I work for a builder.

Online purchases are not warrantied by us. If we or the plumber buys the fixtures then we know that we will not have to jump through hoops to get them replaced or fixed. The local supplier will jump through those hoops and we will not be out time and money.

You save money upfront but you will then have to deal with problems down the road.

We are fine with either option, we just make sure the customer is aware up front of how problems will be handled.

I purchased all of our plumbing fixtures online - faucets, showers, sinks and toilets. Even our Ann Sack's Onzen tub. We didn't have any issues with our builder doing this. We were also on a cost plus with him. He did not mark up any materials, etc. He only earned his percentage.

14 faucets/showers, 5 toilets, 9 sinks and 1 tub without any problems during or after installation (or the last 5 + years). If the plumber breaks something during installation, he would be responsible anyway. If a faucet didn't work, it's warranted by the company. So being "warrantied by us" means very little to me.

I would get the price from the plumber, including the faucets, etc. Then decide. That way, he won't mark up his labor beforehand, thinking you're not buying from him.

Cost plus means that you get his cost plus you pay an agreed upon markup on his cost. There was a time when consumers didn't have so much access to these items/prices direct and getting the builder's costs was a good deal. Now, consumers can sometimes do just as well on their own or better, but you still need the builder (unless you are DIY), so it is a bit of a catch-22. Even though you can get better prices, you need to consider who will be responsible for placing and paying for the order, tracking the order, inspecting the product upon receipt, correct specs, installation (and issues arising from), product failure/warranty issues, etc. It sounds like the builder feels responsible for much of this after you select the item and so he prefers to work with vendors and subs he trusts. However, you may be able to negotiate shopping your own sources if you can address some of those areas of potential liability. In fact, many builders are just fine with homeowners supplying or shopping around.

I think what he's suggesting is a what I would do for now: let him get you this bid on the plumbing, compare it to what you can find, then sit down with him to address. I do not think your builder is taking you for a ride, but you are not getting the best deal either. I think he prefers to do what works best for him, and you prefer to do what works best for you. Seek the middle ground together. I would definitely want to be able to take advantage of better pricing and would want my builder on board with that.

I've read many of your posts, so I am confident you did your due diligence choosing your builder. I also think you ensure you are an educated consumer, and he's becoming very aware of that. Continue to seek transparency and a mutually beneficial deal on this one. :)

"We were also on a cost plus with him. He did not mark up any materials, etc. He only earned his percentage."

Allison0704-Question: Is this semantics? As a designer I charge cost plus a %. I consider that % my markup. What did your builder earn his percentage on if not on any materials?

Musings.

Your explanation is great.

"So being "warrantied by us" means very little to me."

It can mean a lot to some homeowners. In this economy lots of subs ( and builders) are biting the dust. My bosses company pickups the slack when the plumbing sub goes bust and is not there to warranty the problems. One example for us is a complete new install of wood floors because of a plumbing problem on the companies dime. All profit from that job gone.

I agree with musing.

Our builder preferred to used local suppliers over the internet b/c if there was a problem then he didn't have to deal with it- he just let the vendor deal with it. It made his job easier, and for the most part, I was okay with it as long as the prices were reasonable and competative. The sales person at the local plumbing suplly store was fantastic and very helpful. My builder passed the complete trade discount onto us. The plumbing billed for his labor.

However the only clawfoot tub the local vendor offered was Kohler and it was completely out of our price range. I did request my builder to order a tub from vintage tub and he was willing.

I ordered many things online(light fixtures, medicine cabinets, cabinet hardware, mirrors, salvaged wood beams and shelves), but it was my job to make sure they were here on time; if they were damaged, I had to deal to with returning them. I was okay with this and my builder did not charge his cost plus for these few items. In the grand sceme of things it wasn't that much money anyway.

I may have become very cynical after our build, but to me this mean very little:

"song and dance about the plumber warrantying the fixtures and if there is a faulty valve and he has to take out the tile work to fix it, he will cover the cost of the tile work. Haven't seen this in writing though. . . "

That is assuming the plumber and builder are still there in 5 years, and they take reponsibility for repairing it.

