Lowballing, customer stealing, IRS cheaters

When I first went into business a guy I know in the business gave me a word of advice. He owns a high rise window cleaning company so he’s been around the block a couple times. He said “Charge a fair price and pay your taxes and the other window washers will be fine with you” He also told me about some of the new guys who decide not to pay their taxes so they can charge ridiculously low prices and steal work from legitimate companies. Then he gave me the friendly warning.

“When a new guy screws with us we call the IRS and shut him down.”

My question to the group is “Would you report a lowballing, customer stealing, tax cheater to the IRS?”

Mike,
My nature is to usually leave things alone and if someone is being a loser business-wise just let him reap what he sows. For the most part I’ve looked at customers who hire these jokers as not my target customers anyway. I suppose if it got out of hand and was giving the WC business in my area a bad name or was directly endangering my ability to conduct business, I would report these people, but only with CONCRETE evidence.

I started this thread because I was complaining about a couple lowballers in my market on another forum and other members jumped in and said “Call the IRS.” I was surprised at the feedback. At the time of this post the vote is 5 to 0 in favor of the call. Back in the day they would slash the lowballers tires.

How would you know for sure that they’re not paying taxes?
Seems like a slippery slope to me…

Indeed. We had an employee a few years back that had other odd jobs in the winter. At the same time he was filing for partial unemployment compensation. It was very frustrating thinking that he was probably getting paid under the table and sapping our UC fund. We wanted to spy on him etc., but didn’t quite go that far.

My guess is the other forum members were giving you advice that they themselves would not be following. Big talk…

My answer is, “No.”

My opinion is that most of these companies shoot themselves in the foot eventually. let it be.

How would this guy know how anyone filed? Sounds like he just wants a corner on the market to me, using any tactics he can think of, honest or not, to get it. He’s the same guy who runs cryin’ to mama any time things don’t go his way.

A while back an “honest” company tried to blackball me cause they felt I didn’t charge enough, even though I’d used the same pricing system for over a decade. I managed this company and a couple of the bids were way higher than they should’ve been for what was being done on the site.

When I approached the church-going, law-abiding owner and expressed this concern to him he said, “So? Why not charge as much as you can get away with? Do something extra for 'em if you feel so guilty,” which I already was doing.

This bothered me tremendously, especially since such a false facade was presented to their customers and community.

About this time, unbeknownst to me, the owner had grown tired of washing windows and had decided to sell off his customer list to a fellow church-goer of his. Remember, I was the manager, and I’d never missed a day and never been late, settin’ up the help for their days then working in the field the remainder myself. I come in one day, the very week my first promised raise is due, and the office is packed up.

“What’s goin’ on,” I ask.

“Well, we’re makin’ some changes,” says the owner.

Duh!

“I just don’t want to do it anymore. I’m goin’ back to school. You can try to get on with the guys I sold the list to.” So I did.

They treated me graciously enough when I first came on, quizzin’ me on the customers I’d been servicing for months now, learning the routes and the system, promising that I’d still be in charge of those areas.

Then they started actin’ like a little fraternity, hoarding the best payin’ jobs for themselves, and throwin’ me the scraps. There was no way to feed my family on what they were giving me, so I told the customers on my final time around that I wouldn’t be back next scheduled service, returned the pole I’d borrowed, and politely turned down the next meager workload offered to me, and struck out on my own.

Amazingly, over the next few weeks I received call after call from “their” customers, saying, “You gave us the best service we’d ever had. Are you available?”

Certainly, I’d say!

Naturally, next came the threat of a lawsuit if I didn’t relinquish the customers. Knowing the state was a “right to work” one, I stood my ground against against two of the “big boys.” The tactic failed, so they resorted to spreading the word that my tools were actually theirs, and that I was undermining the whole industry with low-ball tactics. These were lies. My tool belt, and all the tools in it I’d had for years, and my prices were right down the middle of the road, not to mention system-based and honest, unlike theirs. If anything, these dishonest tactics tactics lost them more loyal customers than anything. Despite a total lack of listings or advertising, word spread and customers I’d serviced as long ago as 2 years before found me through word of mouth and referrals. I’d hear horror stories from them about the service they’d received from my previous employers.

The moral of the story is, there’s more than one way to be a low-down, dirty cheat. Just because someone appears to be honest doesn’t make it so.

I ditto that!!!

