Bryan Caplan  

Contractor Cutoffs

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Be Careful What You Wish For... Some Counterproductive Candor ...
Getting a contractor - plumber, painter, cable guy, whatever - to come to your house tends to be frustrating.  You wait around for hours, he finally shows up, and then... he don't do a very good job.  Or, he finally shows up, and wants $300 for a seemingly simple task.  Nevertheless, turning to the competition is not enticing.  After all, how do you know that the service and/or prices of the next guy won't be even worse?

Yes, if the quality or price are bad enough, you'll react.  But what are your thresholds of badness?  There are several to keep in mind.  Relative to your perceived distribution of quality, how bad does a contractor have to be before you will...

1. Fire him?
2. Never call him again?
3. Not recommend him to others?

Personally, my respective cutoffs are about the 15th percentile for firing, 35th for never calling again, and 50th for not recommending.  But this is just a rule of thumb; I don't have anything better to back it up.  Anyone got a better handle on this?


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COMMENTS (10 to date)
Unit writes:

Find out if the crew consists of Mexicans or other immigrants. They are usually much quicker and much cheaper.

Publius writes:

doesn't

Nathanael Snow writes:

Why don't we call more than one repairman each time something goes wrong?
Why don't we call, say, three?
Whichever one gets there first gets the job.
The other two don't.
We create an incentive for them all to get there faster.
I'm guessing we have developed a social more against this kind of behavior, especially when it involves people coming into our homes. This is probably because we don't want to anger people who also are not necessarily in the same social circles as us (which would provide a bit of protection) and yet know where we live.

How many people would have to adopt the "call three repair guys and only award the job to one" strategy before arrival times became more predictable?
How much of an effect would it create? (elasticity?)
Do we not adopt this strategy because these potential costs are greater than personal gains especially if there are free riders.

Fire him, and call Tyler Watts.

Peter Mazsa writes:

http://www.angieslist.com/Angieslist/
http://www.trustys.com/
http://www.servicemagic.com/
Perhaps http://www.domystuff.com/home

P.

advincili writes:

Хорошая тема, сколько вокруг непознанного!

Mike Rulle writes:

I like the Mexican answer too.

I don't know if you intended to make us laugh, but laugh I did. Not because it does not make sense, but because people reading this site are likely to think in the same way as you. "Normal" people do not have to ask this question. The reason is they already "know" the answer. They also will last longer than "us" when the lights finally go out. They know how the little things in life actually work. "Big brain" people like us are left doing probability analysis. When they get charged $300 dollars for something that costs zero (on the margin) to fix, they laugh and pay $50.

An example from my own life provides insight. I have an overhead projector home theater. It is linked to this network of techno-complexity. Occasionally, the projector would just "go out". I would call the firm to fix it and pay $300. When this happened a second time, I actually asked the service person what the issue was. He guiltily told me the next time it happens "just unplug it then replug it". Like rebooting a computer, except in 2 seconds.

Arnold had something about too smart people the other day. Too smart for common sense.

Doug Tengdin writes:

How about asking for a personal guarantee and then calling them back when the fix doesn't work? This has worked for me for big-ticket items (a deck, a new sink hookup) but not for roto-rooting the drain.

On the other hand, since I live in a rural community, I can usually work along side of the guy doing my deck and I learn enough to do a lot of the little stuff myself.

What's the translation and source of the Russian quote?

Colin Fraizer writes:

Oh, from the title I thought this post would be about your contractor wearing Daisy Duke's shorts. I can see why you might complain about such...unless your contractor looks like Daisy Duke.

Jacob Oost writes:

In which case, Colin, she'd be booked solid from now til' November and single-handedly lift us out of the recession.

BTW, in sticky situations like this, I always take a step back and ask: why is this industry so inflexible, and why does it lack such liquidity of competition? And my pondering usually leads me to the usual suspects, like procedure-based regulation, occupational licensing, artificially high entrance to doing business, etc.

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