You are not being taken for a ride by the builder-he's gaining no profit from this. Maybe the plumber. But I would get a quote from the plumber and compare to online prices and negotiate from there.

Thanks for all the input. Very good points. As far as the markup on the fixture goes, it goes to the plumber. I would pay the additional agreed upon percentage to the builder on the total bill of the plumber (so fixtures plus 10 percent markup plus labor). I have already told him there are a couple of things I am buying online (ticor sinks for example). He is fine with that.

It is just hard to see the price differences in things - pretty significant sometimes. I found the toto tub we were looking at for 2 baths for 427.00 at a build.com site - 1000.00 off list and we need two. Hard to swallow that difference - particularly since Fergusons (the plumbing supplier) doesn't carry Toto tubs. It brings the cost of this deeper tub in line with the Kohler Villager which is too shallow for us. We have a lot of fixtures to buy so it really mounts up! I would happily pay the 10 percent to the plumber and even another markup to my builder to save 2k.

As far as warrantying the work - I do think the builder does do this. We have friends that used him 5 years ago and have had an issue with a bathtub for the past 5 years. Just recently brought it up to the builder - it is a second home and they had just put up with it. He had his plumber down there 3 or 4 times to fix it - it became a battle between what Waterworks said was the problem and what actually was the problem. All this at no charge to the former clients. All this to say that I expect we will get the same service from this builder if we need it - he has been in the business for 20 plus years and isn't going anywhere I don't think.

If you want the toto tubs- then get the toto tubs. I think your builder will be fine with that.

I think you should look at the 10% as part of the labor charge vs. the fixture charge. You are paying extra for their service. Now, if the fixture charge at Fergusons is significantly higher than online-that's a completely different issue.

It should be noted that manufacturer's warranty doesn't cover labor. It also should be noted that things don't fail very often.

Tile work - it would be an unusual situation that would require tile work. I could only see this in a shower with a valve on an outside wall with brick or other masonry siding. You fix a shower valve with an approach from the back - ie drywall. So the tile work is a stupid argument. My builder wouldn't do a shower valve against the outside even without the freezing issue.

My builder got Grohe valves from Homeclick (back then) because that was better than what Ferguson would sell for. I have nothing particularly good to say about Ferguson's prices even with the plumber's discount. Moen on the other hand was better than faucet direct....

Ferguson's prices aren't great, for sure. They have a corner on the Atlanta market though.

Good point about shower on the exterior wall. We have one, at least. Freezing is really not an issue - but you are right about the tile work. Unfortunately - can't be remedied now because of the location of toilets and size of showers - would have to walk around the toilet in one bath to turn it on, and the other would have the shower pointing across the narrow shower instead of on the length of the shower. Should we insulate the pipes in these walls? Never thought about it!

To your clarification regarding the plumber's markup. Yes, it is standard for a reseller, which is essentially what the plumber is in this case, to add a markup to what he paid for the item. Each vendor is building in their profit in their bids to the builder. The builder then turns around and gives you the price he pays them on your behalf, plus his profit. And, it is eye-opening to see what things really cost. I don't mind the markups IF I can understand the value I get from them. If I can't, then I have a problem with it and negotiate a fairer deal for all, including me (just like you are). Of course, some vendors charge more just because they can and not because you are getting better product/service. In those cases, you definitely should negotiate for another vendor/fairer price.

Wait - Athens - you have a shower valve on an outside wall with masonry siding (ie brick/stone/stucco)? The potential issue is failure resulting in a leak. Then matching the tile and grout. Just something my builder wouldn't do. You can put the valve on the inside wall with the head on the outside wall (that is what we have with our hand held).

I'm not sure I would worry about freezing particularly with 2x6 walls. We are building at the beach which probably has the same design temp as you (20 degrees) and the architect upped the wall with a shower on it to 2x6. No masonry siding so easy to repair from the outside.

