Dear Mr. Blau,
I am writing to you in hope that maybe my screams into the night may be heard. People say that a letter should be direct and to the point but I won’t be able to do that. You have probably heard this story a thousand times, but if you could hear it one more time and possibly end with some of your famous advice it would be greatly appreciated.
First, I have become an admirer of yours through your articles in PM. I have been receiving the magazine for about two years, and have kept every one. Every one of your articles rings the bell of truth, but so many plumbers are deaf and cannot hear it.
My history has been repeated many times over throughout the plumbing trade. I started out as an apprentice plumber in a non-union shop earning money to go to college. The period was during the boom of the Washington Public Power Supply (WPPS) construction of its four nuclear reactors in Washington, and work was everywhere. As a young 17–year–old my thoughts were on making some money and going to college, but my grades were never exceptional.
Our shop was approached by a union representative and a vote was held. I heard about all the benefits that a union has and voted “Yes.”
However, it was the only vote in favor of the union. I should have followed the union reps out the door, crawled in the back seat and requested a ride to the union hall.
But since the job was only going to last me until college, I didn’t jump at the voices that said to do it. I have always recognized the importance of unions and the positive influences they have for worker safety and health. Several years later, I had actively tried to convert an open shop to union, but to no avail.
I was still employed with the same company three years later, when the construction crash hit. The WPPS went down the drain (no pun intended), and every plumbing company’s doors — union and nonunion — closed.
I found myself out of work, and figured it was time to get an education. I took a couple of night classes and worked part-time for a service plumbing company for about two years to keep active to obtain my journeyman’s license.
After I earned my journeyman’s license work was still depressingly slow, so I moved to Idaho to continue my education in the field of quality control at a local Vo-Tech. After one year of school I went to work for about three years as an inspector during the rework phase on a nuclear reactor in Idaho. At the end of the project I again returned to the construction field as a journeyman plumber. I worked for a small company at first, as I was out of circulation for awhile.
After one year at $10 per hour, I requested a pay raise of $.25 and was told there was no extra money. I quit and moved to a larger town. I got a job with a mechanical company for about $12 in 1987. They had benefits and better wages then most local companies. I did it all, hydronics, plumbing, pipefitting on large schools and industrial projects.
It took about two years to remember all that I had tried to escape — low pay, no representation and minimal benefits. The company did have a couple of prevailing wage jobs that helped put food on the table, but in all it was the same old story.
This company had tried to do more for me than any of the companies before, but they still didn’t meet the needs of the workers. This large mechanical company at one time was a union shop, but due to poor management had broken apart and re-emerged as a non-union operation years later.
I am proud of the fact that we have always been a one-income home. It was clear from the very beginning that my wife would tend the children, and I would bring home the bacon. We are blessed by what we have because we have earned it at no sacrifice to our children’s well-being. To help supplement our income I would work on the side, but as you know, that had little benefit and just fewer hours at home.
I applied as a maintenance pipefitter at the reactors located on the Department of Energy complex where I had been employed three years earlier. I took the pipefitter’s test and passed. With past security clearance as leverage, I went to work in 1990 as a first class pipefitter at the Idaho National Engineering Laboratory. I became a member of the Oil-Chemical-Atomic Workers Union.
The wages are better, we have benefits, representation and a steady income to count on. I am putting money into a matched investment program, and building a retirement. We began living the American dream. Though things are still tight financially, it is not the frantic survival I once knew. Now I see a future for us and my children. My job is not as challenging as it was, but we all make sacrifices for our families in one way or another.
Recently, the DOE has been scaling down. Seeing the trend, I began continuing my education again through night school, and have taken my contractor’s license. I even picked up a few odd jobs to re-sharpen my forgotten trade skills. I am trying to keep myself marketable, although no layoffs are expected at my level of seniority (famous last words).
About two years ago I picked up my first copy of PM, and have read them from cover to cover, concentrating on the business columns. I have tried to spread the word about PM, and all should read it.
Lately I have been bidding on jobs in the residential field and small commercial jobs. I used realistic numbers for a proper profit as shown in past articles, and have lost about every bid.
With my current job I do not need the work, but I would like it to buy some toys for me and my wife (camper, snow machine, etc.). I managed to leverage my contractor’s license with a co-worker who has been able to obtain time and material jobs. This has helped my wife and me financially, plus exposes me and my co-worker to a changing market.
I have now had the time to sit down and, as you say, “crunch numbers.” I have figured these jobs down to the minute and now know what it costs to break even and to make a profit. It is now so clear to look back at past side jobs and see why I wasn’t making any money, and why I had nothing in my savings. I read your article that had been reprinted on, “What a new contractor should charge,” and you are right. Anything less is a loss.
I am in a situation that allows me to charge more then the average contractor, as I am not diving for every dollar. I sit back and if I don’t get it, well, no loss. I have recently obtained liability insurance to comply with local ordinances to work within the city limits, and have picked up a house that should give me some spending capital for better equipment as I try to build my tools and stock.
To go out and fully charge that amount would be impossible at this time; however, I can see how it will be done in this area, if not by me then someone else.
Case in point: I did a service call following your advice and others — exceptional service, clean dress, shoe covers on the feet and made the service as professional as can be. I charged $25 per hour over the going rate and the homeowner was glad to pay it, saying she would recommend my services to others! This was a cold call and I had never met her before. It made my day.
