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Why You Shouldn’t Offer Free Quotes….Unless

I didn’t even want the job, yet there I was again, driving my truck down the highway on a hot summer day, on my way to give a free quote for a gutter repair.

I was new in the business and didn’t know any better.  I thought all handymen gave free quotes.

So, there I was, taking precious time out of my day for a job I didn’t even want.

After my long drive, I got out my 65 lb. ladder, dragged it and positioned it beneath the gutters, climbed it, and immediately noticed that I needed a special bracket to repair them.  I didn’t know where to get the brackets.

So, I turned down the job.

An hour and a half of my time gone with nothing to show for it.

During the drive back I was annoyed and frustrated about wasting so much time and gas.  Even if I would have been able to do the job, it wouldn’t have been worth the extra trip for a quote.

Since then, I’ve stopped giving free quotes because they simply aren’t worth it.  Here’s why.

The Allure of Free Quotes

Offering free quotes will get you more customers, no doubt about it.

When you show up to a customer’s house and meet them in person, the relationship instantly changes.  You go from unknown handyman business to a real person in the customers eyes.

The potential customers gets to see your face, talk to you, and will naturally be more comfortable with you than with a handymen he or she hasn’t met.

This face-time with your customers will build trust and help you close more deals.  Period.

However…

Free Quotes Just Don’t Make Cents

As a former engineer, I’m a numbers guy.  So, naturally I just geeked out and broke it down by the numbers.  Let’s take a look:

In 2013 I painstakingly tracked my billable hours for the entire year so I could calculate my average hourly rate.  As the saying goes “what gets measured gets improved.”

By doing this, I was able to look at some eye opening metrics.

Here are some numbers from 2013:

Average Job Size:  $270
Average billable hours/job:  3.3 hrs
Average cost of materials/job:  $44
Average Billable Hourly Rate:  $68

Looking at those numbers, you can see that my average job size is pretty small at only $270 and taking me only 3.3 hrs.

Now, let’s take a look at what is required to provide a free quote.

On average, I estimate it takes the following:

  • 1 hr of time  (30 minutes driving to and from + 10 min looking at the job + 10 min formulating the bid + 10 min presenting it to the customer)
  • $10 in vehicle expenses.

Based on my current average billable rate, that means the cost of giving a free quote is $78!  ($68/hr X 1 Hr plus $10 to drive)  In order to make up for that cost I’d need to tack an additional $78 on to the $270 average job price.   I’d need to increase my prices by almost 30%!

That means a job that would normally cost $270 would cost the customer $348 for the same amount of value.  

I doubt my customers would like that too much.  In fact, they may even look elsewhere for a handyman.

The Truth About Free Quotes

You may be thinking that providing a free quote is another way to be helpful to your customers.  Maybe to provide better customer service or to provide more value to the customer or something.

Here’s the deal, though.

Free quotes are never free.  Let’s just clear that up right now.  Usually, the expense is covered by an increase in hourly rate or hidden somewhere else in the pricing model.

You call it a free quote, but the customer is paying for it in the end.  Or, even worse, you are paying for it.

So, you have to decide if they actually provide more value to the customer.

I’d have to raise my rates by 30% in order to justify giving them.  For my business, that just doesn’t make sense.

Knowing that, I can explain to my customers a very good reason why I don’t offer free quotes.  A reason that has their best interests in mind.  That’s a good reason I’d have to say.

So Free Quotes Suck?  Well, Not Exactly…

The bottom line is that free quotes simply do not make sense for a handyman business focused on small repairs and services.

But, that doesn’t mean they don’t make sense for you.  Maybe you do bigger jobs.  Maybe you only service one neighborhood.  Maybe you’re just getting started and need all the face time you can get with customers.  Or, maybe you don’t do this for the money and just like to meet people.

Those are all good reasons.  Me?  I’ll stick with higher profits, higher efficiency, and more enjoyment in my business.

P.S. I also have a complete pricing guide designed to help you maximize your profits AND keep your customers satisfied.

Click here to learn more so you can stop leaving hard earned money on the table.

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  • Dan farr August 4, 2014

    I agree with you, but most the time the customer is going to want to know what the cost will be to do the work. Do you estimate the number of hours it is going to take you, or do you just give them a flat rate? Also how do you handle the materials for a job? Lets say the customer wants you to replace a kitchen faucet. Do you have them supply it, or do you get the faucet? If you get the faucet, what kind of markup do you put on the faucet? Thank you

    • Dan Perry August 12, 2014

      Dan,

      You’re right, most customers would like to know the cost before you start. But, there are many other ways to overcome this without wasting time. You can estimate over the phone, charge a minimum service charge to come out, have flat rate pricing, or charge hourly.

