Words That Are Used To Manipulate Us When We Engage In A Home Improvement Purchase

The English language is an iatrical part of shopping and everyday commerce.  Businesses know and understand this well.  In fact there are even books written for words that can sell; to you the customer.  We may not pay attention to these words and you may be tricked by them into making a purchase that isn’t as good as you were led to believe.  So in the war of words here is a quick recruit manual for you consumers when it comes to shopping for home improvements.  Since I am a flooring expert I will correlate many words to the flooring industry but from your own experience I am sure you have seen these words and phrases used elsewhere in other industries.  

The total amount words that are used currently in the market place far surpass what I will cover in this article but the true purpose of the article is to get you to pay attention to the words that are used against you whatever they are.

Words that are used to mislead you

Surplus: Something that remains above what is used or needed.

Overstock:  to stock to excess

Seconds and Surplus: next after the first; being the ordinal number for two.

How many of you have seen signs for flooring companies or the company itself uses the word surplus or overstock in their name to sell their products. There is no such thing as surplus or overstock flooring.  With inventory controls and the high costs of making a mistake in ordering materials who makes a big enough mistake where a store has thousands of square feet of flooring that is surplus? Every builder I know and home owner measure every square foot to the T.  So I know the surplus isn’t coming from them. When the US military says they have 10,000 boots as surplus I believe it.  But not when a flooring store uses it to promote the idea of discounts or cheaper pricing. How can a flooring company that buys containers of flooring direct from China or from their distributor knowing what they are buying and in abundance; label their product a surplus or overstock? Where’s the surplus coming from?

Seconds is a different story: seconds in the flooring industry means there is something wrong with the flooring in so much that the manufacture does not want to put their name on it.  Be it a color variation, twisted or not so straight boards, delamination and finish problems, the formaldehyde emittance is too high for industry standards (the glues to bond most plywood engineered floors emit this in low levels), the color changes color in the sun after time and so on and so on.  If you ask the sales rep why it is seconds the majority of the time they will say it’s a color variation because they really don’t know themselves. I wouldn’t believe it. For the headaches and not really knowing why something is seconds I would run away from seconds unless you’re a flooring expert. You will spend more money using flooring that is seconds than just buying the factory approved stuff.  I have known many contractors who have had to buy 150% or more of material just to finish one area as they threw away most of it since the material didn’t lay straight. 

Factory Direct: Direct: proceeding in a straight line or by the shortest course.

Factory Store: A store that is owned & run by the manufacture.

Distributor: A wholesaler who has exclusive rights to market, within a given territory, the goods of a manufacturer or company.

Dealer: a person who buys and sells articles without altering their condition; trader or merchant

These are used all the time in the flooring industry.  Used and abused.  There are only a small handful of distributors that get their product factory direct compared to the number of stores that say they are selling to you the customer factory direct.  The usual chain of events in a factory direct purchase should be: Manufacturer: Approved Regional Distributor: Flooring Store.  (3) Mark ups.  This is how I have positioned my company; http://texasbestflooringcompany.com/

When this phrase is abused you get: Manufacturer: Approved Regional Distributor: Another Distributor: Flooring Company: Smaller Flooring Store, Dealer, Builders: (5) Mark ups.  Not every company or distributor can get every flooring product, factory direct, if they say then can then I would not believe it.  Manufacturers preselect who they want to distribute their product in a selected region.  That distributor then picks reputable companies in which to sell their represented manufactures goods.  It’s a form of quality control.  So by the time your builder and or installer tells you they can get wood flooring factory direct I would not believe it.

To follow the chain of anything factory direct you go to the manufactures website and look for approved distributors.  Then you call the distributor in your area and ask them what flooring store offers the product you are looking for.  Some distributors are the flooring store thus being a one: two mark up. This is the most cost effective way. Work from the source out not start at the store and work backwards.  So the next time a flooring company or someone else claims to be a distributor, miss leading you the consumer into thinking you’re getting a product direct form the source, verify this, contact the manufacture.

Outlet: a store, merchant, or agency selling the goods of a particular wholesaler or manufacturer.

Whole Sale: the sale of goods in quantity, as to retailers

As far as I know there is no such thing as a flooring outlet store in the true meaning of what an outlet is.  Clothing stores have outlets where the factory makes mistakes and the outlets then offer the products at a discount. For example Polo clothing and Coach Hand Bags have outlet stores that just offer their products. I don’t know of one factory represented, flooring outlet store; anywhere in Texas.  The next time someone claims to be an outlet then ask them why they carry more than one brand and which factory or manufacturer do they represent.  I can say with certainty that if you call a flooring manufacture and ask them where there flooring outlet is in Texas they are going think you are crazy; they may even laugh.  They are going to probably ask you if you mean distributor but an outlet and distributor are two different things. Bottom line is there are no factory direct flooring outlets in Texas.

