“It's just not right that these guys charge so much and get away with it," Jimmy mused as he waited for the phone to ring. "I know more about plumbing than most of these guys and I sure don't run up huge bills by adding on a bunch of unnecessary repairs." Jimmy wanted to get the word out about these rip-off practices, but how could he do it?
This was going to be a challenge because many of his competitors were excellent contractors - some as good as or better than Jimmy. It would be tough to compete against these contractors based upon quality. After all, plumbing isn't an Olympic foot race where the winners are determined by 100ths of a second. How can a typical homeowner measure nontangible concepts like integrity, skill and workmanship?
"Why not use a tactic from politics?" he mused. Instead of rising above the crowd, he could simply knock the crowd down a notch or two with some negative exposure. The best way to accomplish this feat would be to let an "unbiased" news reporter do the dirty work through a television consumer advocate sting operation.
The goal of the sting was to catch unsuspecting plumbing contractors in the act of overcharging, misdiagnosing, selling unnecessary repairs or other unscrupulous deeds. After locating a willing TV news program - not a difficult task in most markets - he needed to set up a plumbing defect for the bait. This task proved more difficult than he'd expected. Why? His competitors probably wouldn't stub their toes on typical plumbing problems they see every day. This meant he had to create a nonconventional plumbing problem, something not easily diagnosed.
Setting It Up
Bogus fault No. 1 was to use a razor to make an imperceptible slit in a toilet flapper, making it leak just enough to cause an occasional and annoying refilling of the tank. Bogus fault No. 2 was even more ingeniously simple: On a gas-fired water heater, he loosened the thermocouple connection at the gas control, causing the pilot to fail.Both of these "faults" could be easily repaired with minimal expense so, presumably, any contractor who tried to charge more than a pittance was obviously a crook. The TV crews put their hidden cameras in place and the consumer affairs reporter started calling suspect contractors from Jimmy's list.
They hit pay dirt with the very first contractor. When the unsuspecting service plumber examined the toilet, he offered his customer three options. First, and cheapest, was to replace the refill valve and flapper as a package deal. For about twice as much, the second option was to completely remove the tank and replace not only the refill valve and flapper, but the flush valve, trip lever and tank-to-bowl bolt and gasket set as well. If that wasn't enough, the "unscrupulous" service tech offered to replace the entire toilet at a cost of several hundred dollars.
Jimmy looked at the reporter and gave her a "thumbs up" sign. "We've already nailed our first overcharging plumber and he hasn't even looked at the water heater."
When the plumber checked out the water heater, his rip-off mentality was even more blatant. Repairing the thermocouple was simply a matter of tightening the connector nut - no parts necessary at all. This plumber offered two options. One was to replace the thermocouple as part of a package deal that included cleaning the burner, checking the draft on the flue and a couple of other simple procedures. The price of the job was well over $100 but wasn't nearly as exorbitant as the second option he offered.
This plumber had the audacity to offer a whole new water heater even though the existing one was less than eight years old! How could he possibly be so mercenary as to offer a whole new water heater when a slight turn of a wrench would have solved the pilot light problem?
Most of the other "sting" victims offered similar diagnoses and options although one replaced the flapper only. Another service plumber accidentally discovered the loose connection on the thermocouple and took care of it for the price of a service call. All in all, it was a fruitful sting operation. When the show aired on the evening news, Jimmy appeared to be a plumbing expert and true consumer advocate. He even received a few service calls because of his free publicity. Jimmy was a happy guy.
Hidden Consequences
But what was the true cost of all this free publicity? Jimmy's image-building campaign really didn't elevate him and his business. Rather, he simply blackened the eye of his trade by making true professionals appear to be high-priced rip-off artists. You see, Jimmy sufferers from myopia. He can't see beyond the immediate problem, which is why his business can't grow. But worse than that, his myopic perspective also results in damage to his profession. Let's examine what Jimmy missed.A $3 flapper would have taken care of the immediate toilet problem. But let's look at the bigger picture. A true professional recognizes that a customer may endure an irritating problem for days, even months before calling to get it taken care of. When the customer finally does call for service, he has to take time out of a busy day to be there, even for a small problem. The small size of the problem is insignificant to the much larger infringement on the consumer's schedule.
What if the serviceman is willing to replace this almost insignificant part alone? He'll save his customer a few dollars on this trip, but what if it turns out that the simplest solution only results in another call a few days later? To be sure, the plumber would only be liable for the flapper - anything else would be an extra charge. Is it fair to the customer to ask him to take off more time and to pay another trip charge because the plumber "saved" him $50 or so off a service call?
What about the water heater? There's a huge difference between the price of a new water heater and a thermocouple replacement. Is this in the customer's best interest? Why spend most of a thousand dollars on a new water heater when a simple fix would buy more time? After all, the water heater still has a few good years left and it's not leaking. Shouldn't a true professional at least offer a long-term solution?
Let's look at the math: Say the price of a water heater replacement is $1,000 (plug in your own numbers if you wish). Depending upon your area, water heaters may last from six to 12 years, so let's just use 10 years as a reasonable life span. That makes the new water heater worth $100 per year if it's replaced every 10 years. What if the water heater is replaced early, before it springs a leak? At eight years, the water heater works out to $125 per year instead of $100. Given the choice, would you rather save $25 or spend a day cleaning up the huge mess from a ruptured water heater?
This isn't even all of the equation. Remember that the thermocouple repair, costing $100 or more, has to be figured in somewhere. That pretty much washes out the savings by keeping the old unit another couple of years. So, in a nutshell, taking chances with a flood by choosing a cheap repair may not be the wisest option. To be sure, it's important to let the customer decide which way to go, but it is not disingenuous to offer the higher-priced option.
With this in mind, how helpful was Jimmy's sting operation? Is it good for our profession to take shots at other professionals just because they charge more or - perish the thought - actually sell upgrades? Perhaps the real target of stings should be the contractors who assume that all customers prefer stopgap repairs instead of long-term solutions?
The bigger picture is that it's much easier to tear down our profession than it is to improve it. The media is only too happy to expose "crooks" and all too often, the "crooks" aren't defined according to ethics but according to price.
Next month, we'll explore the ethics of pricing a bit more. I may even have a surprise or two for you.
Hilton's Hot Topic
Join our next “Hot Topic” online discussion: “Favorite Stings.” Have you been involved in a media sting? Do you have an opinion about contractor sting operations? To participate or simply listen in, send a blank e-mail to hot@serviceroundtable.com. You'll see firsthand how e-mail discussions work and, at the same time, have an opportunity to influence your industry. Note: The discussion will begin on Aug. 20 and will take place over the following two weeks, so sign up as soon as possible.