      As far as the faucet, that depends on the customer. Most of the time I’d prefer if they choose their own faucet because I don’t want to spend time trying to figure out which one the want. If I did pick it up, I’d mark it up 25% at the minimum.

      • Ray Budd February 3, 2016

        Dan,

        I have run into the same connendrum with offering “free” quotes. I now generally play it by ear when possible based on the size of the job, my scedule, etc. However, when I do charge for a quote, I offer that price to be credited off their bill should they hire me for the work.

        Another downfall to free quotes is many customers like to utilize them as leverage from others bidding on the same job. I am careful to leave the details out until the bis is actually accepted. Once tht occurs, I have a write up of what is to be expected for how much. This helps avoid confusion later

        • Dan Perry February 3, 2016

          That’s an interesting idea. How do customers react to charging for the quote?

  • iamdrglass August 4, 2014

    Dan,
    Dan here. how are you presenting this to the customer? I just have always figured the “FREE QUOTES” in to my mark up on materials and labor. I do like the model that the box stores use charge for the bid then take it off the final bill.

    • Dan Perry August 12, 2014

      I try not to tell the customer that I won’t give them a free quote. Instead, I’ll just ask them a bunch of questions on the phone. If I can give them an estimate based on their answers I will. If not, I’ll let them know that they can schedule me for a minimum service charge of $75 and that can be applied toward the total cost of the job if they go with me.

  • Frank August 4, 2014

    Dan,
    I liked this article. Why? Easy. I’ve been there, and too many times. I’m a sucker for the poor old lady client. Ya know what. She really ain’t so poor. These wise old hens can teach you a thing or two. I now ADD 10% to my bid. Ya know what? It usually works, and you get the job, if you’re confident. I’ve seen so many of these big shot, big talkin egomaniacs get work through bluff and bluster, that I lost count. These fools walk all over the quiet journeyman carpenter with a nice truck and all the tools of the trade, who lacks the presence. I’ve changed that for myself, and it’s made a big difference in many ways.

    Also I really liked the engineering quote. “What gets measured gets improved.” I only wish I had been exposed to that guiding thought decades ago. I’d be a millionaire. Maybe I’ll just start now.

    Regards,
    FT

    • Dan Perry August 12, 2014

      Haha, never too late to start! Thanks for the comment.

  • PATRICK FEARICK August 4, 2014

    Did you already start charging for estimates? If so, do the customers seem willing to pay? How much are you charging? Thanks. I appreciate your obsession with breaking down the numbers. (not my strong point). Also what do you think about the method of telling the customer that they have to pay for the estimate but if I receive the job ill take it off the quote”?

    • Rick myslinski August 8, 2014

      I do charge for estimates,the normal charge is 65.00.if it is a large job and requires s lot of my time i would increase it. I tell my customers that is they decide to go with my company i would reimburse them the amount.i have never list a quote because of the charge.

      Rick

    • Dan Perry August 12, 2014

      Patrick,

      I charge my minimum service charge of $75 to quote the job and try to give them an estimate of what it might be over the phone. Once I get to the job I’ll give them a solid quote and if they say yes, I’ll do the work on the spot and apply the $75 to the job. If they say no (which almost never happens), they pay the $75.

  • John C Hanley August 5, 2014

    It should be a case by case basis.
    Their are way to many variables, with type of request, logistics & profit margin being the most important.
    Time is money, proficiency is paramount & customer service rules the day.
    If I have the time and Im in the neighborhood, I’ll offer to do a meet & greet.
    Why not give them an estimate at no or minimal cost.
    Eg: your $10.00 vehicle use calculations
    Any references upon satisfactory resolution of the original request
    more than makes up for the time.
    As far as cost analysis, not the priority unless you are really into breaking down your financials.
    Your target market, competition analysis and on/off-line marketing strategies
    are key to maintaining proficient use of your down time.
    Every region/market is different.
    Know and rank your clients requests so as to be prepared
    for such tasks.
    Overanalyis, not good..
    Having networking associates who are proven performance are great for you and end user alike…good
    My advice is dont take the request if you don’t want/need the job.
    Hagd

  • J Masters August 5, 2014

    Nice article, what does the conversation look like when you give them the bill for the quote? I also give free quotes and have driven as far as 1 1/2 hours one way, plus another 5 hours in bid time to not get a job. I’m concerned about the actual charging and getting paid, for a quote. Any ideas on a script?