The phrase Whole Sale is ridiculously over used.  Forget the word all together.  Flooring is sold per job pack, per pallet price, then container price, and then multiple container pricing.  Job Pack is usually under 800-1,000SF, pallets are 1,000- 2,500SF depending on the material ect. Containers are usually 9 or more pallets, and multiple containers reach up into the hundreds of thousands of dollars.  As a consumer the best price you can get, call it wholesale, discount whatever it is, is pallet pricing.  This is your commando word to fight the enemy.  You want pallet pricing on everything you can get since there’s no way your ever going to need a container of flooring with 20,300SF.  This is the term we in the industry use and so should you.  I don’t go to my supplier and say, “Can I get some wholesale tile.” I ask what’s the pallet price and how much do I have to buy to get it for xyz. 

Sale/ Discount Teasers

Save up to ____% Off!, ____% Discount!, Price Break! Price Blowout! Prices Slashed, One Day Sale, One Day Only, Giant Closeout Sale, Everything must go, We Must Move Our Inventory, Buy more save more, Huge Discounts, Buy One Get One Free, Store Wide Clearance, Liquidations:

In sales we call these teasers.  Whenever I see up to 50% off I think 50% off of what; one million dollars? Prices change for suppliers and costs fluctuate in the market. Yes, price increases get pasted on the public but not as extreme as some company’s would make it.  I never really have sales as my flooring company offers just low pricing year round.  Here is the scenario and you tell me where the huge discount comes from.  The flooring manufacture has a price that they set and sell to the distributors.  The distributors then mark it up with little wiggle room to only those who buy bulk.  At this point this is a 2 mark up scenario. If a flooring company is sharp then they find a way to be in this position.  If you as a consumer are dealing with let’s say 3 companies that are in the 3 mark up situation then how can one company offer a huge discount over everyone else when everyone buys form the same distributor in that area? They can offer a huge discount because they normally are way over charging customers to begin with.  This is why they can offer 50% off and still be profitable.  Discount only really truly comes into play in flooring when a product line is discontinued and the manufacture is no longer going to make that product.  Even then you have to ask yourself why would they discontinue a profitable item is there something wrong with it?

Going out of business sale: If a company is truly going out of business wouldn’t you want a warranty on a product that you’re spending thousands of dollars on?  Some would say oh well in flooring you get it from the manufacturer for the product. True, but trust me it helps when the person you buy the product from can help you get your warranty.  A Flooring company that sells thousands and thousands of dollars of a manufactures product can have some pull in helping you, the consumer, get your warranty if you come into problems.

Patriotism: using the word American or USA in the company name:

This is a big red flag!!! Foreigners that come to this country and want to sound American sometimes put the word USA or American in their company name. (Political correctness aside.) The word American is used against us as consumers to invoke patriotism.  The problem is the person who owns the company with this name is usually of foreign birth and does not normally hold the same regard for America and our values that the name is being used to invoke a sale. I did public works construction for 11 years in California and I saw many companies that fit this description and screwed many people over.  The owners of these company’s then go back to their home country wait a few years and come back only to open a new company under a relatives name with all the money they ripped everyone else off before.  Consumers would say, well this is un-American, and I would say ya exactly. Look around you there are 5 to 6 flooring company’s in Dallas that have the name America in it and are owned and run by foreign owners. (Disclaimer: I’m not saying they are good nor bad it up to you to check them out and decide on your own.)  As time goes on more and more people will be moving to Texas as a result of the business opportunities here.  Protect yourself use the better business bureau to check every company out.  Also check with the Secretary of State of Texas to make sure a company’s taxes are current plus you can get the information who the owner and registered agent are in the state for that company.  

 https://ourcpa.cpa.state.tx.us/coa/Index.html

If you’re making a large purchase check to make sure the company is not in bankruptcy. (Store Wide Clearance…. red flag)  Companies don’t have to disclose to you the consumer they are in bankruptcy as it is public information and it is up to you the consumer to do your due diligence.  If you do business with a company in bankruptcy or are buying from a store wide clearance sale get your product on the spot don’t wait for delivery or you may find your check cashed and store locked the next day.  Depending on where you live and the company is head quartered the bankruptcy court may vary.  For Dallas it is:

http://www.txnb.uscourts.gov/Clerks-Office  This is the clerk’s office they can help direct you.

