For many years there was a silent conspiracy between architects, contractors, countertop fabricators, fixture suppliers and the kitchen and bath showrooms where customers worked with designers. Every professional wanted to get paid for handling every aspect of a customer’s job. I was recently at meeting of construction professionals where many contractors still felt no guilt in to refusing to install any materials that they didn’t order, ie make a profit on. One general contractor said he was intentionally absent when a homeowners granite countertop was templated and installed, again, because it hadn’t been purchased through him. What a recipe for disaster for everyone involved including that contractor.
By hiding the true cost of everyone’s services in the cost of materials or kickbacks, the public is kept in the dark about what they are really paying for.
A great example of how this system can be counter intuitive is that up until a couple of years ago all granite shops needed business from kitchen showrooms so badly that they had to inflate the cost of granite to their own walk in customers or else risk letting kitchen showroom referral customers find out that they were being charged a 20% markup by the showroom that sent them.
Many home builders charge three or four times the value of cabinetry and countertop upgrades pretending that the inflated charge was for material costs.
Everyone involved in a construction project needs to get compensated appropriately for a job to run smoothly, but under this system of hiding labor costs in material costs and hidden kickbacks, there ends up being an incentive to sell nice looking things that can be made cheaply and so don’t last.
Sadly well made cabinetry, fixtures, and other building products are often only 5 or 10 percent more than their poorly made cousins.
If only architects, contractors, countertop fabricators, fixture suppliers and kitchen and bath showrooms could be transparent, then homeowners would be able to make informed decisions about the professionals they chose to work with. And if consumers were paying the true price for better materials they would almost certainly be selecting them more often.
Happily this whole system is now being undermined by the ease of pricing things on the internet. Of course other new problems arise when customer’s don’t understand what they are pricing and are possibly ordering online. However just being able to better price things easily makes the old system problematic.
At Main Line Kitchen Design we try our best to be completely transparent and we nearly succeed. Occasionally, we are asked to pay a referral fee to an architect or builder, but we take it out of our profit as the cost of doing business. Our customers pay the same discounted pricing they always would. We also refer our customers to granite showrooms, lighting, flooring, and appliance specialists, but unlike other traditional showrooms we ask those specialists to sell to our customers directly and at our cost.
Our business model helps us be able to accomplish this, but soon all professionals will have little choice, and we hope this antiquated system will then truly be a thing of the past and professionals and consumers alike will benefit from the refreshing transparency.
Wishing you a transparent 2013,
………..and as Julia said “Bon Appetit!”