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Shopping subs, check numbers, and what's the limit on what's "right" 4

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beej67

beej67

Civil/Environmental
May 13, 2009
1,976
Simple situation, but it seems to crop up in different flavors and forms across engineering business so I want to get some opinions.

Client asks me for a proposal, I need survey, I give her my fee and my favorite surveyor's fee. She says my fee is fine, thinks the survey fee is high, asks me to get a check number from another surveyor. I get a check number from another surveyor, who is not my favorite, but they're still pretty good and could totally do the work. The check number is slightly under my favorite surveyor's number. I give both numbers to the client, she says, "get your favorite surveyor to match the check number and lets get going."

Okay, now that's the sort of thing I would happily do to a car salesman. Is it the sort of thing that's commonly done between engineering professionals? My sense, particularly in these times, is unfortunately 'yes.' Second question, is it looked down upon? If I go to my favorite surveyor and explain that my client asked for a check number, it came in a little lower, and I ask him to match, is he going to be more likely to be thankful I came back to him, or be pissed that I'm asking him to shave his number?



Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East -
 
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1> You seem to be mixing engineering and business. Anyone called "Client" is automatically "business" regardless of what they actually do.

2> That's what's called "negotiation" and is part of business. Seems to me that you got yourself in this situation when you didn't raise an objection at, "match the check number and lets get going."

TTFN

FAQ731-376
Chinese prisoner wins Nobel Peace Prize
 
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I don't believe in this "price matching" bullshit. I don't do it to my subs or vendors and I'm madder than hell when clients try to do it to me.

When I'm procuring anything, everybody gets a first fair shot through an RFQ, and then I choose based on the best combination of cost and features, service or other things I value. No second chances- no bashing a pair of vendors against one another until one drops out.

I don't believe in free engineering and I try to minimize how much of this I give AND how much of it I take from my subs/suppliers. I know that this "free" service is actually paid for by the good clients- it is never truly "free".
 
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I don't consider it professional to barter.

Mike McCann
MMC Engineering
Motto: KISS
Motivation: Don't ask
 
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beej67...put yourself in the position of the "better" surveyor...would you want your fee negotiated to match a potentially inferior competitor?

It's done, but only within a small, reasonable margin among equivalent competition.

Compromise scope, not fee.
 
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I would calmly explain to the client that the price listed for both surveyors is what they believe is an appropriate price for their level of service, you chose that surveyor as your 1st choice due to his quality, and therefore you are not in a position to ask them to change it. If they wish to pay the 2nd-best amount, they can use the 2nd-best surveyor.

Dan - Owner
Footwell%20Animation%20Tiny.gif
 
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2> That's what's called "negotiation" and is part of business. Seems to me that you got yourself in this situation when you didn't raise an objection at, "match the check number and lets get going."
Click to expand...
I have not yet raised that objection, but my window for raising it has not closed. Or, more to the point, my window for recommending that she (we) go ahead and select the check number instead of my first choice hasn't closed. Which I'm fine with.

Not really looking for advice on how to handle the situation. I can handle the situation however it breaks. Looking more for impressions on whether asking sub A to shave based on sub B's check number is seen as dirty or not, to either party. I personally don't like it, but I know other site civils that have been put in that position in recent times by clients shopping civil work, and they've shaved, so I didn't know if it was perceived as poor etiquette or not.

My inclination is to go with the 2nd number and be done with it, but I had an inkling that this would provoke some interesting conversation on eng-tips, and it looks like I was right. I'm anxious to hear if we'll get any other respondents that fall in line with IRStuff's opinions, and I'm equally interested to look at how these sorts of opinions vary by discipline.





Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East -
 
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beej67...put yourself in the position of the "better" surveyor...would you want your fee negotiated to match a potentially inferior competitor?
Click to expand...

Well, that's sorta what I'm getting at. In 2007, if a client tried that at my previous firm, they'da told them to hit the highway and looked for a better client. In 2010+, my previous firm (whom I still do some work for on a contract basis) was shaving all sorts of crap just to get work in the door. Effectively, the answer to your question changes based on how bad you need the work. My preference firm might be angry I didn't ask them to shave and they lost work over it, which is really why I'm asking at all.

It's done, but only within a small, reasonable margin among equivalent competition.
Click to expand...

This situation is most definitely a small, reasonable margin, and definitely among equivalent competition, it's just that my preference for firm came in a shade over. I wouldn't have asked an inferior firm for a check number, because I wouldn't want the good firm to have to match it.

However, I'm increasingly of the opinion that it's an easier decision to just skip the drama entirely and make it a general policy not to ask guys to shave based on check numbers. Less ethical stress for me = win.


Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East -
 
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Shopping subs puts you in the same category as contractors. Either pick one for quality or several for competitive pricing, and stick with it.
 
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This sort of thing happens all the time in automotive and personally I don’t have a problem with it.