I know this has nothing to do with home improvements but it’s my all time favorite.  Ever see the signs at pawn shops and other places that say, “We buy scrap gold.”  Lol Theirs no such thing as gold that is scrap; gold is gold.  The word scrap is meant to devalue the gold you are trying to sell so you get less than fair market value.  When they melt it down and reform it is it marked, “Previously Gold Scraps”. No its not! Trying going to these places and asking them if you can buy scrap gold one oz bars. Somehow I don’t think they will give you a discount.

The financial and banking industry is one example where you have to have a license or be what you say you are or you risk fines and jail time. The flooring industry in Texas and many other states do not have this federal regulation of checks and balances over the use of words to protect consumers. 

Remember it’s ok to let words peak your interest in a product or service but don’t let it sway you away from the most important aspect at hand.  That being the bottom line; the final price and value of what you need or want. Every industry has its phases and words and they have a purpose.  Just verify the company you are dealing with uses the words to convey their correct position and meaning in the market place.

David Hill

Owner/President

Texas Best Flooring Company, Inc.

How To Get A Proper Flooring Estimate & Discount Without Getting Ripped Off!!!!

 Brought to you by: David Hill http://texasbestflooringcompany.com/

Whenever we do a home improvement we first find a contractor or company whom is going to do the work and ask them to give us a written estimate as to the total cost of the work to be done.  Most contractors will first present the customer with a lump sum price.  Do not accept this and do not ask for a discount on a lump sum price!!! Each estimate is comprised of three or four items; the costs of labor, the cost of materials, taxes, and the costs of the overhead and profit of the contractor.  When you ask for a discount on a lump sum price one cannot be sure where the discount is coming from.  As a home owner you don't want the discount to come from the quality of the materials. Secondly you don't want the contractor to discount the labor by hiring less than perfect craftsmen.  You want the discount to come from the contractor's profit margin. A fair profit for the skill and service of a contractor in Texas is 15-20% on each job or project.  However, I am seeing many companies making a killing off uneducated consumers on an average of 35-60% with not so wonderful craftsmanship or material.  

Your First 5-10% Discount

So the best way to do this is as follows.  One, ask the contractor to break the estimate down into its 3 or 4 parts.  (Labor, materials, Taxes and OP: Overhead and Profit).  Remember some contractors will apply a small profit margin on the material and a larger margin on labor. In a written contract specify that the contractor use only craftsmen that have a minimum of 5 years hands on experience in doing your particular desired task and make sure that if the job is subcontracted out by the company you’re paying that they warranty the work of the subcontractor they are using.  For example Home Depot hires out all of its contracted work yet warranties the work itself.  You don’t want to come into a situation when someone says, “Oh that’s an improper installation issue, I just sell the materials you will have to go find the installers yourself.”

Get a labor square foot, per unit installation, price if applicable. Locking this in prevents the contractor from charging more later on in a project should you decide you want to do more work.  Then ask the contractor to break down the exact materials to be used by name, brand, and specifications for the job and offer to go to the supplier and pay for the materials yourself.  All contractors mark up materials. If you pay for the materials and pay the supplier to deliver the materials; you avoid the mark up and you make sure you are getting the right quality materials for the job. (Nothing gets switched out in route to your house).  Plus, you maintain control of your money and this avoids the ½ down up front never see you again situation.  

It also helps you from being over charged. For example: The contractor says you need 1,000 square feet of wood flooring and you buy 1,000 square feet from the supplier. You have it delivered and you know how many boxes equal 1,000 SF since you have the invoice. When the job is finished and you have too many left over boxes then you were mislead as to the square footage of the project.  If you have the labor rate separated in your contract at a per square foot price then you can say, “Hey I have 200 square feet left over of material and you charged me $2.50 a square foot for labor to install it I am subtracting 200 x $2.50 = $500.00 off the final balance of the job.  I always write on my contracts exactly how many boxes are going to come to the house.  Watch the installers toward the end of the job they will start moving extra material to their trucks to avoid you from seeing this overcharge as well since they get a paid cut for this extra ghost square footage as well.  Remember all material is yours if it comes to your home!!! Count all the boxes. If the contractor gives you any problems about not paying once he or she is caught, then just remember this phrase, “Theft of Services”.  If you pay a contractor for work that they do not perform then you can file a complaint with the local district attorney’s office for theft of services.  Don’t be afraid to use this term if the contractor tries to collect on work they didn’t do or add square footage that never existed.

Note: The best way to find a supplier is to contact a products manufacture.  They will then give you a list of certified distributors/ suppliers of their product.  All contracts then go to these distributors to get the material they use in your home.  Some suppliers will not accept payment from the public but many will.  It’s worth a try or at least a phone call to see how much they charge. It is safe to say the contractor will always mark materials up 10-30%.  So if you have to use a contractor to procure the materials no matter what get 5% discount here.

