Hourly Rate vs. Flat Rate

One would assume that flat rates always win because you know exactly how much you will pay, no surprises, etc.  But that’s not the company in moving. You see, moving companies have succeeded in making something so simple to be so complicated. Is a flat rate price bad? No, there are legitimate flat rate companies out there that make the moving process easier, take for example the legendary Flat Rate of NYC – they actually give their customers a real flat rate price and it is the final price, no less no more.  Albeit, it’s a very expensive price but rightly so, it has to be. A flat rate price needs to account for every possible scenario that may affect the time it takes to complete a move. Some customer are willing to pay more so that they don’t have to deal with a hassle, but they need to understand that a real flat rate price will always be more expensive than an hourly rate estimate because it’s just an estimate. As mentioned earlier, moving companies have found a way to make it complicated what with hidden charges and complicated contracts. They have found a way to give a cheap flat rate price and then tack on added fees for all sorts of things. In this case, an hourly rate company would be better to go with. Hourly rate estimates will typically account for things such as number of workers, fuel, materials needed, tolls, etc.  Take for example a short 2-hour move quoted a $225 by an hourly rate company. After paying workers and fuel, the company is left with approximately $120 and after paying taxes, only $85. With a flat rate company, assuming they gave a lower price than the hourly rate company, they will most likely be losing money based on these factors. If for any reason the move takes longer, due to traffic or the elevator not being reserved, the company will not make any profit and will soon be out of business. So how do these flat rate companies do it? The answer is pretty simple but tricky:

1) Hire day laborers and cheap labor

2) Only accept payment in cash, avoid paying taxes

3) Rush through the job without paying attention to details

4) Hidden charges

5) Complicated contract

Regarding #5, the company may offer to move your 1-bedroom apartment for $120, but they will give you a limited list of items that can be moved at that price, no exceptions.  Any additional items will cost you more. Also things like long carry walks, stairs, elevator usage, tolls, etc will cost you extra and in the end you will wind up paying the same if not more than the hourly rate company.  So in conclusion, is a flat rate company better than an hourly rate company? The answer is, do your research. The most important advice is to check out the company’s rating with the Better Business Bureau. There are good and bad companies of both types. For example, if you get a few quotes from both flat rate and hourly rate companies, and you find that the flat rate quotes are cheaper, it’s best to skip it, the price will most likely go up. As a rule of thumb: a flat rate price should be higher than an hourly rate estimate.

 

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Moving broker scam

Watch Out!!!

One of the most common selling tactics in the moving industry has to do withDallas movingcompanies taking advantage of and victimizing customers by putting them under high pressure situations. When you contact companies for a quote, you sometimes don’t know who you are speaking to, it may be a moving company or it could be a broker. In this article, I will focus on brokers.

 Moving brokers are the biggest scam in the moving industry, never book with a broker!  A broker is a company that sells a service (in this case a moving service) to a customer and then turns around and sells that job to a moving company to do. Did you ever wonder why a broker’s estimate is so much cheaper than a moving company’s estimate? How can a broker be cheaper and still make a profit? 

I have been in this industry for 13 years now and have never worked with a broker for one reason - brokers give low ball prices to customers to get the business and the only way for a moving company to make a profit is to raise the price! That’s just not my business practice. Brokers put the customer under high pressure to book now, they make them pay a deposit (usually 50% of the estimate upfront)and then they sell your job to any moving company who’s willing to buy it. The customer is left not knowing who the moving company is that will show up, and the broker doesn’t care if the moving company has a lot of complaints with the BBB or lots of horror stories online - their main goal is to sell! Now since the job was sold at such a low price to the customer, and after the broker takes their share of the money, the moving company that services the move has no other option but to raise the price on you. It’s guaranteed that you will pay more than the estimate quoted. And if you’re lucky, the moving company will even show up! I have heard endless stories from customers who booked with a broker and then the moving company either doesn’t show up or cancels the move completely!

Do yourself a favor – if you somehow figured out that you are dealing with a broker, put your sneakers on and run! Think about this scenario:  you submit your information on a website where you will get quotes from 5-7 moving companies. These companies will contact you and compete for your business. You will most likely be overwhelmed from the volume of phone calls. Oftentimes, customers are just looking based on the cheapest price (which is the worst thing to do when looking for a mover by the way). You speak to a sales person that sounds super nice and helpful but they tell you that you need to book now in order to take advantage of the price. You are happy to book because you think you are getting a good deal and then you give a deposit. On move day, the moving truck appears with a different name from the company you booked with. They have you sign a moving service contract and then something called a “revised written estimate”. Then they tell you ‘Ah excuse me sir/ma’am, you have more items here than what’s on the list so it’s going to be another $1400 to complete this move and for us to get started on this move, we will need you to sign here’. At this point you feel sick to your stomach because you did not budget for double the cost, and in a few hours you have a flight to catch, so what do you do? You pay double the estimate knowing you had no other choice.

Yes, this happens every day to good, hardworking people. People that the only thing they wanted to do was to save some cash. There are some ways to save, just not with a broker. If you want to save, use a true, local moving company. Local moving companies are much cheaper, and if you research right you will find a reputable one to move you for a great price. Compare prices of top rated local moving companies and have them compete with each other!  Now that’s a smart shopper. Don’t fall for low ball estimates!

We have a large list of brokers that identify themselves as movers – feel free to email us the name and we might be able to tell you if they are in fact a moving company or a broker. And of course if you decide to us, you will be contracted with a real moving company!


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