I would much sooner someone came back to me and said you have the job if you are prepared to shave say 5% from your quotation, that way I have the choice. I might do that because I need the work, I think the project looks interesting, I like working for that client for whatever reason or looking at it again I think I could lose that much from the quote or I might say fine give it to company B there is not the margin in it for me.

If you own or run a business you have to make business decisions. I would not take it personally if someone asked me to cut my costs and would not expect them to take it personally if I say no. If you are not doing anything underhand I see no problem with it.
 
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We agree that asking a vendor to shave 5% off their price as a condition of award is simply negotiation. They are free to say no, and there should be no hard feelings either way.

Revealing one vendor's bid to another and vice versa is a reverse auction, and I won't participate in them nor will I subject my vendors to that treatment. It happens all the time, but it's still not right in my books unless the vendor's prices are published.
 
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There doesn't need to be any revealing of anything.

You, as the prime, can simply ask for a reduction, without mentioning any other bid, or not; it's your choice. It's also dependent on how you couch the proposition. You can say, "B bid $XX, can you match," or, "B came in lower, what can you do?" Or, just, "the customer wants XX% off, can you accommodate?"

TTFN

FAQ731-376
Chinese prisoner wins Nobel Peace Prize
 
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As we work very closely with our surveyor and they work close with us. I have a we can go cheap to a certain point but will not compete with the lowballers. And I have said that straight out, I will price us down accordingly to see just how low the stragglers will go. And well I guess it seems more funny than anything to me.

We are being referred to on jobs by a company that has been around for 50 years, and we are still cheaper than almost all of the the competition. But there is a certain point where it makes more sense to work at McDonalds.

In case anyone doesn't read in between the lines. We turn around work within less than a week, and I have enough over 1 acre commercial projects to say thats true and gets approved quickly. But no client who is doing only their dream home understands just how many companies lie about their turn around times or what they can offer.

In the end to the OP, I would never throw our surveying company under the bus no matter what. And I am pretty sure they feel the same way. Quality work at closer to on the cheap is extremely hard to find.

B+W Engineering and Design
Los Angeles Civil and Structural Engineering
 
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This crap all started in the US when the Supreme Court required that our code of ethics be modified to take out the prohibition on bidding for engineering services. I hope the moronic engineers who pushed that through eventually had to give away their services. Idiots. That was the most significant step to commoditizing engineering services in the history of our profession and nothing good has come of it.

Here's what the NSPE says about it...

Statement by NSPE Executive Committee

In order to correct misunderstandings which have been indicated in some instances since the issuance of the Supreme Court decision and the entry of the Final Judgment, it is noted that in its decision of April 25, 1978, the Supreme Court of the United States declared: "The Sherman Act does not require competitive bidding."
It is further noted that as made clear in the Supreme Court decision:

Engineers and firms may individually refuse to bid for engineering services.
Clients are not required to seek bids for engineering services.
Federal, state, and local laws governing procedures to procure engineering services are not affected, and remain in full force and effect.
State societies and local chapters are free to actively and aggressively seek legislation for professional selection and negotiation procedures by public agencies.
State registration board rules of professional conduct, including rules prohibiting competitive bidding for engineering services, are not affected and remain in full force and effect. State registration boards with authority to adopt rules of professional conduct may adopt rules governing procedures to obtain engineering services
Click to expand...
 
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I don't see the problem with what your client did. I also don't see the problem with you going to your preferred sub, and telling them the situation. If you have a good relationship with them, this is a non-issue. It's not like you told the client that your preferred sub would match the price--it's something that they requested. You bring it to your sub, and let them do with it what they will.

Tell the preferred sub, "Might have a job for you, but the client requested you come in 5% lower in your bid. Let me know what you'd like to do."

This is business--whether engineering, retail, or otherwise. It's silly to think that negotiations won't happen.

V
 
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I see nothing wrong with it at all. If you have a good relationship with your surveyor give them a call and lay out what is happening. If I were in the surveyor's shoes I would much prefer the chance to say no to just calling you in a month and finding out you gave it to Brand X.

This happened to me just yesterday. I had a design proposal out for a concrete shrine of all things (Buddhist). It was around a $20k design fee. The PM called me and told me that BrandX had come in at about 9% lower than me. I wasn't offended, I was grateful. He just asked me "What do you want to do?". The project seems so interesting that I really want to do it, and so eventually I sent back an amended scope that nearly matched Brand X.

 
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As a civil engineer who has to work with land surveyors, I think that a good relationship between the two professionals is important. Our designs are often closely based on the information obtain from these surveys.

Of course, errors can then be explained by returning the ball from one side or the other... But I rather tell my client to go with Favorite #1 Surveyor or Favorite #2 Surveyor. Then, best price gets the job. If my client wants to deal, he can do it. I won't.

 
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Why are you even telling the client your sub number? You are providing them with a total number and thats all that should matter.

If you must reveal the number, tell the client that you use this surveyor because they are top quality. Since you are providing the complete package you would not want part of package to be crappy.
 
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