Dispute resolution

[Grimsta]

Here's a scenerio, let me run it by you guys and tell me what you think.

So I ran my little garage shop for awhile. My labor rate was $45/hour. I have this friend who's brought me 2 of his friends to get work done also. One was big build, one was just a clutch job. So I tested his car early this year and determined he has bad #3 rings, he needs a rebuild. So he needed sometime to save money. In the meantime I dont have a concrete date from him so I book an MR2 and Pino. The while the MR2 is still here, but AFTER I booked Pino he tells me he's ready for his rebuild. So I book him after Pino. Fast forward a few months and the city comes in and tells me I'm in violation of home occupation and have to move all this stuff out blah blah blah. So I'm complying and I buy a shop. Now I have the overhead of a shop, cant work on people's cars for $45/hour so my new labor rate is $70/hr, however I'm not raising the price on Pino and the Eclipse I have here because their work has already began and you cant change price in the middle of a job. My friend that has been waiting for his rebuild still expects to get his original price of $450 for labor because I was giving him a 4 hour discount and only charging him 10 hours. I tell him I can still give the discount but at $70 since this sh@$storm with the city ruined the home operation. He says thats not fair and I cant change the price on him since I already gave him a quote. I tell him indeed it wouldnt be fair if I just raised the price for no reason, but I wasnt a legal shop before, I am now, and with that larger responsibility comes higher prices, for everyone, not just him. I offered to give him the 14 hour job at $45/hour which is less than the 10hour job at $70/hour but he still says thats not cool. I'm legally responsible to hold to my estimate I cant change the price on him in the middle of his job, but the thing is I HAVENT EVEN STARTED HIS CAR YET! I've told him that several times. I told him IF I was already in the middle of his rebuild with his car taken apart he's right, I couldnt raise the price, and I wouldnt, but I havent started any work on his car yet so unfortunately he misses out on that since I cant work on his car in the garage anymore and he has to come into my legit shop. I'm still giving him a HUGE discount with $25/hr off my labor rate because he is a friend and I want to help him out, good luck getting that anywhere else. But none of us were expecting this, sorry if it upset your plans, but believe me, it REALLY upset my little world even more and its something we all have to deal with. He has the option of accepting it and coming in or go somewhere else. I dont have the option of not dealing with it because if I dont, I get fined $15,000. So really its the city that screwed both of us up and its time to accept that and deal with it.
So what do you guys think? Do you think I'm not doing right here?

 

[Mk3runner]

yup your doing the right thing. I understand the guys point. but you haven't started your job. from what I know your a very fair man with good reason. I would still continue to bring you work even for the upped rate. course I work on my own rides. but if he is still bitching toss him the keys and tell him to find another shop. dont try to work something at this point I can only see it going bad if you continue on this guys ride.

 

[ms07s]

I understand where your coming from here. However, being Mr. nice guy tends to make more problems than it fixes, in my experience. You haven't started on his car, he hasen't paied you, and things have changed that you can't control. The only thing you can do is say this is the new quote, take it or leave it.

 

[Mk3runner]

I understand where your coming from here. However, being Mr. nice guy tends to make more problems than it fixes, in my experience. You haven't started on his car, he hasen't paied you, and things have changed that you can't control. The only thing you can do is say this is the new quote, take it or leave it.

exactly, I doubt this guy can find a better deal. just don't let him slide either he accepts the new quote as said or he can walk.

 

[Facime]

Did you give him a written estimate? If so I would say you should be bound to that. If not then you should give him a new estimate (written) and put a time frame on it (i.e. "good for 30 days"). Legally he doesnt have a leg to stand on so it really comse to down to how bad you want the business, and much trouble the guy could create for you if you send him away pissed off. I take it this is a new venture for you, so building a client base is almost more important than making money off each and every job.

If you can do his work without actually losing money (you should have already figured out what your exact break even point is per hour for the shop taking all expenses into account) I would say do the job making SURE that he realizes you are doing him a huge favor and that you are not obligated to do so. Maybe he will bring you more work that you can charge out at the proper rate.

its always a balancing act when doing business and especially if that business involves "friends". My advice to you right now is if you want to make money doing what you are doing, treat everyone equal, no "friend" discounts.

 

[suprahero]

I guess I'm the minority on this one. If I told a FRIEND of mine I would tear his deck down and replace it for $450.00 labor, and a month later my power bill was a little higher than normal, then I would still charge him $450.00. I don't need a written aggreement between a friend and myself. If I gave him my word on a price then I would stick to it. You're only as good as your word. Hopefully you two can work it out.

 

[Grimsta]

Yeah thats a point he keeps bringing up telling me all the advertising he does and all the work he brings in for me, but he's refered 2 cars in 6 months. 1 was just a clutch job so he's giving himself waaaay to much credit for that. I know what your saying about no "friend" discounts. I dont, I've really only given friend discounts to 3 people. Alex on here being 1 of them and this fellow we're talking about being another. But his build would be a sweet one that would showcase what I do well so maybe I could do it for him for $450 if he would work on it with me.

