Beer Line Installation Costs

[tapcleaner]

I have been a draft line cleaner for 5 years and now would like to get into installation. I have no idea what proper markup is or if I should charge hourly. Could anyone who has experience in this matter please lend some advice or experience . Thank you.

[Scott Zuhse]

Depends on what the market will bear and your sales skills. There are installers who simply hand a piece of paper with a number on it and keep their fingers crossed. Others put a lot of effort into a quote and spend time discussing features and benefits to the potential customer. Quite often they will get the job since the customer is basing their decision on value, not price.

Pricing can be as simple as quoting a certain percentage margin (40%??) over the cost of goods. This would cover install fee and your profit. Others mark up the cost of goods and add an install fee based on the job. This quote may comprise of 20% margin with 20 hours labor @ $80 / hour. the labor would be based on new construction versus replacement (demo fee), trunk line routing obstacles, tower locations, keg stations, number of faucets, etc.

Concentrate on selling systems and upgrades that will assure your customers low pour cost and high resale. A great start would be to attend the Dispense Institute @ Micro Matic.

[tapcleaner]

Thnaks for the info. Right now I have to bid on a glassware cooler/kegorator/
liquor stands/ and a general bottle/ pitcher cooler. I'm bidding against a very reputable refrigeration Co. Where should I bend on profit/ compared to the service contract?

[Scott Zuhse]

Not certain what your question is. Please clarify.

[tapcleaner]

Sorry, Should I lower my product prices(Refrige Equip) in order to get service contracts? And How do I properly price out a beer line installation quote?

[Scott Zuhse]

As to your refrigeration equipment bid, I would try to keep your margins as close to your competition as possible while selling the features / benefits of equipment. Hopefully you will get the service contract once you sell the equipment since you will be most familiar with this equipment.

As to the dispensing system, are you familiar with system design and the various components of a system?

[tapcleaner]

Yes I've been troubleshooting & cleaning draft systems for 5 years, but i'm only now looking into installation. I understand blenders/beer pumps/F.O.B.S./
etc..

[Scott Zuhse]

Great! Then based on your customers' dispensing needs, you would put together a detailed list of components for the system, source and cost them, estimate labor and build a presentation stating features and benefits supporting the value to your customer. Refer to earlier posts to determine your price to customer based on your costs and labor.

Hopefully you will apply the correct components so that the customer can achieve the highest value from your price. You should be able to assure your customer low pour cost due to minimal waste and high resale of their draft product since you have provided a system that can assure a quality product from the keg to the glass.

These are some of the topics discussed in the Micro Matic Dispense Institute's Advanced Draft Workshop. Check out the link for additional information.

[tapcleaner]

It sounds alot simpler than I thought. I've never liked the sales end of things, but I apprieciate you simplifing things for me. Thanks!

[Scott Zuhse]

These steps were never intended to be simple. Notice the comment about applying the correct components. This is not as simple as it sounds. Also, sales can be a tough nut to crack if you are not comfortable consulting with your customer on the features and benefits, thus value, of your design.

Do not go the route other installers have by skimping on parts / components to simply acquire a clear pour temporarily while quoting the lowest priced system.