    • Dan Perry August 12, 2014

      I’ve also spend a long time bidding jobs to not get them. I’ve done it several times. I believe that is necessary experience when getting started and those mistakes will help give you the experience you need to determine which jobs are worth trying to get and which ones aren’t.

      It sounds to me that if you are driving 1.5 hours to quote a job, you aren’t receiving enough leads. I’d focus on marketing and once you get enough leads you will no longer have to take those jobs that far away. You’ll also have the confidence to test your own scripts as you won’t need every job that comes your way.

      In the case you mentioned above, I’d turn down the job because it was too far away. I’d have to charge way too much for it to make sense for me and I’d rather recommend they go with somebody local.

      If somebody within my service area requested a free quote, I’d just start asking them questions about the job. Then, I’d give them an estimate (usually a price range) right there on the phone if possible. If they still insist on a free in-person quote, I’ll let them know that I’ll need to charge my minimum service charge of $75.

  • James Mason August 9, 2014

    All good point Dan!

  • Graham August 20, 2014

    Hi Dan
    I have bee running my handyman business for 12 years now and this is how I manage this.
    It all depends on the job.
    I charge job specific quite often, x amount to hang a door etc.
    I ask my clients to e mail me a pic or a list from which I can quote.
    For small jobs like hanging paintings or fixing swollen doors I can estimate time and charge that way.
    I also have hourly rates, half day rates and full day rates.
    Thanks for your tips.

  • Wayne Porter January 26, 2015

    There needs to be some flexibility when pricing. I prorate one day jobs with the first hour being $65.00, 2nd hr $55.00, 3rd hr $45.00, 4th hr $35.00. For the rest of the day I charge $25.00 an hr. If someone gives me two or more days worth of work I just charge $25.00 per hour. For some jobs like changing out a water heater can be a set price like $200.00, or easy paint jobs can be $2.00 per square foot up to $3.00 per square ft for more difficult paint jobs, which require multiple colors, and painting of trim, which can take four coats some times.
    If you are just starting out you may need to take what you can get the first year and then get more particular as you build your client base. For most the first year has many tool expenses, as well as vehicle expenses, new trailers, etc. It is a time to build your business physically, but also by increasing your knowledge. The month of January has provided me with time to think through my goals, and educate myself so I can have a better year than the last.
    I also believe that what you charge also depends on the kind of person you want to be as well. I have nothing against making money, but there are many elderly people who have real needs and are truly hurting financially. I encourage every handy man to leave some time in their schedule to give to a cause bigger than themselves. It is truly better to give than to receive. Your work will be more rewarding if you make allowances for this kind of service.
    I know that you cannot stay in business too long if all you do is take charity cases, but if all you think about is money, then you are poor already. Many have climbed the ladder of success only to find that when they have reached the top, it was leaning against the wrong wall. Do not forget that the love of money is the root of all kinds of evil, and many have lost their families, and souls over a love affair with money.

    • Dan Perry January 27, 2015

      I appreciate your thoughts, Wayne. But I disagree. There doesn’t NEED to be more flexibility with pricing and I think you’re prices are on the low side. I’m not sure where you live, but in most areas of the U.S. it would be hard to run a sustainable business with those numbers unless you have another source of income. Have you ever sat down and really looked at your expenses and calculated an average hourly rate you need to charge in order to make a decent profit? I’d be happy to point you in the right direction if you need some assistance.

      I also believe that giving to charity is a great cause and everyone should do it, IF THEY CAN. I applaud you for helping people. In fact, I’ve got a serious soft spot for people who need my help. But, this blog is about running a profitable handyman business that empowers people to do what they love and make a great living while helping people – something that will empower handy people to give more to charity in the future instead of need it themselves.

      I have to say that I am offended by your comment. This is the kind of stuff that plants seeds in peoples minds that making money should be hard or that making money is a bad thing, when that is one of the fundamental mindsets that this blog is intended to help reverse.

      • CC March 12, 2016

        I agree with Dan on his comments in regards to Wayne’s comments. The “love of money” is often misinterpreted. You can be of more service when you are successful. And if you are successful you can help others as you choose, without raking away from your family, or yourself.

