Online Contractor Referral Problems

By Greg Vanden Berge

I can't believe the money that some of these online contractor referral services are actually making today. It's getting to be out right robbery, and these costs are passed on, to the people that are using these referral services.

Let me explain, some of these companies charge outrageous fees and to give you an idea, some of the larger remodeling projects, can be anywhere from $55 and up.

Could you imagine paying $100, for a home remodeling referral?

Some of these contractors are paying large amounts of money, just to get your phone number and the opportunity to bid your job. The contractor pays the contractor referral service company a $70 fee, no matter what. If the contractor doesn't get the job, he still has to pay the online referral service company, the $70.

Now it sounds like the contractor is out $70, but the construction company really isn't out that money. Here's what happens, let's say that the online contractor referral service provides the contractor with five jobs and each job is costing the company $70. The construction company has now paid over $300, and advertising expenses.

Guess who pays these advertising expenses. The homeowner, or property owner is the one who ultimately ends up paying these advertising expenses. Keep this in mind, people using the online construction referral services, could end up paying, lots of money in the long run, to use a service that doesn't cost them any money at the very beginning.

It wouldn't hurt to do a little bit of investigative research, or ask the contractors, how much they pay for these services. If the contractor tells you that you're not going to be paying any money for these services and you believe them, you'd better go back to basic business school 101.

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