Your Next 5-10% Discount

Now that you have specified and control the materials to be used for the job the next discount will come from the labor line item.  Most labor is marked up 15-25% in Texas. Wow, I know right? Ask for a 20% discount on this line items total.  Settle for 5-10%.  Never settle for no discount as the meat of all profit for the contractor or sales rep commission is hidden here.   

Your Next 5% Discount

Part three of the estimate should be a tax line item.  Taxes should only be calculated on the material costs only.  The reason contractors give you a lump sum bid is so they can tax the whole project.  It is illegal in Texas to tax a home owner for labor.  There is no sales taxes on labor!!!! Contractors and retailers don’t pay taxes on labor in a contract to the state or government and neither should you. By making the contractor or salesman separate taxes you will get a discount.  Salesmen and contractors tax the whole project and keep the added tax they charge you on labor as straight profit.  Or they give you a discount of say 5% to get you to sign the contract.  What they don’t tell you is they over charged you tax in the first place.  So you will get an average of 5% discount in taxes if you make the contractor break out the bid and only tax the materials per law.  Empire flooring company will not break out their bid since this exposes this trick they use in over charging their customers. Also note: when you pay for the materials you know what the taxes are and you control this number. If you buy the materials taxes are no longer a factor for the contractor to charge you.   

Overhead should be 5-10% of the overall total labor price. Not the materials!!! as you went through the trouble of handling the payment and delivery of the materials this is no longer a factor for the contractors profit or overhead factors.  Anything higher than 5-10% is a red flag the company is not efficient and you should avoid that company. I don’t even have an O&P line item in my estimates as I bury my O&P in the labor line item. My over head is only 6%. Companies that say they need anything above 10% for overhead will not be in business long which means how are you going to get a warranty a year from now? Tell this to the salesman and see what excuses they make up not to mention the look on their face when they don’t have an answer; as they just got caught over charging you. 

Breaking Out The Bid In Its Basic Elements: (I Will Write A Blog On the Elements of a Great Contract At A Later Date.)

Labor/ Installation: $2.50 a Square Foot x 1,000 SF = $ 2,500.00

Materials: 1,000 SF x 5% waste add 50 SF =1,050 x $2.99 A SF= $3,139.50

Tax: Materials: $3,139.50 x .0825%= $259.00

O&P: Usually buried partly in the materials and mainly in the Labor section already so be wary of this line item.

Total Cost of Project: $5,898.50 

If the contractor does not want to give you a breakdown as described above walk away!!!! When contractors file their taxes the state and federal government asks for this breakdown and they can't say no so why shouldn't you get this same information it is your home and you're the boss since you are paying.

Second if you get a break down of the actual square footage of a room, as in a flooring bid, the labor price should be x times the exact room square footage amount.  Most salesmen in a lump sum bid will add a 5-to 10% waste factor to a bid and thus mark up the labor as well.  There is no waste factor in labor for a room size.  A room size is what it is. It is a fixed number.  The only waste factor is in the materials that are used not labor and if your room is a perfect square the waste factor for the materials should only be room size, times 5%, times the price per square foot of the material. 

When you as a customer don't get a bid that is broken out then you set yourself up for overpaying for a job from the start.  When you ask for a discount from a bid that's a lump sum price beware the discount may be tax that you shouldn't have paid anyways, a discount from added labor that was above and beyond the actual square footage anyways, or even if you get a discount you may then have the quality of the material or craftsman's switched out on you.  This is your project take time to control the different aspects of it.  This will also help to avoid cost over runs and weed out any contractors that are rip offs as unprofessional contractors want to only deal with people they can get easy money from. Professional contractors are used to abiding by these terms and conditions and will not shy away from your requests for a break down as they have nothing to hide and plan on staying in business.

Written By,

David Hill Always available to answer questions: 818 274 4029

President/ Owner: Texas Best Flooring Company, Inc.

Builder of Los Angeles Unified Schools and Public Works for 10 years in Southern California.