Yes we have a valve on the exterior wall in a kids bath. The rest are inside the walls. This is the one we can't move. It is the smallest bathroom (5 x 8), and if we swap things around it won't have a window (which we need for the elevation and which we have already ordered). Thankfully we are putting 26 cent subway tile in there so we can repair it more cheaply. I guess I will cross my fingers for no leaks!

Cost Plus is shorthand for Cost of the Work Plus a Fee. Typically a sub contractor would charge the GC his actual cost plus a predetermined fee. In this case the sub contractor fee is 10% and the GC would pass that on to you as his cost plus his fee.

Any discounts received by either contractor must be passed on to you. Misrepresenting the price paid could be considered a breach of contract or even fraud.

The reasons some online fixtures are cheaper than what a plumber can buy is often due to the large volume sold, the use of factory seconds, the use of knock-off materials, and the fact that there is little recourse if the product is faulty or damaged.

Since individual plumbers and plumbing suppliers need to charge enough to stay in business and are responsible for the quality and condition of their materials, if you want to build as cheaply as possible, you might avoid them altogether. But you should carry a contingency budget to pay for possible losses, sort of like being self-insured. If the toilet is poorly cast as is often the case with a manufacturer's second) and will therefore not sit level you might have to pay for a replacement and the cost of removal and installation.

FWIW - a friend works for HansGrohe - at one point Homeclick was just behind Ferguson as the high volume distributors. So I'm not sure I buy the volume explanation or the manufacturer's second either. No decent manufacturer would allow "seconds" to make it out of the factory and as you know, all these dealers are usually authorized.

No - Ferguson has a huge sales force and multiple brick and mortar cost holes. That is the reason for their high prices.

Online vs brick and mortar, no difference in quality of the item... at least for American Standard (a friend works for them). That's a story places like Ferguson's tells to get plumbers and builders to convince you that the price difference is worth it.

The plumber should warranty his work, not the fixture. If the fixture breaks, that's on the manufacturer.

What did your builder earn his percentage on if not on any materials?

Should have worded that differently. He got bids from subs, then our contract price was set at $X. Our GC earned 10% of the $X for his fee. If I went over budget on the build (or prices increased during the build), we didn't pay him more.

Like pps7, my builder passed the complete trade discount onto us.

Anthensmom - and correct me if I'm wrong - was saying her GC was charging her cost plus for the contract/build, plus another 10% on the plumbing fixtures as a mark up. Correct? --> I see she says farther down the plumber would be marking it up 10%.

The things I ordered (listed in my original post, above) were paid for out of pocket.

jmagill_zn4, I was only referring to plumbing fixtures (but it would go for lighting, in my case, too). But like Athensmom said later, our GC would have covered any problems. We became good friends during our build, even go to dinner with he and his wife. If we needed something now, over the 5 year mark, he would happily return.

As Dave Carey said, things don't fail very often. I can't think of a thing that failed on our build... but yes, I've heard the horror stories.

Seconds must be marked/sold as seconds.

Athensmom, we get the exact same weather. I would definitely insulated the outside shower valve. You probably won't have any problems, but if it stays below freezing for several days, you could always open cabinet/shower doors in that bath and leave the water dripping at night. Also, which way does that outside wall face? (Anything but north is best, anything that gets direct sun is better.)

Ha ha Allison - north of course! The contract is a cost plus 10 percent. The plumber gets his things at cost and then marks them up 10 percent so that goes into his total bill. Then there is a 10 percent on the builders fee.

I think the real problem is Fergusons. We live in a small town with several independent plumbing stores. As in all small towns, we know some of the principals. I might take the bid to them and see if they can meet or beat it. Would rather have a local plumbing company do the bid anyway :) Gonna call the builder tomorrow!

Oh well, it could be worse. At least you don't live in Wisconsin. ;)

We have a Fergusons here too, and would much rather deal with the locals. Good luck!

