Notes from the Editor: Hitting The Ceiling

Oct. 2, 2018
Should a locksmith's price for labor remain the same when a customer orders the hardware on the Internet rather than from the locksmith?

Our office is located in Chicago, a city which has gained negative publicity for its treatment of minorities. This publicity is based on fact as minorities are often relegated to a cycle of low-pay jobs with little hope for anything better in the future. In many ways small businesses of any kind face the same dilemma. We are called 'small' business for a reason. Our jobs are usually short range, labor intensive events. There is only a finite amount of labor time in each day, so pricing for labor becomes the income ceiling and a limiting factor to business success.

When someone loses the keys to their car, locksmiths get the job. When someone locks themselves out, locksmiths get the job. When a lock malfunctions, locksmiths get the job. When a safe combination is lost, locksmiths get the job. You get the picture. Since these jobs do not involve the sale of big ticket items, locksmiths win every one of these jobs by default.

When it comes to jobs requiring a long list of new hardware, the story is completely different. This labor/parts situation was made clear once more after a locksmith company contacted our office asking for advice. This locksmith and his customer in question had a business relationship which was developed over many years. The customer was now requesting new hardware to be installed at their building. The locksmith submitted a quote which was over $25,000.

With so many internet sites sending out feelers every day, it is understandable that the locksmith's customer would test the waters and ask for a quote from someone on the internet. That other source submitted a bid much lower than the $25,000 bid from the locksmith. However, the bid did not include installation labor. The customer in question then asked the locksmith to only install the hardware for his originally quoted price while the hardware would be purchased from the internet source.

Should the labor price remain the same since no hardware is being sold? Who is responsible if there is a hardware problem at a later date? Should the locksmith not accept the job at all and possibly lose his valued customer as a client? Regardless of the answer, we are all hitting an income ceiling today which is completely out of our control.