Is it bad to expose competition working illegally?

DanielSon

DanielSon

Location
US
Hey guys,

Y'all are my peers and I have a question for you. In my neck of the woods competition has gotten so fierce that prices are getting shot down many cases under cost.

So many companies cheat on their workers compensation (by just not having it) and because of this they can afford to bid lower and lower and lower.

This is frustrating because I want to run legitimately, but with the prices that are being quoted, unless something changes, I'm having a hard time making enough of a profit to make it worthwhile.

Everybody always says "I don't talk bad about my competition", but I don't really think they are true "competition" if they are breaking the law. (Where I live if you have three or more employees and you don't have workers compensation, you're breaking the law.)

So is it wrong to expose them? I'm just so sick of wasting my time driving halfway across the city to bid on a $2000 job and find out that some goofball with no comp just bid it at 550 or 650.

I know the traditional thought is "I pay attention to my business", but I think that there should be a site somewhere that documents who runs legitimately and who doesn't.

So it's not wrong to set a website up like that?
 
Don't talk bad about people, but it can be legitimate and good advice to speak the truth. In some states (you have to find out for where ever you live) if Joe Homeowner hires a company with no insurance (including workers comp) then an employee gets hurt, that can fall back on the homeowner.

Make sure they know the risk they are getting into.

I advise people to get a copy of the certificate of insurance from people they are getting super low bids from.

love
nick
 
In my state, (Florida) we have alot of illegal immigrants, and what i've found out is, the client doen't care as long as they get the lower price. They roll the dice too. Had one client tell me, "the illegal immigrants don't sue, they just run".
 
It is always tough to toe the line and even tougher when you know that others are fudging.

Here's the question you need to ask. What would you do if you saw someone breaking into another's house? What would you do if you saw someone assaulting another? What would you do if you knew someone was being corrupt or otherwise breaking the law?

By and large I hate the policy that says "if only you have a suspicion please call the authorities" In and of itself such policy violates our rights to due process.

However, if we have evidence, or what looks like evidence, then isn't it incumbent upon us to pass that information on?

If the cheaters can laugh about what they do why can the non-cheaters laugh about turning them in?

If you have evidence, let the proper authorities know. They may or may not do anything about it but at least you know you have told the truth.

Meanwhile, continue to educate your customers and encourage them to watch their own backs by asking for a COI, references and portfolios.

Along the same lines, you need to ask yourself some serious questions about your customers. If a customer has no problem with a cheating company, do you really think they would have a problem cheating you?

I have learned the hard way that customers who try to be sneaky, complain about neighbors or prior contractors, try to slick or just don't care about things such as Illegals or possible damage to other people's property are also the same ones who tend to not pay, complain, lie and weasel out of agreements.

Just something to consider.
 
Most of us are professionals - it is time that we treat ourselves this way. It is okay to report companies not having any insurance, It is okay to talk to other companies breaking OSHA and ANSI laws. If we don't try to correct the illegal activities in our trade, we are not professionals and will be forever thought of as a pickup and chainsaw operation.

I always explain to my clients that they need to get the tree company's current copy of insurance from the insurance company. After all our certs show a years worth of coverage, when we may have only paid for 3 months. Since 9/11, it is true that, if the tree company does not have insurance and they get injured while doing the job on the homeowner's property; the homeowner's insurance is liable for the injury. We also try to educate the local insurance companies regarding this.

We would report all other professionals committing crimes, so it is time as Arboricultural Professionals that we report crimes in our own profession.

Make sure though that you are up to snuff on all your own insurance, credentials and training. It does no good to be the whistle blower if you are breaking the law and code of ethics also!!
 
[ QUOTE ]
Make sure though that you are up to snuff on all your own insurance, credentials and training. It does no good to be the whistle blower if you are breaking the law and code of ethics also!!

[/ QUOTE ]

Amen to that!
 
