Paying $200 For A Construction Lead
It's hard to imagine, someone paying lots of money,
simply to get a phone number for someone who is interested in getting
some work done on their property. But this has been going on for quite a
few years now in the construction business.
I don't know what the record is, but could you imagine paying over $1000, just to get a construction job. It seems to be getting worse and not better. When Henry Ford started making the model T, I believe the price of the car, was around $700. Within a short period of time, he was making more cars and selling them for less than $400. This is something that benefits society.
Here's what's happening in the contractor referral service business. These people are raising their rates and making even more money. The money that they're making, lets them dominate the referral business network, placing a burden on small contractors who were competing for the same business.
Here's how one company operates, you fill out the online request form, they send your information to four contractors, each one of these contractors pays $50 each for your information and the company collects $200. Not bad for a few minutes to work.
I'm sure that you're thinking that this isn't fair for the contractors, but it's really not fair for the homeowners or the people that are paying for this free service. Ultimately the contractor will pass these costs on to the homeowners or people that are paying to have them work on their property.
Ultimately, the homeowner is the one that loses as these cost of doing business, are passed directly onto them. Something to think about, some things that are free, still end up costing other people money in the long run.