FWIW I was told that all Fergusons were independent operations. I think in general, franchises come in (at least) two distinct flavors: independent stores branded with the franchise name and stores run from on high by the franchise. It seems Ferguson is of the former type. Also, it's a "Wolsey" company, whatever that means (that's the parent company).

In some sense, then, your local Fergusons while a national chain, is also a local brick-and-mortar. I think. It's admittedly confusing.

In my competitive market, Ferguson's prices were OK-ish. They have a luscious showroom. How much percentage this value adds is between you and your conscience, I guess.

Thanks for the input. Fergusons is actually not local for us - in Atlanta, about an hour away. We have a much smaller, 3 location, supplier which is based in Athens, our home town. I'll see what they say.

"I thought I was supposed to get the material cost, taking advantage of all discounts the contractor gets"

That will never happen as it is not uncommon for the supplier to provide two invoices - one your builder shows you and one you never see. I've had this confirmed by suppliers in several different construction areas including plumbing. It is a way to kick back money to a builder.

Seems to be just part of it.

It may not be uncommon but it is not widespread. Any good builder or supplier will not do this. If they are doing this then they are also buying more supplies than they need and billing it to you, etc. etc. etc.

You should have weeded this kind of builder out by doing your homework before the bid process.

It's difficult to weed through collusion. Many things only become apparent when you're well into the process. At least in my area, it is widespread and only one part of an often dirty business.

Allison - Do you mind saying which online company your orders your plumbing fixtures from? I am thinking of taking that route too.

Gosh, it's been 6 years, so I don't recall names. I knew what sinks (Kohler Caxton) and toilets (Toto Drake, all but one are ADA so higher since we are tall) I wanted so I searched by those names. With Memorial Day coming up, many will be having sales - and watch for free shipping. Actually, Memorial Day weekend is when I ordered ours. I ordered the Onzen tub directly from the Ann Sack's store in Atlanta.

My sink/shower things came from Restoration Hardware - Bistro. I ordered those during their sale as well.

I picked out our fixtures at Fergusons only to go to Lowes and see the exact same item for well over 1/2 the price. I am taking it all back. Lesson learned.

I picked out our fixtures at Fergusons only to go to Lowes and see the exact same item for well over 1/2 the price. I am taking it all back. Lesson learned.

Before you do, just make sure that the item numbers are exactly the same. If they're not, it could be that they make the same item for Lowes but with lesser quality parts. If the item number is exactly the same, then I agree, buy from Lowes.

By not specifying the plumbing fixtures before the contract is signed you lose the ability to control their cost through competitive bidding and may therefore be exposed to multiple unknown markups and no accurate knowledge of the sub's price from the supplier since unrevealed discounts and delayed kickbacks are possible and sometime routine. This is illegal if the contract is written properly but I've never seen that in a contractor written contract.

If you list your fixtures in the contract as allowances, they become little Cost of the Work contracts inside the main contract but there is rarely a procedure for controlling the costs. The plumber should be required to show a receipt from his supplier and include any discounts or kickbacks and add a predetermined markup (if any). The GC should be required to show you that paperwork with his fee added. Don't expect that to be the same price as a retail store.

Allowances are handled very fairly in commercial work but not in home building. Since the contractors are used to add their profit to their cost it can be difficult to get them to embrace a cost plus approach.

My contractors all allow owners to pay Ferguson directly with no markup since their labor, overhead & profit is already in the base contract.

As an infill spec builder I found the simplest way to deal with plumbing was to draw up a detailed list of the fixtures and fittings and get competitive quotes from plumbing contractors for the whole job.

When we sought to "save" money by ordering fixtures and fittings separately, the time and bother wasn't worth it. Something always went awry and the endless effort spent trying to correct it could have been more profitably employed. (Now back to the latest list of fixtures and fittings. Aargh!)

The fixtures in the contract documents don't have to be the correct ones. As long as they are approximately the same quality, when you substitute the correct ones either the price won't change much or contractor will have to justify the change.

Eliminating Allowances is a goal all owners should insist upon.