signing them up with PO. It's just more risk for the builder, more admin, more time. So that's why subbies, and for your reference, you can charge a lot more for variations because you're already on site.
You have to be reasonable and not go over the moon, but that's why I had to do my due diligence and get the other quotes to make sure that this subbie wasn't overcharging us just because he was already on site because he might know that we want to go with him already or that we're not around his quote came in for 3.4k I had the 2.9k roughly quotes then my site manager for the two grand he could do it for worse comes to worse what I did was I called up our plastering subbie who was currently on site and I said hey mate we please can you meet we've got another subbie who can do this for two grand now that was the half dishonest truth like own manager the one that could do it two grand so it wasn't genuinely subbie but
that's what I said trying to not be dishonest and then I said hey met us at two grand I said to him look because you're already on site I'd love to give it to you but I was wondering if you could bring your price down that's how I leveraged him he said mate couldn't drop it to two grand because then we wouldn't be making the profit out I'm like okay well can you give me your lowest possible price which still gives you a reasonable profit for you to be able to do this work he's like okay no problem 2.4 grand is where I can meet sorry so I got my maths wrong it was a thousand I shaved off his quote but you can very quickly so yeah I locked him in for that 2.4 grand to do that plastering work that variation
you can see very quickly although it sounds like one grand isn't much in this instance one grand of 3.4k about 33 percent of the quote value is actually a huge difference if we're talking a 100 grand variation and these scenarios do occur the bigger they get largest sums on the table that are at stake I could shave 33 percent of a subbies variation quote just like that by butting his head up against other subbies which I may not actually want, but just because I have that card and leverage that I can use against him.
I can shave him off 33 % on a hundred grand variation package, that is 33 grand right there. A very significant difference once the numbers scale up. I really hope this story helps and shines a light on how builders will negotiate against you and how you can hold firm. Suppose as long as you know your numbers at the end the day and what you're willing to do it for, like what's the lowest, and you're able to meet that without sort of sacrificing or wearing or to absorb costs yourself just for the sake of doing it or taking on too much risk, that is ultimately best position to be in because then you know what is worth taking on and what's not.
And you can hold firm and walk away if you have to. Feel free to comment if you want to hear any other stories just like this one. I hope that was of value to you. If you want more value, there's free tools in the description. I don't need to explain it, but Risk Ganner and Judicate Pro are the two main ones right now and a bunch of other free resources for you.
So dive in, enjoy. On a mission to help re-level the subbie versus builder dynamic because I'm sick of seeing subbies get screwed down. So if you like that, follow along. I apologise, my throat is very sore. I've been rambling this whole video. Free to drop me a subscribe and I'll see you in the next one. Cheers.
General information about Australian subcontracts, not legal advice. Get advice on your own contract and facts.