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When Hiring Subs, You Get What You Pay For

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When Hiring Subs, You Get What You Pay For

Paying the price for cheap subs can add up to more than you anticipate

By By Mike Damora April 7, 2016
Hiring cheap subs often comes with its own set of issues that aren't necessarily good for your business

There was a sub we used at a company where I used to work. Let’s call him Robert. Robert was a carpenter. Not the best, not the worst. He could install kitchens, bathrooms, and decks. He’d do a reasonably good job, when all was said and done.

The problem: Robert liked to have a few drinks after work—and sometimes more than a few. So he shows up when he shows up. If it’s been a hard day and he threw back too many, maybe he doesn’t show up to work the next day at all.

But there were other things amiss about Robert’s working life. You’ve no doubt heard the expression, the customer is always right. But in Robert’s world, Robert is always right. He would get into it with customers, who objected to his never being on time, or his radio playing too loud, or their suspicion that this or that detail—the placement of hardware on cabinet doors, for instance—was off or not what they wanted. To his mind, there is Robert’s way of doing things and that’s the right and only way.

$30,000 Just for Talking

But there was a method to Robert’s madness. He was a subcontractor, so he’d come out to look at a job, give our company a price, and we’d almost always gave him the work. But halfway through, Robert would realize that he’d underbid the job, so he’d want more money. He would always have a reason why he needed more money, and the reason inevitably had to do with something that was the homeowner’s fault. He’d complain that he hadn’t been told about this or couldn’t get access to that, or …

“Hey,” he’d say, “we need to get more money from the homeowner.”

This gets old fast, so on one occasion I confronted him about it.

“Why is it that with you we always have to go back to the homeowner to ask for more money?” I questioned.

“You’re just a salesman,” he said. “You’re not doing the work. You don’t understand.”

Anything beyond the actual field installation—marketing, selling, ordering materials, the fine points of a contract—was, for Robert, a mystery. This whole area was also a source of endless resentment. He once cost out a job for us at $20,000 and we sold the job at $50,000.

“You make $30,000 just for talking?” he said.

I explained that there is overhead, and more—a lot more—that goes into that final contract price and into operating a business profitably. Robert shook his head.

The Customer Is Always Wrong

To Robert, every homeowner is a liar and ignorant and trying to get something for nothing. I mean every homeowner. If it were Mother Theresa who wanted her kitchen remodeled, it wouldn’t have made a difference to him.

In Robert’s view, the problem could never have been that he didn’t actually bid the job right.

So that homeowner with the $40,000 kitchen contract whose kitchen has just been demo’d now has the contractor—us—asking for another $3,000. And then … another $3,000.

The homeowner is a jerk, of course, for questioning Robert’s judgment or expressing the least reluctance to yield to ongoing requests.

One day I was called to a jobsite and arrived to find Robert and a homeowner nose-to-nose in the driveway. It was about to get physical. Robert’s wife had arrived and she was trying to talk him down. It took a few minutes, but I managed to calm the homeowner.

“You have to get this guy off my property,” he said. “Now!”

Once we were out of earshot, Robert started in on how it was the homeowner’s fault and …

“Are you out of your mind?” I said. “I don’t care what he says or does, you never ever take issue with a homeowner like that.”

On another occasion I had to refund a $10,000 deposit on a $50,000 kitchen. First there was the struggle to get Robert to provide the specific plans that the township required to issue the permit. Then, once he got started on the job, it was the usual: he wanted more money. And then more money. I actually lowered the price to try to keep the job. But soon enough the homeowner came into my office and explained what had been going on.  

“I just want out,” he said.

Not So Cheap After All

It went on like that, until one day I asked the company owner, “Why are we using this guy?”

“You don’t understand,” he said. “I get Robert at almost half of what I would normally pay a carpenter. Robert works cheap. He’s the least expensive subcontractor we have.”

“That’s the reason?” I said.

The owner nodded with the sort of smile people use when something’s totally obvious—except to the person they’re speaking with. It made complete sense to the owner, since he viewed everything in terms of the bottom line.

“From what I can see,” I said, “Robert is the most expensive sub we use.”

The smile became a blank look. So I explained. I explained that, as a salesperson, I had to spend more time on any job if Robert was on that job. I explained that homeowners invariably complained about Robert, the person, then about the job Robert did or was doing. Robert may come cheap, I pointed out, but he comes with a slew of problems. Yes, problems are fixable, but the biggest problem was Robert himself, and that couldn’t be fixed.

A few years later, after I’d moved on to another company, I ran into that owner.

“How’s Robert doing?” I asked.

“I’ll never use that guy again,” the owner said. “I wound up throwing him off a job!”

Time to Take Action

If you have a subcontractor or an employee who doesn’t like the fact that your company is making money, who thinks you’re getting rich off everybody else, that’s poison. If you have a sub who is obviously a substance abuser and actively using and who argues with customers, it doesn’t matter how much or how little you pay him or her. That sub may come cheap, but there will be ancillary expenses. You’ll burn through countless potential referrals, waste time, and find yourself frustrated and distracted again and again by the behavior of someone who refuses to consider his or her own behavior a problem.

So what if you have a Robert working for you? It isn’t always easy to fire these people, but it’s far easier to do if you have written standards in place and track and document what that person does. Otherwise, the Roberts of this world will wreak havoc on your company’s reputation. And because you’re likely the last one to know, you’ll be sitting there at your desk, wondering why the phone doesn’t ring.


Paying the price for cheap subs can add up to more than you anticipate

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