It’s always better to be safe than sorry when hiring a company to do any type of repair work on your home. Garage door repairs are no different. There are thousands of unethical garage door companies (sometimes referred to as “Bad Bobs”) that are preying on customers across the country. They rely on their deceptive company names and advertising to trick the customer into believing they have hired a reputable, neighborhood garage door company.
The following is an article that was published by Door & Access Systems Magazine in their Spring 2003 issue [pages 44-45]. The article sheds some light on several different tactics that the Bad Bob companies use, as well as some useful information for homeowners on what to look out for when selecting a garage door company.
Bad Bob’s Yellow Page Scheme
© 2003 Door & Access Systems
Publish Date: Spring 2003
Author: Tom Wadsworth
In the last few years, some dealers have discovered a way to make big money in the garage door business. Yellow Pages advertising is the cornerstone of the scheme.
Several details of the scheme are sleazy, many are deceptive, and some details are outright illegal. However, some dealers don’t care about that, and they end up giving the entire garage door business a bad name.
Here’s a general description of how the scheme would work for an unethical dealer we’ll call “Bad Bob.”
- Locate in a Large Metropolitan Area.
Since many of Bad Bob’s tactics might be viewed as unethical, he will target large-population centers where the consumer is unlikely to know him. Even if he creates some angry customers who might tell a dozen people, Bad Bob knows he can still prey on hundreds of thousands of other people who don’t know what he’s doing.
- Buy Giant Yellow Page Ads.
This is the key element of the strategy. Dealers have long recognized that Yellow Page advertising is a critical element in any dealer’s marketing plan. Since consumers generally need door service only a few times in their lifetime, they will frequently rely on the Yellow Page to find a local dealer.
In his Yellow Page ad, Bad Bob’s strategy is to give the consumer the impression that he is credible. Here’s how he does it:
- Be huge. Bob buys a full-color ad or even a two-page ad. The consumers figure, “Gee, if he can afford a giant ad, he must be credible.” They don’t need to know that Bad Bob operates out of a house.
- Be first. Bob does whatever it takes to be listed first. He will often create a company name that begins with “A,” because he knows consumers will often call the first name on the list.
- Buy multiple ads. He often buys 2-4 full page ads or a couple of double truck ads. (2- page ads). With all Bad Bob’s ads listed first in the Yellow Pages, the consumer is extremely likely to call the phone number on at least one of them.
- Use several company names. Bob often advertises under several company names, so the consumer will call at least one of his numbers. The consumer will never know that Bad Bob is actually the only person behind all these companies.
- Use as many brand names and logos as possible. Bad Bob is usually not an authorized dealer of these brands, and this tactic is illegal. Bad Bob knows that his Yellow Page rep will never check it out. Bad Bob often uses recognized names like Sears and Craftsman. Even if a manufacturer seeks legal action against Bad Bob, he knows they will often just send him a “cease and desist” letter. By then, this scheme will have earned Bad Bob a boatload of money.
- Focus on service work. Bad Bob’s ads use a big photo of a broken spring to target the homeowner who needs quick service. Service work and replacement parts have always reaped a lot more profit than new construction work. Bad Bob doesn’t worry about new construction work; the slim profit margins aren’t worth his effort.
- Promise quick response. Remember: Bad Bob is targeting service work. His ad highlights “24-hour service” and Emergency service within an hour.” Bad Bob gets in that garage fast, before a reputable dealer claims the turf.
- Mention “Senior Citizen Discount.” This phrase works every time for Bad Bob. He might go ahead and give seniors some token discount, but he makes sure his “regular charges” are exorbitant. The Bob laughs all the way to the bank.
- Promise “Low Prices.” Bob often uses this time-proven phrase, except he doesn’t really charge low prices. Bob knows that homeowners have no clue as to the real cost of garage door parts.
- Post many phone numbers. In metropolitan areas, suburban homeowners like to believe the dealer is in their neighborhood. So, Bad Bob often publishes a different phone number for each of the major suburbs, but all calls are transferred to Bad Bob’s one location. A bunch of phone numbers is cheap, and they make Bad Bob look as if he actually reputable.
- Boast “Voted #1 in Customer Service.” This, too, is false advertising, but Bad Bob figures that his Yellow Pages rep doesn’t care, and no one realizes that Bad Bob is the only one who cast a vote! By the time Bad Bob is forced to remove this from his annual ad, he will have scammed hundreds of people for mega-thousands of dollars.
- Look reputable by displaying certain pictures. Good examples: (1) clean-cut guy with a uniformed shirt and clipboard, (2) new service trucks with Bad Bob’s logo on them, (3) expensive looking houses. None of these need to be real. Bad Bob knows his Yellow Page rep can get these images and will even print Bad Bob’s logo on the side of a picture of a blank service truck.
- Negotiate Lower Prices for Yellow Page Ads.
Since the Yellow Pages are Bad Bob’s largest expense, he must get the lowest possible price for these ads. To do that Bad Bob is often part of a national chain of sleazy door dealers. That way, the chain’s “central office” can negotiate sweet deals with low national rates.
- Charge Exorbitant Rates.
These Yellow Pages ads often cost Bad Bob $250,000 or more than $1 million per year. To pay for that, Bad Bob needs to maximize profits. So Bad Bob doesn’t mess with measly 10% mark-ups. He charges 5-20 times each part’s real cost. When the scheme is working properly, Bad Bob rakes in more than $100,000 per week.
- Use Subcontractors as Technicians.
Bad Bob needs to motivate his service guys to cooperate with the scheme. If Bad Bob pays employee-technicians by the hour, he knows that the tech will have no motivation to rack up a big bill and finish the job quickly. If the technicians are salaried employees, Bad Bob usually needs to buy their trucks and tools and pay benefits and vacation time.
Instead, Bad Bob hires subcontractors who often have their own trucks and tools, and he pays them an attractive commission on each ticket. This gives them every reason to generate big tickets with every customer. Subcontractors are more likely to understand profit motive and are less likely to wimp out when Bad Bob tells them to rack up at least $400.00 in charges to each customer.
- A Warehouse is Unnecessary.
Why should Bad Bob pay for warehouse space, when others will do it for him? Since most of Bad Bob’s income comes from service work, he doesn’t need to own a big warehouse that stocks complete doors. Bad Bob’s subs can pick up springs, openers, parts and replacement sections at any of several wholesale warehouses in his area.
That’s another reason why this scheme works best in large-population centers. There are always plenty of distribution centers and wholesalers who unwittingly cooperate with the scheme.
- A Storefront is Unnecessary.
A storefront might add a little credibility, but Bad Bob knows that it’s really unnecessary and way too expensive. Bad Bob often runs this entire scheme out of his own house, and his Yellow Pages ads usually don’t list a physical address.
As the ads generate hundreds of phone calls, Bad Bob just takes calls and collects money.
What if Bad Bob gets caught? No problem. He just takes his boatload of money and moves on to the next big city.