Ring! Ring!
Me: I.T. Department, this is Daniel. How can I help you?
Caller: Are you hiring?
Me: As it happens, I’m writing up a description for a project I need assistance with. I was going to send it out to other business owners, first. What are your skills?
Caller: I’m good with computers? I mean, I’m always cleaning up the family computer, and sometimes Dad’s office computers, too.
Me: OK. And what tools do you use to do that?
Caller: I use CCleaner to remove programs that are not needed. I use PowerShell to manually tune and tweak the TCP/IP stack. I clean the registry. Change user permissions, set up shares and that kind of stuff.
Me: That’s not bad. Do you have any experience with hard drive optimization or database configuration and management?
Caller: No, not yet. But I’m a quick learner. I just need to understand the why and I will get it.
Me: Fair enough. You are young and still learning. Let me tell you about the project I have bid on and the help I will need. A company refresh. Replacing 30 workstations. Unbox, plugin, and setup. Connect to the network, rename, add to the domain. Clear old equipment to the staging area while it the workstation is rebooting. I will be in the server room replacing the servers, consolidating them into virtual machines on the new server. I need someone who can work, unsupervised, reliably and quickly.
Caller: I can do that, though I will admit, I would rather be in the server room with you, learning about the virtual stuff. How many hours do you think for those 30 machines?
Me: if you do it right and get into a good rhythm, I suspect you can get all 30 machines swapped out in about 5 hours. Should only take you 10 minutes per machine. There will be a flatbed cart so you can move two or three workstations at a time. That will cut down some of the travel time. It may take up to 6 hours, depending upon a few of the workstation configurations.
Caller: I can do that. When can I start?
Me: It is not a done deal, yet. I have to win the bid, first. I need to get my labor costs figured out so I can set the bid, appropriately.
Caller: So … that means what?
Me: That means I have a few more questions for you. This is a project. A contract gig for 5 to 6 hours of your time, on either a Friday, a Saturday or a Monday. So, give me a flat rate bid on how much you expect to be paid for the project?
Caller: What is a ‘flat rate bid’?
Me: That is where you state you will do the job for X dollars. If it takes 4 hours you make out well. If it takes you 7 hours you still get the same amount of money. This encourages you to work smartly, efficiently and quickly. Mistakes will be your responsibility to return and correct at no additional charge.
Caller: I’m not doing that. I will set up the machines as you asked, for $60 per hour.
Me: OK. Thank you. Your rate is far too high for this kind of work.
Caller: Wait! $45 per hour?
Me: I’m sorry, but no. Setting 30 computers on desks is not a $2000 job.
Caller: Then how much are you offering?
Me: I have budgeted $600 for the 6 hour project. If you get it done, and all 30 machines are correctly setup and installed on the desks, in less than 6 hours, I will give a 10% bonus for early and timely completion. The work is not difficult. It just requires good attention to detail skills and time vs task management.
Caller: I’m worth more than $10 an hour! You are ripping people off!
Me: I’m sorry you feel that way. I’m bidding on a project and already cutting the labor costs as narrow as I can just to get the bid. I will probably lose money on the project, but I’m hoping to make it up on the continued services contract. This is a part of business.
Caller: F*&^ YOU!
I hang up the phone as the young man is screaming and shouting obscenities at me.
A week later, I learn I lost the bid and I call up my friend who won it.
Me: Hey, Erick! Great job on landing that bid!
Erick: Thanks. I’m going to lose my ass on it, though. The client is a cheap son of a you know what and he just does not understand how much time is required to do it and the skill investment to do it right on the servers.
Me: I get it. I think I lost it on the labor aspect of the bid. I offered a young man $600 to set up the 30 machines as a 1099 project and he told me he was not willing to do it.
Erick: How much did he want? $50 a machine?
Me: He wanted $60 an HOUR. Was not willing to work project based. With the layout of the main floor, 20 of those machines could be installed, plugged in and set up inside of three hours. The other 10 are in the offices and would take a little longer. $20 a machine is a more than fair price.
