I would think a sliding scale would work better. Such as the higher the cost for the project the lower the rate should be. Example, who can pay out a 2.5% commission on a $250k project? Especially if you are a General Contractor, for most of the money for the projects are being paid to other sub-trades, for materials and for hourly workers. Anybody in this business knows after you have dealt with under cutting the other bidding contractors and paying all the trades and material bills there is usually not much left over. BuildZoom really needs to think about this one.
i think its fair considering the cost for other leads we pay such as home advisor which charge us $146 dollars per lead and it takes about 10 of their leads to get to one sale or when we pay a salemen 15 percent commision for a sale this is saving us alot in money anywhere from 5 to 15 percent of the cost of a job let alone the cost we save in not having to pay for leads we don’t win i love this system maybe their is something to be said about larger jobs over $100000 but check your figuers on how much itt cost you to get that one job in marking and then compare it to 2.5 percent. i found it to about the same in cost but alot less troublesome then having to deal with all the unquilfied leads i have to pay for the other ways that are out there
Totally fine…
I / We have been contracting for 30+ yrs. When we started we decided that a 25% profit margin is what we needed to be successful and competitive. We see many companies out there “working for wages” and in that case Buildzoom is not for them. But for us? We love it and the fees are nothing. 2.5% for free business is better than great!
I definitely agree with you! These are leads on top of our regular business. if you get slow you can always rely on Buildzoom. It started our business years ago and we have signed some great deals with them.
The fee is great if it is a small project that falls between 1k- 25k but not good after 25k because then the fee is higher like in the thousands and that is not good if the project cost is over 25k. Then the fee should be 1.5% and if it is higher than 100,000 then add another $200 for their allowance. But the fee is awesome because then you don’t have to pay per lead, you just pay a commission. If you make $$$ from the project, in which most Build zoom jobs do end up making $$$, either 25% -45% of the value is profit.
So in my way i rather pay $$ and give commissions than be homeadvisor and running for random leads and customers.
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2.5 percent is less than you are (or would be) paying your marketing and sales staff!
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It is not bad considering how much other ads cost, especially the ones you pay for regardless of any jobs being acquired. It is probably not practical for large jobs, but larger companies usually have a bigger budget for advertising.
I think it’s fine. It’s one more job than you would have had without BuildZoom right?
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Its a good rate
If your company is making money and the leads coming through are good, verified leads, then I would gladly pay BuildZoom and even thank them for running a great company. I don’t know of any other residential construction lead site that can match the quality of leads like BuildZoom but I do see where you are coming from as well. 2.5% on a 250K project is a bit steep. I prefer the pricing they had when they started their Masters program. I believe it was 1% anything above 100K.
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It costs less than paying for advertising and paying for leads that go nowhere. Not a bad deal at all.
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We offer a referral fee for our clients, friends, suppliers and subs.
So a 2.5% referral fee sounds OK to me.
You could not be more right.
2.5% for a confirmed job is a great price, especially when you consider that other sites like Home Advisor, Craft Jack etc. charge you about 2.5% for a lead that has no guarantee of a sale.
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I don’t think so considering how much it costs to run servers, to advertise, to keep everything organized and properly taxed, etc.
Plus they only take out when you win a job; I think it is very reasonable.
Honestly!
2.5% out of $250,000.00 is only $6,250.00
In my opinion that is great if that puts a dent on the project then someone is not budgeting properly.
2.5% out of $1,000,000.00 is $25,000.00
You seriously are telling me that if buildzoom gets you a million dollar contract, a contract that you were only able to aquire through buildzoom, you will have a problem paying $25k on the commision, I’ll probably even tip them.
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Fair price !
I agree that it could be beneficial to have a fee structure that adjusts per renovation size, but also agree that it’s your/ our jobs to properly price and sell a job at a rate that includes our cost, and that also means cost of lead generation.
I also see it a much larger detriment to empower persons to try and sell larger renovation projects who otherwise would not or could not do so, because that is a measure of screening that keeps the home owners safe from a unqualified contractor who is getting in over his head.
I have never had a 100K project that is anything like a 5K or 20K, or even 50k for that matter. If your not able to price in $6,250.00 for a 250k job, than in all truth you shouldn’t be doing that kind of job in the first place. I price in contingency funds of far more than 2.5% for a 250k build, multiples more.
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Sounds fair to us