Price < Value

val·ue
/ˈvalyo͞o/
noun
1. regard that something is held to deserve; the importance, worth, or usefulness of something.
"your support is of great value"
2. a person's principles or standards of behavior; one's judgment of what is important in life.
"they internalize their parents' rules and values"

verb
1. estimate the monetary worth of (something).
"his estate was valued at $45,000"
2. consider (someone or something) to be important or beneficial; have a high opinion of.
"she had come to value her privacy and independence"

price
/prīs/
noun

1. the amount of money expected, required, or given in payment for something.
   "land could be sold for a high price"

2. an unwelcome experience, event, or action involved as a condition of achieving a desired end.
   "the price of their success was an entire day spent in discussion"

   verb
   1. decide the amount required as payment for (something offered for sale).
   "the watches in this range are priced at $14.50"

In 20 years one of most difficult things to do in the commercial flooring industry has been to get customers to distinguish the difference between price and value.

The distinction between price and value can be seen as price is arbitrary, while value is fundamental.

Price is the cost a customer pays to obtain your product and services.

Value refers to the perception of benefits received for what someone pays. In many cases, not only will the customer look at the price of the product/installation, they have to weigh factors such as removing the old product or having to close down operations while installation takes place.

Buckled Carpet Tile in a hallway due to a couple reasons.

1. Scraping of existing adhesive was not done prior to new adhesive going down

2. New adhesive was not troweled on properly

In such a saturated market, how can you get people to understand that not everyone offers the same Value when it comes to flooring installation? Do they view every flooring company as being the same?

In the commercial bid world I think it comes as a surprise to many Site superintendents the people who actually show up on their job. Bid houses are constantly working on volume, pricing the installations as low as possible and then going down the list of trade contractors finding the person/company who will do it for the pricing they have. Sometimes giving it to non qualified installers because there’s no way they would give up any of the profit they have built in. Who suffers in this situation? THE FINAL CUSTOMER. The one who is paying to get their flooring done/replaced. Sometimes the final installation looks good, but what about what’s UNDERNEATH?

When existing adhesive it not removed, the new adhesive only touches the new product where the highest ridges are. The result is a floor that is not to manufacturer specifications and the warranty is void.

Many times looking at a project you can’t tell that steps were skipped and the install isn’t up to industry standards. By hiring the lowest bidder, you sometimes lose value in what matters most to some customers, the warranty. I was out at a job recently where there was no moisture testing done. They had drain tile put in and everyone thought that was a solution to the moisture issues that were going on. The reading came back at 100% RH and the LVP was curling up on the edges. It’s skipping steps like these, that end up costing the end consumer (not necessarily in price, but definitely time) in the long run. The VALUE of a moisture test before the start of a job would have had a mitigation system in place and an install that would have lasted. Now, after many attempts to “fix” the issue, the flooring is going to have to have an entire replacement AND have a mitigation system put in place before that happens.

As a consumer you have to weigh the benefits brought by the sales and installation team against the cost of the finished product. Can you afford to close again if the installation fails? Can you afford to have half the life of the product because steps were skipped during the installation?

The higher price up front with the peace of mind knowing you’ll have residual value over the life of the product in my opinion is well worth it in my opinion. But your own opinion may differ. Some people think that the best value is something they can get for the cheapest price, and that’s why the market is the way it is and that’s why our industry has notorious low ballers who hire anyone who claims they know what they’re doing.

At Preferred Flooring MI LLC we pride ourselves in technical service and installation to the specifications of the manufacturer. The end consumer shouldn’t have to deal with the countless failures of some of the installation teams who cut corners and the stores that throw these low numbers out should think of them instead of the profitability of using these unqualified installation teams.

Feel free to comment below.

For direct questions or comments email daniel@preferredflooringmi.com

We NEED Change!

I’ve been in the industry for 20 years and I tell young kids DO NOT GET INTO THIS INDUSTRY . . . Why? Because the flooring installation industry is lacking. We are a hardworking group that doesn’t get compensated for all the abuse we put ourselves through. Flooring is TOUGH on your body, to the point a lot of other tradesman have told me that they couldn’t imagine having to do this full time. Not only is it super hard on the body, where are the compensation and benefits like other trades? Flooring doesn’t require schooling or certifications so that means we’re not worth as much? Give me a break. The people who actually take their time to educate themselves are constantly underbid by someone who is looking to cut a corner to make a quick buck.

We. Need. Change!

I was once told that I wasn’t liked by one of the flooring stores because I am “Trying to change the industry” and they thought it was an insult. This is one of the best compliments I’ve ever had, and I hope one day our name sticks out as one of the few who actually help the industry. What kind of change is needed? LOTS. Let’s just start out with the basics.

Most of the flooring contractors around the area subcontract their labor out. By doing so they avoid the costly expenses of having employees. Does it work? The short answer, not all the time. The government has processes in place that need to be followed and I see far too many “independent contractors” working for just one contractor. The problem here is that they SHOULD be considered an employee.

The second step in this is that the “independent contractor” then hires his own guys and pays them on a 1099 as a, you guessed it, another 1099 “independent contractor” doing work for just that one person.

This is where people get all butthurt when I call them out and say “it’s legal, it’s how we’ve always done it”

We have to pull it together and realize that it’s not how it should be. I started as a 1099 “employee” when I was 12 years old. The problem with this is that most people DO think that it’s ok. It’s time to educate these people. This is one of the biggest problems that I see and it’s because this leads people to not pay their fair share of taxes. When they don’t pay their taxes they don’t have to “worry” about raising their prices because well, they’re not paying their taxes.

There’s far too many flooring business owners who are GREAT at flooring installation, but lack the business knowledge to run it. This is one of the main reasons we lack the benefits other trades have. When you can’t even classify employees right, how is it possible to establish a benefits package? How can we as an industry compete and get new young talent, when a factory can start someone out at $14-$16 an hour and have a benefits package of paid vacation, retirement, health, dental and life insurance right from the start? We. NEED. Change!

Look. We are ALL in this together, and without us all doing SOMETHING we aren’t going to be able to attract the talent to lead the flooring installation industry in the future. Just. Do. SOMETHING.

Start out small. Do you have guys who should be employees but you pay them on a 1099? Switch them over to a w2. Why? It’s the right thing to do.

Do you already pay your employees on a w2? Look into what benefits you can offer to them, maybe start with a paid vacation?

We all need to come together and push for the future, because times are changing and it’s time for us to adapt. Raise your prices, pay your taxes, and pay your guys the way they should be paid. Let’s start making a change!

Feel free to comment below.

For direct questions or comments email daniel@preferredflooringmi.com