(One Of The Toughest and Most Regulated Building Environments In The World.)   

http://texasbestflooringcompany.com/

How To Buy Granite Counter Tops & Save 43% Every TIme

http://texasbestflooringcompany.com/

How To Buy: Go to Daltile or IMC.  This is where most if not all local flooring showrooms get their granite to broker a deal.  Do not go to a flooring company to buy a granite counter top! Pick the slab you want.  Try to by the slab directly from these places if they let you to avoid the fabricators mark up on material.  Granite is bought in slabs based on the square footage of the counter top one needs.  Measure your counter top from end to end in inches. Multiply the length in inches times the width to get square inches.  Then divide by 144 to get a square footage measurement.  Make sure you get the backsplash as well it you want a granite back splash.  Most slabs in the slab yard are 45-60SF with a thickness ranging from 3 to 2cm’s and if you have a countertop that cuts into another slab you may find yourself paying for two slabs with a lot of waste.  So try and shop for a slab that fits within your square footage or minimizes waste don’t just shop based on color if money is a deciding factor. 

Once you pick out a slap ask the rep at IMC or Daltile for a recommended granite fabricator.  Business cards and folders of work completed are usually on their counters. Take 3 or 4 cards.  This is the direct way to buy a granite counter top and save thousands.

Locations: Daltile Dallas

http://www.daltilestone.com/series.cfm?c=1&s=108

Daltile Natural Stone Showroom & Slab Yard
2250 LBJ Freeway
Suite 300
Dallas, TX 75229  Phone: 972.620.8427  Fax: 972.620.8281

or

Daltile #214 Fort Worth Stone Center
6323 Airport Freeway, Suite B & C
Haltom City, TX 76117  Phone: 682-647-1100  Fax: 682-647-1112

IMC

http://www.imcstone.com/granite

Dallas

11210 Zodiac Lane Dallas Tx 75229   972-488-5700

Or

2100 Handley Ederville Rd.

Fort Worth, TX 76118   817 589 6032

If you don’t go direct and broker the deal through a flooring Company this is what extras you will be paying.

Costs:

My Fabricator Charges Me The Following Only!!! For a 3cm Thick Level One Granite Coutnertop.

1. I let him buy the granite and he marks it up once. Level one granite costs $9 to 15.00SF from IMC and Daltile.

2. Edging Bullnose full or half demi, flat on face, plus 2 other cuts Free

3. Cut out/Polish and Kit for Under Mount Sink: $150.00 a cut out.

4.  Stainless Steel Sink: $100.00

5. Template Fee To Make Sure The Granite is Cut Correctly: $75.00

6. Tear Out Demo and Disposal Of Old Counter Top: $100.00

7. Granite Level One Installed $32.00 SF Includes Tax On the material. Labor breaks out to $15 to $22 SF Installation.

8. $120.00 Trip charge if client is over 100 miles away.

This is it no other charges for a turnkey installation and guess what not tax as the whole project is a labor item.

What Flooring Companies Charge To Broker The Deal:

1. The granite is now market up a second time usually $5-$10 a SF

2. Edging Bluenose full or half demi, flat on face, plus 2 other cuts marked up $2.00 a Linear Foot

3. Cut out/Polish and Kit for Under Mount Sink: $150.00 marked up $100.00

4.  Stainless Steel Sink: $100.00 marked up to $299.00.

5. Template Fee To Make Sure The Granite is Cut Correctly: $75.00 marked up an additional $75.00

6. Tear Out Demo and Disposal Of Old Counter Top: $100.00 marked up another $100.00

7. Granite Level One $32.00 SF marked up to $35-$45.00SF

8. $120.00 Trip charge if client is over 100 miles away. Marked up to $250.00

9.  Then the worst thing of all is some companies try to tax the whole amount at this point adding an additional $300 to $400.  Granite is a labor item tax is already paid by the fabricator when he bought it at $9-15SF.  The only item that should be taxed is the sink but why would you pay $300 for a sink a fabricator sells for $100?

The average mark up for most flooring companies on granite counter tops is $1,200.00 to $2,400.00 just to broker the deal so don’t get fooled by the signs you see for granite countertops starting at $25 a SF since it never works out that way after all the markups. Using the example above a kitchen with a 70SF counter top and one stainless steel sink included, a person would pay $2,665.00 turnkey if they went directly to a fabricator. They would pay $3,830.00 or more if they brokered the deal through a flooring company or a company that had to pay a fabricator to install your counter top. A 43% Mark up!!!

Remember: Don’t ever go to a flooring store or showroom to buy granite! Go to look at the colors but that’s it. Most if not all flooring showrooms contract out this work since the machines used to cut and move granite around are expensive.  Why, would someone go to a flooring store when they can go directly to a fabricator and save this cost?  Not to mention the warranty comes from the fabricator as most flooring stores don’t give a warranty on natural stone such as this.  Don’t pay this added middle man mark up you gain nothing from this brokered deal except the loss of your hard earned dollars. 

David Hill

President Owner

Texas Best Flooring Company, Inc

http://texasbestflooringcompany.com/