No one likes a tattle tale…

I agree, any shady business will eventually get caught up in their own fantasy. I wouldn’t waste your time, effort, or good name with these cronies.

i’ll chime in on this one.
mike and i talked about this a couple weeks ago on the phone… we share the same area with a lot of these kinds of companies.
my vote would be NOT to go tattle tale on another company… it could always come back to bite you. just bc someone tells you they conduct business a certain way or cuts corners or whatever they could be setting you up… its just like poker. i could tell you i have a 7 - 2 off suit but i could be holding pocket kings…
if you try to pull the plug on someone and they find out who it was and they arent shut down or put in jail you can bet they would come after you and your business… i mean who wouldnt after screwing with their livelihood? i know i would, i definitely would.
the only relationships in business and life i try to cultivate are positive ones… i dont concern myself with how every other business conducts themselves window cleaning or otherwise…
i will admit it is tough to sit back as someone ruins the market in a great town by lowballing every job… but instead of dropping my prices to try to compete with them im actually going to be increasing my pricing by 20% effective 2010. the changes i have planned for 2010 will set my business apart from those fools who want to work for m&m’s. i work for cookies, big f’ing cookies :smiley:

Yeah it is a ****ty thing that is going on but you need to look beyond that.
Yeah everyone is bitching about how the economy is, what it has done to their business , Some it hasn’t effected to badly and others it has been prosperous for them.
Did you or anyone else pretty much have low prices when you / they first started out ? Sure you did ! Did you think about the company that was cleaning there windows that you took away from ? Hell no you were clicking your heals and on cloud 9 thinking how much more business you were going to get.It looks like you have a pretty good window cleaning business going and you must of been doing something right to be in it this long.
It is typical business sense you will lose some customers and the one’s you lose they were obviously looking for a better deal just like when you came along trying to get there business.
Like a lot of the posts said … Leave it alone be the better business man !
Granite phoenix arizona’s climate is totaly different and you can clean windows pretty much all year round and another thing is that there are over 4 million people here.
But as far as the low baller guys there who knows if they are paying there taxes or not … If your paying your taxes then that is all that matters.
You are more than 3x7 and you need to just keep doing what you are good at and if that is cleaning windows and getting new business keep doing it.
Who cares what the others are doing they are either legit or they are not and if they are not well then its them that are going to have to pay the consenquences right ?
Anyways that is just my 2 cents.
some may get offended and some may not but a lot may have the same feeling.

Personally, I got a problem with a snitch. The guy who you spoke to who said that, in my book is a dirtbag snitch. Weather he has been around the block or not. I pay taxes, and I charge probably more than HE does, but I would not go out of my way to put the dogs on a victim. I hate it when people low ball, but really…I am WAY over it now…and my customers are completely different than the ones hireing the low baller anyway.

He is probably talking about the high rise game, which in my understanding, is pretty much a small club. Here in San Diego, there are about 6 companies…and they all know each other. Lots of poliltics. They will blackball you too…they can try anyway. At least that is how they would like people to see it.

No I would not call the IRS, plus, what if they ARE paying taxes, dont something happen to you for giving false information?

If you are being accused of doing something, you have the right to know WHO is accusing you of wrong doing (unless you did it anonymously) I agree with most on here. Let the IRS catch up to him. Thats THEIR job.

Hey Group,
At the time of this post the nice guys have gained some ground on the not so nice. It’s 11 to 6. I run a one man show so the lowballers really have no effect on me. I have always had way more work than I can possibly handle. It was a lively topic on the other forum so I decided to throw it out here.

Another way to look at this is that lowballers attract price shoppers so they are also doing us a favor.

The lowballer will always be with us. It seems that a new one always replaces the old. They come and go because that method of operating doesn’t seem to work over the long haul. .

Loved these two lines.

Epic post.

:cool:

[COLOR=black][FONT=Verdana]The word get’s out from their employees because they usually 1099 their employees to keep payroll expenses down. With no payroll taxes or workman’s compensation to pay they can afford to work for less. In my market lots of painters, carpenters, landscapers, roofers, and of course window washers 1099 their employees. The IRS heavily frowns on the practice and will shut a business down. Most of the guys I have talked to about not 1099 ing their employees disagree with me strongly. They see nothing wrong with it. They should call the IRS to see if they are wrong before the IRS calls them, because it is against the law to 1099 an employee. :eek:[/FONT][/COLOR]

[COLOR=black][FONT=Verdana]By the way the topic on the other forum was 1099ing employees. [/FONT][/COLOR]

It amazes that anyone in business for a considerable amount of time could possibly think it is acceptable to 1099 someone who is under your direct care and direction with your equipment and vehicles. Everybody would take that route and Uncle Sam and his 50 sons would be out billions of dollars.