Suprahero- I get you and I stick with my guns as well. But here's the scenerio its a little more complex than having a higher power bill its more like this. I used to do all this work from my garage, no overhead accept our home rent. So it was no problem doing it for him even if my power bill was higher. But some asshole complained, the city came and is going to fine me $15,000 unless I get all this stuff out. So I found a shop, bought it and am opening June 2nd. So it goes from helping a friend out in a home garage to taking away time from paying customers that can feed and clothe my daughter because he took to long to get his act together

 

[ForcedTorque]

So what happens if you get his car pulled down, and run into more in repairs than first expected? Does he then cry again because you are gonna want him to pay for the additional repairs. If he's not willing to understand the current situation, will he be willing to understand the future situations too, and expect you to still handle the extra burden again??????

 

[suprahero]

I get what you're saying. The only thing you have to ask yourself I guess, is do you have something else to do. I did a vinyl siding job for a guy last week for a price I would never normally do it for. He is a contractor and can get me more work, but I did a job for him for two grand that I normally would make three to do. It took me six days to do it in and I paid out nine hundred and fifty dollars so that leaves me about a grand. If I'd had something else to do then I would have never did it for that amount of money, but one thousand dollars is one thousand dollars. If you can make more money working on someone else's car then that's what I'd do, but if you can do his and make four hundred and fifty, and possibly keep a friend, then that's what I'd do. Maybe work him in when you don't have anything else to do. Good luck either way, and I hope it turns out a win / win for you.

OH, yeah, even a small clutch job is still a referral, and it may turn out to bigger things later. The guy owning the car will also tell his friends about you as well, so don't just blow it off as a clutch job. All referalls are good referalls.

 

[Facime]

I agree with you Jay, but I guess Grim should clarify what kind of friend the guy is. I mean I have "buddies" and I have "friends". For me I usually do "friend" work for cost of materials, but their work is done at a lower priority. "Buddies" get a lesser discount, but generally get faster turn-around.

I also strongly agree with the statement that you are only as good as your word. Thats not just something taught in the south

 

[Grimsta]

Yeah, I got the same buddy and friend system, lol. He would be a friend, lower turn around so it doesnt hurt normal flow. But Suprahero, talking about what you said $1K is $1K, I also been thinking about that. If i'm not crazy slammed with work income is income. I'm working something out with him now. I offered him his original deal if he would work alongside me in the shop on his car a little

 

[Mk3runner]

well if he doesn't go all asshole then do what you gotta do to help a friend out. you know my stories from my former friends speed shop in vacaville. he tried to pull me for money I didn't owe so I had to part ways. not saying this is your case just an example. this hit you at a very odd time but seems to me it will work out for the greater good. maybe a little rocky at first but you should do ok.

 

[Facime]

I'm working something out with him now. I offered him his original deal if he would work alongside me in the shop on his car a little

I think thats a great idea and more than fair. Nothing wrong with a little "sweat equity". I wish more shops offered it. There are times I would pay just to have access to a lift or a little indoor space. My current living situation is part of the reason I dont own a supra right now.

 

[ForcedTorque]

Yeah, I got the same buddy and friend system, lol. He would be a friend, lower turn around so it doesnt hurt normal flow. But Suprahero, talking about what you said $1K is $1K, I also been thinking about that. If i'm not crazy slammed with work income is income. I'm working something out with him now. I offered him his original deal if he would work alongside me in the shop on his car a little

Let him know that you would then be giving him invaluable experience as a bonus. He will not only get hands on experience, but also advise from someone who knows while he does the parts he does. And, the help that you get will not be all that helpful as he is not a trained mechanic.

 

[Grimsta]

He's not a trained mechanic but he did go to the same school for automotive that I did, but didnt continue with automotive since he felt there wasnt any money in it. So he can turn a wrench which is all I need him to do while i'm turning a wrench on somethin else

 

[suprahero]

Sounds like you worked out the win / win that I was hoping you would. You've kept a friend, and he will now be a walking billboard for your company. Word of mouth is one hell of an advertisement. Unfortunately, it seems bad publicity travels faster and reaches more people............:biglaugh:

 

[Grimsta]

Well he's already supposed to be a "walkin billboard" and that hasnt really done jack, but whatever. I will have him sign a contract obliging him to attend at least 4 track events within the year whether it be NASA, AutoX, SCCA, or even drag i guess although I couldnt really care less about that

 

[tlo86]

how did the city find out about your home

 

[Who]

I offered him his original deal if he would work alongside me in the shop on his car a little

Careful now. Your at home shop just became a real business with insurance and liability. If your "friend" gets hurt at your new shop he could turn on you and really cost you allot. Your liability insurance would cover a customers injury but not a customer acting in the role of a mechanic. Sorry to sound like a negative SOB but thats the real deal at least here in the sue me state Palm Beach, FL...
By the way the average labor rate per hour is $92 in my area. Your friend is getting quite a deal.

 

[savannahashlee]

I agree with you Jay, but I guess Grim should clarify what kind of friend the guy is. I mean I have "buddies" and I have "friends". For me I usually do "friend" work for cost of materials, but their work is done at a lower priority. "Buddies" get a lesser discount, but generally get faster turn-around.

I also strongly agree with the statement that you are only as good as your word. Thats not just something taught in the south

Can you be my friend WeezL... I need some advice on my Eclipse.. I think there is something wrong with the clutch or the slave cylinder.. If you're over 21, I've got beer and steaks.. I'm only like 20 miles from ya in Lebanon.. LOL


Grimsta, having him work with you on the car is an awesome idea.. It will also teach him more about his car.. I'd be so down with something like that..