Erick: I’m paying a young man minimum wage to put the machines on the desks. It’s the only way I could get the labor down to slide under the client’s budget.
Me: I get it. Seriously, though, great job on landing the bid.
Erick: By the way, are you available to do the migrations to virtual machines? And if so, how much will you charge me, per server?
Me: I am, but it would be more than you are able to pay, Erick, and still keep any profit. But call me if you get in a jam. If I’m free, I will help you out of it, if I can. Gotta take care of those paying client,s first, my friend.
Erick: Oh, I get it! And I would do the same thing. You should stop by the office, soon. We have some catching up to do.
Me: Will do, Erick.
The morning of the install, Erick calls me.
Erick: Dan? I’m so screwed. My guys who were going to set up the workstations are a no-show. Do you have anyone you can recommend?
Me: Just the kid I was telling you about. Do you want his number?
Erick: Yes, please. As soon as you can!
Me: OK. Let me see what I can do for you.
So I call back the young man from the week before.
Me: Hello, this is Daniel with the I.T. Department. We spoke a week or so ago about a project for a bid I was working on?
Young Tech: Yeah, I remember. I’m really sorry how I yelled at you and the names I called you. I thought you were trying to rip me off.
Me: I get it. But tell me, what changed your mind?
Young Tech: A buddy of mine in college told me about a platform for tech work. FieldNotion I think it is. They don’t pay worth a damn on that site, but that is what the labor is worth, right?
Me: That is what low skilled labor is worth. You have a few skills, son, but not enough for the high hourly bill rate. Did you look on Craigslist for how much people are getting paid to clean up home computers?
Young Tech: Yeah, I did. That is easily a $100 per hour value job, but people are doing it there for $35 as a project! It is ridiculous!
Me: Well, look at it this way. If you paid only $200 for the computer form Wallyworld, would you want to drop $200 or even $300 in having it cleaned up?
Young Tech: No. I would just replace it for that.
Me: Exactly. Now, that bid I was working on? I did not win it, but a buddy of mine did. And the guys he had lined up to do the work are no shows. He was paying them minimum wage because it is mostly just grunt work. You MIGHT, MAYBE, could get $10 an hour from him. But I believe if you offered him a project rate, you could get more out of him. But you will have to bring you’re A-Game. He’s a great guy and this could lead to more work for you, with him.
Young Tech: So he is desperate? How much do you think I can get from him for it?
Me: He worked up his bid on minimum wage for two guys for three hours each. That is less than $100, total.
Young Tech: that is about the same as the platforms would offer it at. Think I could get $200out of him?
Me: I don’t think so. But if you do it as a project, you might get $150.
Young Tech: That’s only $5 per machine!
Me: Yes. I know.
Young Tech: Thanks, but, no thanks. I have some pride left.
Me: I get it. Just in case you change your mind, his number is ***-***-****. His name is Erick.
Upon disconnecting, I called Erick back and was sharing the conversation when he disconnected to take another call. He called me back, shortly after.
Erick: That was the kid you were just telling me about. He wants $300 set up the machines.
Me: That’s really not a bad price, Erick. Flat rate, right?
Erick: Yeah. Can you vouch for this kid?
Me: Nope. I only interviewed him on the phone.
Erick: Is he a good kid?
Me: The first time we spoke he was hit with low skill labor value. He had a few choice words and names for me. We both have been there. When I called him, this morning, he immediately apologized. He’s been looking on Craigslist and the platforms. He is seeing the disparity between what he is told the work is worth at our skill level versus what it is at his skill level. I think that takes some spine to see and still negotiate a more reasonable rate for the work.
Erick: OK. I will hire him. But can you do me a favor? A BIG favor?
Me: You want me to come in and do the server migrations?
Erick: Please? I’m already behind schedule.
Me: Yeah, man. I will be in shortly. I will give you a few hours to show you how and you can do the rest, alright?
Erick: Thanks, man! You are a lifesaver! We will work out a deal on that server you want?
Me: Let’s see how difficult this is, first.