Cost-plus pricing

Ep.156: Making Money in Cost Plus Remodeling with David Crane

While Cost Plus Remodeling isn’t for everyone, it can be an enjoyable and profitable way of doing business.  If it is done well, it can be very rewarding and reduce the uncertainty of a market.

Guest David Crane joins this episode to share why cost plus remodeling has proven to be successful for his business and his clients, and why remodelers should adapt this form of a remodeling contract.

David is the CEO and President of Crane Builders in Nashville, Tennessee and has spent the past 34 years meeting clients’ needs with the highest standards in the remodeling and construction industry.  He graduated from Louisiana State University with a degree in Construction and after spending 10 years in his hometown of New Orleans remodeling homes, he moved his business to Nashville where the company has been delighting clients since.  David will also be speaking at this year’s Remodelers Summit in Phoenix, Arizona.

Victoria, Mark and David talk more about:

  • Some of the keys to successfully doing Cost Plus Remodeling
  • The differences in Cost Plus Remodeling vs. Fixed Price Remodeling
  • How to make a profit when you have to show the client your markup
  • What to do with your labor and Project Manager costs on a Cost Plus Project
  • And more…

No Better Way to Build Your Team...

For years we have seen the most successful remodelers in the industry take the opportunity to build their teams by bringing Key Managers and Staff to the Annual Remodelers Summit.

This year, we take that to a new level by offering three content tracks; Business, Value Builder and Production, led by our own “Guru” Tim Faller. So there is literally something for every member of your team, whether they want to switch back and forth or focus on one area.

In addition, with the activities surrounding this year’s Summit, like 2 golf outings and the proximity to the Phoenix area, there are countless team-building opportunities can be combined with your Summit experience.

Register for Summit today and BRING YOUR TEAM!

Ep.31: How to Successfully Use Cost-Plus Pricing with Josh Baker

The Cost-Plus Pricing model seems to go completely against common sense, but it’s a concept that we’re getting more questions about from our membership. One contributing factor is that consumers increasingly demand transparency when purchasing products and services — and homeowners are coming to expect it when undertaking a remodeling project. But so many remodelers don’t understand it. Can Cost Plus be your new pricing model?

Josh Baker, co-founder of BOWA Builders, has been using Cost-Plus Pricing for more than 20 years. In this episode, he talks to Victoria and Mark about its pros and cons, and why it’s a cornerstone of his company’s success.

Josh founded BOWA Builders in McLean, VA, with college friend Larry Weinberg in 1988, serving the Washington, DC, metro market. As the leader of BOWA’s sales and marketing team, Josh helped to quickly grow the company’s revenues from $250,000 to nearly $40 million in just 20 years. As chief revenue officer, Josh’s focus is on growth and managing an energetic, productive sales team. Recognized nationally as an expert in the industry, Josh is quoted regularly in publications, including The Washington Post, Better Homes & Gardens, and Remodeling, and is a frequent speaker at local and national industry meetings.

Cost-Plus Pricing can be a differentiator, but it can also frighten some remodeling business owners — as well as some clients. Josh explains how to present the concept to clients, and what it will take to implement it profitably, as well as:

  • What jobs are suited to the Cost-Plus Model
  • Weighing the risks and rewards
  • The necessity of pinpoint accuracy in estimating
  • Why not to apologize for your costs
  • The time it takes to do well
  • Why you need a sophisticated, expert sales staff to make it work
  • And a whole lot more…

Josh stresses that Cost-Plus Pricing isn’t for everyone, or for every job. Listening to this episode may help you decide if it’s the pricing model for you, or for some of your projects. Check out BOWA’s website for more about the company, and if you have questions about Cost-Plus Pricing, send Josh an email at josh@bowa.com.

 

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