    • Roman October 6, 2015

      I happen to agree with Dan. Everyone is in business to make money, whether you work in the W-2 industry, 1099 industry, Entrepreneur industry, or the Investor industry. There is absolutely no such thing as free in this world. I would also have to disagree about the common idea that the love of money is the root of all evil. That is just not true. It’s really the ‘worship’ of money that is the root of all evil. I love money and want millions of it…but I don’t worship it. I have no emotional attachment to it. So if i lose some of it, or even all of it. That doesn’t bother me. As long as I’m breathing, I can always get it back, and at 5x more than before. I just learn from the mistake I made to lose the money in the first place, and get it back the next time on top of what profit I make on the next deal. Too many people in the world are afraid of money for some reason. Which explains why only 2% control it.

  • Ryan September 14, 2015

    Wow, great thread, thx for the great conversation. I am currently in “do or die” mode with my handyman biz. I am way to nice, I undercharge, and I lose money in the end. I love what I do and I’m good at the ‘handyman’ part, but bad at the ‘business’ part. I do way too many things for free. I now have my first child on the way, so I need to ‘nut up’ and start making my business profitable.

    By reading through this post, I feel more empowered to start charging more money. Thanks to all of you for presenting all sides of each argument. When it comes down to it, our handyman businesses are just like any other business. I deserve to make enough money to be able to afford health insurance, contribute to retirement, feed my family and have enough leftover for some reasonable extras like a vacation and Christmas gifts.

    One last thing I want to point out. After being in business for 10 years, I have built a great rapport with many customers. I do a good job, rarely get complaints and work my ass off. Most handymen think that doing a good job (customer service) and charging a fair amount is the key to a successful business. One thing I would like to add is something a customer recently told me… I went to quote a job for this customer, I explained to them that they would get a better deal from an aactual painting crew because of the size of the job and that a large crew would be cheaper than paying my hourly rate. The customer responded by saying “I don’t mind paying you extra, because I trust you to be in my house when we are not here”.

    I just want to mention this because “trust” is something you can’t just search for or find on Craigslist, trust cannot be bought. I literally have keys to half of my clients homes. They know I will not steal or invade their privacy. They don’t have to worry about staying home while I work. As I go through the uncomfortable process of raising my prices and restructuring my business, I must keep in mind that the trust my clients have in me will, to an extent, outweigh the increased costs and other issues that may arise.

    • Tony Richardson December 17, 2015

      Ryan makes an excellent point about trust. A lot of people (especially women) are very wary about letting strangers into the house. So being polite, clean, capable and trustworthy puts you ahead of most of the competition. Most clients are happy to pay a bit more for this. I’ve been slowly raising my rates for 4+ years. I figure if I win 80% of bids I’m doing OK. If I won more, I’d be too cheap and if i won less I be too expensive.

  • Fantastic Handyman January 15, 2016

    Dear Dan,

    Although you do have a serious point there, there are some things I do disagree with. Yes, free quotes for handyman services ARE a waste of time and money, But we live in a world of added value. Maybe from the stand point of a stand alone local handyman, maintenance and repair quotes are indeed an absolute waste, but if you’re dealing with a slightly bigger handymen company you simply “have” to offer the benefit of free quotes. In my humble opinion it is the first step towards trust, which for what my humble experience as a London handyman has to show – is if not THE, but among the most important factors for the average client. Let’s assume that I am in need of an emergency plumber. There is now other way for me to simply leave a plumber in home unless it’s a local handyman, I’m familiar with or if it’s a well established handyman company, which can’t afford bad reputation and usually such companies will never ditch free quotes as part of what they offer. It is simply a bad sign. “No free quotes? Well goodbye, I will hire another great company, that will be more than happy to offer me a free estimation of what repairs or maintenance will cost”. In conclusion – in my humble opinion a local handyman can afford to ditch free estimation bur bigger brands simply can not.

    Kind regards,
    Dmitri

    • Dan Perry January 15, 2016

      Hi Dmitri,

      Thanks for the comment. I definitely appreciate another perspective on the subject.

  • flavio September 30, 2016

    hi good articles. Some time ago a regular customer send me a video of things to be done I was so happy to see that and ask my self why I never thought of. it make sence if you are familiar with the place a simple video is all you need to see the actual job and give a quote sooner than driving to and from.
    so now I’m using this method to all my regular customers since I’m familiar with their place.
    the reality is I’m still struggling with the free quote gost on my neck.
    thanks for the help

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