Published on 28 Aug, 2017

Have you noticed how online platforms that connect homeowners with local tradesmen always forget to mention prominently how much their service costs? Some of you have probably investigated and found that there are actually answers, but they are usually in the small print or hidden somewhere at the back of a long list of useless answers on a FAQ page. As you probably suspect, there’s a good reason for that:

Q: Do homeowners know that contractors pay shortlist fees?
A: Telling clients how tradesmen are charged would lead to fewer jobs posted.

the FAQ section of some builders’ platform.

What they convolutedly are saying is “if homeowners knew the true cost of our service, they would not use our platform”.

So, let’s find out the true cost, shall we? In order to do that we’ll take two imaginary platforms that we just invented (our imagination is truly unlimited) – Someone’s Builder (SB) and Guys with a Rating (GR). In the Google of our dreams (Doogle?) they always buy ads and occupy prominent positions in search.

So, what does SB share in their small print? They charge contractors an average of £18.5 + VAT each time they are shortlisted for a job. And, according to SB, tradesmen are shortlisted an average of 6 times before they actually win a job. Take that as you wish, your mileage may vary. So, to win an average job a tradesman is forced to pay more than £133. And, don’t be fooled – this overhead is going to be paid by the client. So, homeowners are posting their jobs for ‘free’, but in reality are paying a significant charge for the convenience to shortlist a few builders for their project. And, don’t forget this is an average number, so actual charges vary significantly and can be as high as £336 per project.

Now, let’s look at GR. Their service is a bit broader and besides builders, they accommodate cleaners and movers as well. Because such jobs tend to be of significantly lower value, the average price of a lead is quite a bit lower at £15 + VAT. GR, however, are also charging a £15 + VAT monthly fee on top (because of course they are). With an average success rate of 1 in 3 jobs, a contractor on GR’s platform is paying an average of £72, which is naturally included in the total cost of the project. Keep in mind that the true average cost for serious home improvement projects (that do not involve cleaning or removals) will be significantly higher, probably in line with what SB users are forced to pay.

In conclusion, in our imaginary world where Doogle reigns supreme and SB and GR are the kings of home improvement in Doogle search, contractors, respectively homeowners may expect to pay between £72 and £336 per project. So, next time you are ready to post your job and hire a contractor on similar platforms, think twice about how much extra you may be forced to pay. And if you still prefer the perceived convenience, oh, the irony! They just managed to take your project and sell it to a tradesman, who then charged you back with the overhead not only of your own project, but also of a few others. We’ve got to give it to them, they’re pretty smart. Apparently, our imagination is truly resourceful today. The trouble is, sometimes reality can be even more unsettling.

Do you have an insight on the topic you’d like to share? Maybe your imagination is wilder than ours? Feel free to sound off in the comments.

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