I don't think it's worth your time to focus energy on negative stuff like that. I get frustrated with it too but generally, the phone will ring and a good customer will come along at just the right time.
I try to focus on upping the QUALITY of my customers rather than the quantity. A few good ones beats the hell out of a passel of cheapskates.
 
I think about marketing like this alot. My competition are mostly "self taught?". I don't imagine they have insurance but they might. It isn't that expensive as rates are based on annual income. If you have 20 small operators doing the work that could be served by one professional operation their income from trees may be $20,000 each if their lucky. So minimal insuance and wcb rates. They do more damage than taking my work, they destroy trees with "pruning/topping" their removals are dangerous and give the us all a bad image.
The closest concept to negative marketing would be - Would you pay more for properly trained and equiped service, well you don't have to, bla bla bla. As my pricing is often lower than the clown who is rigging with thread bare yellow rope.

But think about major companies marketing. You never see negative marketing the closest was the pepsi/coke taste test. These companies have the highest paid marketing consultants,so you'd think they would know what they're doing.

It would be nice to have some control over who can call themselves a tree service professional. These guys are doing more harm than good to the trees and the trade.
 
I don't think that a website will help.

I think that you will need to try to screen your bid requests more effectively, and tactfully contrast yourself to the other guys.

If you are spending/ wasting time and money going after "cheapest-price" bids, you might spend more time and less money on the phone. Sorta like the phone company's line of "Phone first, before you go."

Ask how they heard about you, what they are looking for specifically, and if they are getting other bids. If they allude to calling everyone in the phonebook, politely decline. If they insist on a bid, offer one for a small fee, that will be credited against the work you do. Then you will see if they are really interested.

If it is the age-old "haircut", you can probe and find out if they just don't know about "haircuts" versus proper pruning, or if they don't care and will go with the lowest price over quality.

If they are not willing to meet with you at their home, I usually decline.

You can explain to them that you are an honest business, bringing honest employees to their home. You are insured, reliable, have references, legal employees that are both trained not to do stupid things and become injured, or break things, and if something happens, everyone is protected. They are protected from get sued or burgled (they know where you find you, which will be something the police will ask-- Have you had any contractors recently at your home).

"Are you mostly looking at the price of the work, or the value of the overall job being safely done, with insurances?" (including the security of an insured, honest, legal company over illegals operating at your home)?



Maybe focus on marketing yourself to those that really care more.

Have an discussion with your insurance agent about this, as they might have some tips and stats to use in selling yourself over illegal ops. That only takes a phone call, and you might get your company on the forefront of your agents mind, in case they know something.


Promote yourself positively, and tactfully contrast yourself against the other guys.
 
Just wrote up a classified ad for the local buy/sell.

Proper tree pruning for a healthy tree. Tight space large tree removal done right. Call--- Insured ISA Cert. Arborist.

Had a 25 word limit. What else is there to say?
Kept it postitive but hinted there may be some out there whose pruning ain't so great and removals are sketchy.
 
If I am told that another company is way low to my bid, I tell the prospective client to make sure they get a cert mailed from the insurer; some less then honest people carry fake certs with them to get over. I have made the sale a number of times after offering to have mine faxed/mailed right away.

If it is a prune I will talk to apples and oranges:the low-baller is probably less educated then I am. Pruning is about tree preservation. We want to allow the tree to exist with us, in it's given space for the longest time possible. I've lost count of the number of arbo's with stories of long term clients deciding to try out a low ball competitor and having the trees raped.

If the H/O is concerned with price alone, then we do not have a chance. A competent practitioner will sell his skills and knowledge rather then the process.
 
Great points all!

STOP BIDDING and START SELLING! Define your target market and pursue them. Get rid of bid chasers. The illegal immigrants may run if they can but dead is dead and on your lawn. So if their amigos have fled guess who is left with the body!

