Protocol & Performance

Day 8

Pay-Outs & Purchases (Part 1)


Hi and welcome to our new Day 8 - Pay-outs & Purchases - Part 1.  The reason this is so phrased is that there’s often quite a bit of ambiguity when you ask someone for a bid and he says “Two-Point-Five-Million-Dollars.”

Okay. So he says that it’ll cost you $2,500,000.00 for his company to do your project. Let’s not even consider at this point what that may entail. At least, at this juncture, it really doesn’t matter what it’s for, what’s most paramount is that this is what you’re being charged and this is what you’re expected to pay. Period. But this gives rise to a most outstanding question: “Why that much?”

Then here comes the other big inquiries: “How much will go towards ‘time & labor’ and how much will go towards ‘what’s needed” (accessories, equipment, electronics, incidentals, etc.)?

For sure, anyone can flash a quote or estimate of any denomination, but is it really accurate with respect to the costs/expenses for both “time & labor” and “what’s needed?” Is that really what it’s going to take to get this project staged, prepped, underway, developed, and completed? All in all, it may require only a cool million for the same expected results.


Separating the Costs of Labor from What’s Needed

What we want is clarity. You see, a bid is more than just a “bid.” Invariably, a bid is how much you’re being charged for what’s often erroneously abbreviated as “Labor & Materials.” For sure, that’s an over-simplification of what’s prematurely being billed to your account. It has NEVER been all about the “Labor & Materials.” Granting, of course, the legitimacy of the “Labor” factor, “all else,” however, entail more than “Materials.” So we’ve got to really pick this thing apart to consider every cost and expense you’d be held accountable for. Certainly, “what’s needed” is comprised of more than “Materials.”

The 12 Basic Constituents to Home Projects (All Else/What's Needed)

Aside from the "Time & Labor"  factor (Payouts), there's the "All Else/What's Needed"  factor (Purchases which cumulatively constitute a separate category for expenditures to incur). This separate factor or category constitutes "The 12 Basic Constituents"  (any or all items which, potentially, you'll be billed for, as well ... ... as aside from "materials").  These are respectively:

  1. Accessories
  2. Appliances
  3. Electronics
  4. Equipment
  5. Incidentals
  6. Legal Fees
  7. Materials (Oooh!)
  8. Miscellaneous
  9. Rentals
  10. Services
  11. Supplies
  12. Tools

So really, “Materials” constitute only 1/12 of the “what’s needed/what else can be needed"  category (any combination of which are always part of purchases you'll be responsible for  in the process of fulfilling your home project).  This being the case, then although someone may be well-meaning saying it, they’re really not telling the truth or being realistically specific with respect to what you’re actually expected to PURCHASEIn light of this actuality, what you may want to do is step back and take another look at the situation. Stop! Look! Listen!

STOP long enough to notice that you’re not ready to pay a dime on anything you can’t clearly see. The reason is that what you can’t see clearly is something you can’t clearly manage since you can only manage what you can clearly see (poetic license).

LOOK with the eyes of an eagle and see that there‘s need to modify the vernacular of what’s being said to something which is more relative to reality and plainly understood.

LISTEN. You can then start with defining costs/expenses for “Time & Labor” as “PAYOUTS” and those for “What’s Needed” as “PURCHASES.”


*Research Links:

  1.    Bonus Excerpt “Power in the House ! - M.S.E.” (Chapter 3)
  2.      General Home Projects Requisition (form)

Please Note That "Research Links" May Become Inactive, Especially Those Which Are Outside HGRBS (Course Sponsor) Jurisdiction. In The Event This Occurs, Please Notify Us Immediately Using The Contact Form Provided In  Protocol Assistance.

End of lesson for Day 8 – Payouts & Purchases  Part 1

Tomorrow: Day 9 – Payouts & Purchases – Part 2


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Whom can flash a quote or estimate on your home project?

Are all initial quotes or estimates accurate?

Since there's more than "materials" entailed for all else which can be acquired/purchased for your home project, how many other potential items (aside from time&labor) can your home project include?

What percentage of "all else" entailed/purchased in home projects is "materials?"


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