We’re seeing a few signals across a variety of sources that suggest demand is easing slightly in the trade space.
House Prices
House prices and values nationwide reflect an easing through 2018. House prices relate to homeowners confidence that improvements they make to their home are going to add value. In a market with uncertainty around future house prices, homeowners generally approach improvements more conservatively.
https://www.rbnz.govt.nz/statistics/key-graphs/key-graph-house-price-values
New Zealand Business Confidence
Business confidence is a useful indicator of demand in the trades space, as this index reflects the optimism that business owners have that things are going to get better, or worse in the year ahead. As it stands, 50.3 percent of respondents expect general business conditions to deteriorate in the coming year.
https://tradingeconomics.com/new-zealand/business-confidence
Builderscrack “Jobs Unchased” Rate
Over the 10 years of Builderscrack’s operation, this metric has been a dependable indicator of the balance between demand (homeowners) and supply (tradespeople), not just in our system – but nationally. Generally this index ranges from 8 to 13% of jobs being unchased. Over the last year we’ve seen this index fall to around 8.3% – indicating that there is an easing of demand in the trades space. Tradespeople are looking to builderscrack for work in higher volumes.
Pricing Variability
Over the last 6 months, we’ve seen an increasing number of support tickets from homeowners confused or concerned with the price range in the quotes they’ve received. This feedback from our perspective, serves as an indicator of the varying methods, margins and cost of materials used in the quote.
Race to The Bottom
Homeowners like assurance, security, and consistency. While there are many homeowners that gravitate to the lowest price, in our experience, if the price difference between the lowest quote and highest quote is too high, homeowners lose faith in both quotes and generally reject both.
This is not good for any party.
A race to the bottom occurs as businesses, and sole traders operating in the trades space begin to sense demand easing. In an effort to solicit more work more competitively, margins or profit on the job are cut in an attempt to come in with the lowest price. By reducing margins, profits are reduced, risk is increased and in some cases, quality and deadlines can suffer.
Builderscrack wants to take this opportunity to remind business owners that not all homeowners are cost driven.
While difficult to quantify, we estimate that over half of all jobs coming into our system are from homeowners who value finish quality, working to deadlines, presentability, professionalism and other qualities over bottom line cost. Of the more cost sensitive homeowners, timely responses, professionalism, and building trust can win work – over simply coming through with the lowest quote.
We also want to remind business owners that homeowners using builderscrack have heightened levels of trust for our platform and in turn, the businesses that quote on their job through our platform. Trust is the key aspect to both builderscrack’s and your success.
In the worst cases, we are seeing homeowners walking away from our platform, and you, our tradespeople – simply because the difference in pricing is too high from the cheapest to the most expensive, in turn eroding trust.
We’re Working Hard to Find More Work For You
We work across a variety of fronts to find work for you. We invest nearly 100% of our revenue in further developing our platform and advertising across multiple channels. From online marketing to offline, appearances on The Block, newspapers and magazines and much more, we are working hard to find you work through this period of easing demand generally.
8 Comments
Shayne
Giday Alana, i am a tradie looking from the outside with a view of stepping in with Builders Crack. Its one thing to do your job and I know its nice to simply get on with it and do it. What is accepted as far as the use of ‘clients’ or people present using phones or cameras. I am by nature a little shy but i can and do engage professionally. Is this the environment that is a norm for us now.
cheers,
Shayne
Alana
Hi Shayne, I’ll send you an email shortly so we can discuss further.
Cheers
Thar
Good morning Thar here from Twins Quality Painters How do we find more jobs we are hard worker doing quality control paint
Many thanks
Twins Quality Painters
Thar
alana
Hi Thar, one of our team will be in touch shortly to help you with this. It looks like your account is not verified, which needs to be done before you can chase jobs. Cheers
Stuart
Can I make a suggestion regarding quoting.
I am finding that a lot of prospective clients that once a job has been quoted,you do not hear back.I understand that in order to get work one has to invest time into the quoting process.It does annoy me as not only do you have to spend time visiting the job site,meet client discuss their requirements,point out any pitfalls & invest time to price out materials & your time.
Why can’t Builders Crack build in a rating system into a clients profile like you do with us tradies?
I am sure it could help cut the chaff from the wheat.
Thanks
Stuart
alana
Hi Stuart, that’s an age-old problem for tradies both on and off the builderscrack platform, isn’t it? We do a have a feature where tradies can leave an opinion/review about a homeowner. This is not publicly visible but can be seen by other tradies when they chase a job lead. Hope this helps. But I will funnel back your idea, we are always adjusting the platform to make it better and most of this is based on feedback, so thanks for taking the time to share this. Cheers
Leon
Hi
By reading your newsletter in regards to quoting. It is really hard sometimes to know what other builders include in their quote and what their margins are. I dont the there is a set standard or rate to calculate a more acurate price therefore resulting in big quote differences.
Maybe this is something for you to work on and send it throgh to us as an example.
Thanks
Leon
alana
Hi Leon, thanks for sharing your idea. This is a tough one because not only do the margins vary between quotes but also what is included or not included. I will pass your suggestion onto the development team and see what/if anything can be done our end. Also we are planning on sharing more articles on this topic, along with information on how to win more jobs with builderscrack in our next few newsletters, they should be helpful. Cheers