In sales we use things called FABs: Features (e.g., liability insurance, WCB, Bonded employees, certified workers); Advantages (better quality of work, protection against any possible negative outcomes); Benefit (your trees will look better and enhance the value of your property, no surprises if something goes wrong, peace of mind). Try to present in this way so the client clearly understands what they are getting for their hard earned money.

We must remember that our customers are often highly trained business people with an understanding of the sales process and will better appreciate being spoken to in the same professional manner they experience in their work.
 
I like Blinky's post, stay positive. However, has anyone successfully passed local legislation for Tree Work licensing or regulation? I think these types of things are rather positive. Good regulation benefits good companies and the public at large.
 
I'm all for a good set of rules for us to follow. That is what legitimately levels the playing field.

However, I am not necessarily for much of the licensing regulations that are in fact huge barriers to entry to the field and serve to benefit a very few, deep pocketed individuals in the industry and government.

I'm not sure what became of it, but I noticed Maryland was talking about some licensure a while back. If I understood it correctly, I could not offer my services in maryland without having first worked 5 years with a MD licensed arborist. This applied even though I had owned my own business for 15 years, was an ISA CA and had a proven track record.

just my two pennies.
 
City licensing of companies served to protect the residents and the city from liabilities. Most require liability insurance, some require worker's comp and bonding.

In one suburban city of Minneapolis a call to the police department would get an officer to a job site and shut them down until the license was in place.

Like Rick said, companies that aren't carrying required insurance are 'stealing'. A call to the police and city hall might give you a clearer path for solving this problem. Whether either have the inclination to follow-up is another issue. Like any wrong you have to decide how much energy you're going to invest in righting the wrong.
 
KY,

There are several levels/types of licenses. One I truly don't mind is the basic pay your fee and get registered. To me that is reasonable.

I'm also not opposed to a "skills & knowledge" test not too much unlike those for health care professionals. At least then, a standard level of knowledge needs to be demonstrated before calling yourself a professional. That said, though, there ought to be several "levels" of that to permit someone to start out on the ladder rather than having to find a way to levitate themselves to the first rung.

What I am opposed to are ones like that proposed by MD, or one that North Port Florida had requiring a "Competency" exam which had nothing to do with my ability to do work as an arbo.

In fact, it had nothing to do with my abilities at all. All it was was an opportunity for them to look at my personal and business financial books. I asked what they were looking for and reason was never made clear to me. I asked what I needed to prove and the answers were very vague.

Turns out all they wanted to know was if I was "good enough" to be seen in their town.

I guess my threshold is this, do the licensing/rules actually improve the quality of product for the consumers or does it make it harder for a new-to-this-town business to compete against the establishment?

I'd love to see a license here that is contingent upon proof of insurance and integrity of advertising. We have plenty of non-insured bozo's and at least one established big-dog that routinely advertises false credentials and worse, slanders other arbos.

I'm really not opposed to licenses in general. For example, as much as I find the pesticide app license a "barrier" I'm all for it.

About the only real problem I have with it though is that joe-homeowner can do anything he wants with the products from homer despot but if the state finds even a label in my truck I can get fined if I don't have a license.

There is a problem there but for a different topic.

Enjoy the day!
 
I'm not afraid to inform my potential customers of the poor practices in our industry. I don't, however, assume one company or another is operating without W.C. or paying under the table. I just hand them a copy of mine and tell them why I think it is important that they hire someone with the proper insurances.

If a company doesn't pay W.C. I think they pay under the table too. If they dodge those aspects, you may wonder if they carry General liability insurance too. Then, you may wonder what other good practices they actually follow.

It is a domino effect, IMO. So, I explain this domino effect to customers and the light bulb comes on. They understand that hiring a legit company is important.

Frankly, I hate that I have to spend the time assuring people I'm legit.
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I'm always is in a hurry.
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New Jersey has implemented a new licensing process. There are two tiers and it was developed in concert with the NJ chapter of the ISA.

Now it's a matter of implementation and enforcement.
 
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