reporting module for semi-custom homebuilder pricing support with builder margins - D-Tools Forum

hrenow · 06-12-2008, 07:05 PM

We perform a lot of work for semi-custom homebuilders who make margin on all selections the homebuyer makes. In our arrangements, we generate proposals for each of those homebuyers that are priced in "homebuilder dollars", ie., inflated to include their margins. The pricing levels A thru C aren't adequate to support this process because 1) different homebuilders have different margin/markup factors, 2) some homebuilders apply different margin/markup factors between prewire and components, 3) some SKUs/products are "exception" priced outside of the base margin/markup factors, 4) some builders include certain items as "standard" so they should have $0 pricing. Further, we then must generate an invoice on "actual billing rates", eliminating the built-in margins and charging for $0 standard items to the customer.

Has anyone determined how to overcome this using D-Tools or programs outside of D-Tools? If not, are others interested in a similar solution? I think this is a fairly common practice for anyone who works with semi-custom builders.

Looking forward to any feedback. Thanks! Mike

dtechy1 · 06-13-2008, 05:25 AM

I deal with a contractor that adds 15% on top of my quotes. I would love to be able to add his markup to our proposals so he can present a nice looking quote instead of his chicken scratch.

I am with you Mike.

**Kevin Mikelonis** · 06-13-2008, 02:22 PM

We covered some methods for this in a previous post.

There are so many scenarios possible and each builder may looking for something so different that the only way to realistically discount or reabte or comp a builder without jacking up your database all the time requires a change in thinking on how this is done.

Set a policy on how you perform the calculations and present the information to builders and adjust the amount through some of the methods described in the thread linked below.

http://d-tools.us/showthread.php?t=1...ilder+discount

dtechy1 · 06-13-2008, 03:07 PM

Thanks for the link Kevin.

hrenow · 06-13-2008, 07:43 PM

hi guys,

Thanks you both for your feedback. I read your link to a prior post Kevin and that all makes sense except that we aren't giving a rebate or kickback to the builder out of our normal pricing. Instead, we charge the builder our normal pricing (let's say $100 for a widget) but in our proposals we "charge" the homebuyer $133 for the widget. Once the homebuyer signs off on the proposal their new home agreement is increased by $133. When we invoice the builder, the invoice is $100. The builder made $33 because of our efforts but not out of our pockets.

The problem is that we cannot "standardize" our builders in terms of their margin/markup requirements because of their own corporate policies or prior trade histories. As a result, as detailed in my first post, I still don't see a way to support this kind of arrangement thru D-Tools.

Thanks again guys and have a great weekend.

**Kevin Mikelonis** · 06-13-2008, 07:54 PM

Originally Posted by hrenow

hi guys,

Thanks you both for your feedback. I read your link to a prior post Kevin and that all makes sense except that we aren't giving a rebate or kickback to the builder out of our normal pricing. Instead, we charge the builder our normal pricing (let's say $100 for a widget) but in our proposals we "charge" the homebuyer $133 for the widget. Once the homebuyer signs off on the proposal their new home agreement is increased by $133. When we invoice the builder, the invoice is $100. The builder made $33 because of our efforts but not out of our pockets.

The problem is that we cannot "standardize" our builders in terms of their margin/markup requirements because of their own corporate policies or prior trade histories. As a result, as detailed in my first post, I still don't see a way to support this kind of arrangement thru D-Tools.

Thanks again guys and have a great weekend.

You can still use this methodology by doing a price increase in the project in the D-Tools options section, do an equipment adjustment to increase the price on all items.

Then you can do the rebate.

Otherwise, manage this in you accounting system.

D-Tools is not an accounting system and I have not heard any plans for it to becomne one.

hrenow · 06-18-2008, 07:56 PM

Thanks Kevin. I still view this more as simply a presentation issue rather than an accounting issue since our billing rates never change, its just what the homebuyer sees as a cost for product rather than what we get compensated from the builder to provide that product.