Now to the meat of this letter. Last week, I attended a meeting set up by the state plumbing board to go over the recent code changes and the intended enforcement of the 1997 code book in July.
At the end of the meeting the local supply house was going to give a half-hour presentation regarding Profit and Loss Statements for plumbing contractors. There were about 65 plumbers during the second half of the meeting.
The manager of this large supply house introduced himself and gave us his background.
He said reason for the presentation was the continual failure of local plumbing businesses, and losses at his supply house. You know, the paycheck to paycheck, steal from Peter to pay Paul philosophy. He began to state exactly what you stated about knowing your operating costs.
He broke the list down, wages, insurance, auto maintenance, workers comp, etc. He suggested in a polite manner that it is probably best for those who can’t learn this method to work for someone else or just get out! He continued with his large sheet of business expenses listed out for the class to see, and said they were arbitrary numbers and you would have to figure it out for your own company.
His final price for an hourly charge was about $43 an hour. He asked if there were any questions. I raised my hand and holding onto your “What a new contractor should charge” article, hit him between the eyes with everything he had forgotten — wages for the wife, vacation, retirement, PROFIT! and other numbers usually left off. I gave him the real bottom line number of $80 an hour!
There was silence in the room, a lot of disbelief, and then I asked those in the classroom what a copier repair technician charges? Turned out to be $80 an hour. (I had talked to one just that day, and he quoted that price!) I brought to their attention that they must believe their services are less important then copiers!
I then stated that I know for a fact that I could take a chalk line and snap it down the middle of the room and half of the plumbers in this room are charging less then half what the copier tech charges. I expressed that $80 an hour is possible but you have to change your business philosophies.
Just then a Roto-Rooter owner raised his hand and stated, “Making $80 an hour is easy. Nights and weekends I set my price, but come Monday morning I am back to $30 dollars an hour once you plumbers open your doors!”
With no further questions the speaker asked that if he were to set up further meetings and lessons would anyone be interested. Most of the crowd expressed a desire to continue at a later date.
I was hoping for a different ending, maybe someone coming up to me and asking where I got that information, or do I think it’s possible — but no one did. I was approached by the local union rep who liked what I had to say. He said that was the first time in a long time anyone had said anything about benefits, retirement, decent wages, etc.
I said, “It has taken me 20 years to learn to say those words,” and Mr. Blau, they were placed in my mouth by your article. The union rep would like me to get him past copies of your articles to read. I also talked briefly to the manager of the supply house about possibly leaving copies of your articles on the front counters as a community service type of thing from the supply house. What benefits the trade also will benefit him.
Yesterday I received a phone call by the union rep who was there at that meeting. We talked briefly, and basically I stated I don’t have much to offer as it is just me and a friend trying to keep alive our love of the plumbing trade. He hit me from the side and said, “What about service and remodel work?” He stated their union is looking into normally unchallenged areas dominated by the non-union shops.
I said, I know of a very strong union service firm back east whose president writes articles in PM, and concentrates mainly on service and remodels, so it is possible. He said he has some ideas about assisting through supplemental (targeting) wages.
I was ready to dismiss this avenue as limited financially, but earlier today I was introduced through an acquaintance to a young mother and wife at her small apartment. Her husband’s socks hung above the heater to dry along with his children’s clothes. Her husband was out looking for a temporary job.
He is a first-year apprentice pipefitter at the local UA and is on the list and waiting for work. They just returned from Montana from a job that had recently ended. Food appears to be scarce, and furnishings are very limited. She says they are fine and needed no help. Her husband is trying to find work on a temporary basis from a heating contractor, so as not to violate union by-laws while he waits for his name to be called from the pipefitters list.
I have lived through what they are living through. I have struggled, begged for raises and quit in desperation. We all must pay our dues to a point, but it appears the dues are staggering when there is no work.
I remember your article about why you are a union contractor, about retiring with dignity. But I also saw a room full of non-believers who will only change their management practices if it only benefits themselves.
Mr. Blau, you are leading your company into the year 2000, and looking further down the road than most other contractors. You have a mastery in the business world and operation of a plumbing business. Is it possible to duplicate, construct or make possible that which you had started years before?
I know you conduct seminars, and I don’t want to play them down. I am sure they are beneficial to a non-union shop that raises its rates from $30 to $50 an hour, but what about the physical start up of a union operation that would go into competition in an area that is used to Uncle Ted doing it for $18 an hour? My home town, Idaho Falls, contains about 35,000 people, and an hour away is Pocatello with about 40,000 in population. The competition in plumbing, like most places, is fierce.
I am now safe and secure within my job and not interested in losing my asterisks on a wild venture. I am enjoying the time with my family, taking night classes, helping in civic duties and will probably sit back and watch the world go by.
But as I lay in bed this night I couldn’t sleep, so I got up to hastily write you this letter before the seeds of doubt and procrastination settle in. If not for me, maybe the local could use it so more young housewives could use a dryer vs. hanging socks and clothes over heating vents. (Reminds me of my great-grandmother’s photos!) It is now 5 a.m., and I am about done for the night.
This letter does a couple of things. One, it is a chance for me to say thank you for your articles in PM. Second, it is a chance to tell my story, which I am sure you have heard many times, but it is unknowingly being replayed across the country. It is also to say that there is a point that if a plumber is not contributing to the increase of the market, he has to, “Lead, follow or get out of the way.”
Sincerely, Michael Stong.
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