This episode captures a live contractor negotiation breakdown when a $100K “hard quote” became uncertain after the contractor walked the Louisiana property again and requested clearing work before committing to final value-add pricing.
Key Takeaways:
- Hard Quotes Aren’t Always Hard A contractor who initially quoted $100K total pivoted to requesting $35K for clearing alone before providing final pricing on remaining work, forcing real-time decisions on whether to hold firm or accept changed terms.
- Backup Options Create Negotiating Power Maintaining a $125K backup quote (with mid-May start date) provided leverage to push the original contractor for clarity on whether the $35K was incremental or part of the original $100K agreement.
- Timeline Compression Brings Surprises Parish approval arriving in one week instead of four to six weeks exposed that vegetation density was more problematic than originally assessed, demonstrating why ground-truth visits after survey staking are critical.
Listen to hear the real-time decision framework for salvaging contractor relationships while protecting deal economics in volatile project conditions.
(Podcast transcript below)
Hi, Chris Duff over at Serious Land Capital, vacant land funding partner. I was just getting off a webinar with Callan’s AI bootcamp, tremendous setup that she’s got going on with that uncommon business. She started a big fan of Callan and spent a lot of time in person and not surprised at all the success she’s been finding.
with orienting her career more towards the AI coaching side of things. we just obviously see the value in what’s being offered and so signed up for that automate to accelerate. Hope to see some of you inside of that. That investment should pay off in spades even over a matter of weeks. So just find myself routinely frazzled.
on a daily and often weekly basis, just trying to balance so many different elements of our business and multiple businesses at this point. Like, yeah, I just need to be able to automate or at least build more systems in place to delegate more effectively so can continue to grow. So very excited about that. I’m sure we’ll be able to report on a lot of our progress as we roll that out.
in addition to the daily adjustments we make on our own business from an AI side. A number of updates that we’re using AI for on the land priser side too. That’ll be another discussion. Got a whole bunch of that work done earlier today. And then also wanted to update what I think is going to be most relevant in terms of further negotiation tactics. So I know I reported within the past few days.
We had a lot of back and forth with different dirt work contractors for that larger Louisiana minor subdivide, roughly half million dollar purchase that we’re deep within. And I had mentioned, we had all this back and forth and different quotes coming in and we had a hard quote for a hundred K.
Uh, for, uh, you know, doing the full clearing and driveway installation, um, for all three of the child parcels that we are working on. Um, so, uh, you know, over the Easter weekend, my, uh, uh, realtor was saying, yeah, I’m going to be drafting up the anticipated, uh, uh, terms, um, get everything in writing here by, you know, today, this Tuesday, April 22nd.
and so I was following it up with him today. And so my realtor was out with that contractor again for a couple hours, just walking the property this morning. And the contractor was indicating, Hey, like we really need to clear out a lot more vegetation here. So I can like better understand the full setup of what is required, from the value add work and.
specifically two of the child parcels, like it’s just really densely, you know, packed with, with vegetation. so, you know, it might just be some additional complexity in terms of what’s going to be required from a value add and work standpoint. though my understanding was this was all accomplished prior to getting that hard quote. Like, so
Anyway, the contractors coming back. Yeah, like instead of doing a half down deposit, I’d rather you you saying, okay, let me do the 35 K 35 K to clear out all three of the parcels and then we can get under contract for the actual value add work and
I was a bit taken aback by this and so was my realtor from this because now it seems like that 100k quote wasn’t actually hard. this is kind of foot in my mouth for me because I already reported to my investors within the deal, hey, we landed 100k quote, we’re below budget, we’re expecting to get rolling on this in roughly a week or so. And now I might need to go back and say, no, it’s actually going to be more expensive, the contractor.
you know, kind of bailed on what he was saying was a hard quote and the realtor was having, it just seemed like a different tenor of a conversation when he was out there meeting with this guy again today. so, you know, I, I was, you know, kind of putting my foot down a bit more. like,
Well, this is still unclear to me. Like, is this guy asking for 35K and then 100K on top of that? I guess a huge change from what we had agreed on, what was perceived to be a hard quote as of last week. Or is that 35K still a part of that 100K deal that we had arranged on? So I told the realtor, hey, like, this guy gave a hard quote last week.
So say that we’re ready to put that 35K down so long as within the terms of the written agreement that the total cost of the project is going to be at most 100K. And then we’re willing to sign. So I’m still waiting to hear back from that at the moment. then I also, know, a lot of this negotiation, I kind of come up with on the fly. Some scenarios are similar to those in the past. Some are newer.
And you know, you kind of got to just pause and think through okay What’s like best process to do here and still remain in the driver’s seat, you know damage control as needed Or again, we have that backup quote hard quote for 125 K But they’re only going to be able to start in mid-may and so then we can always go back to that guy and just say like You you reneged on your deal here. So we’re just gonna go with with somebody else. So
We’re still in a power position in terms of, you know, we can get this done by somebody else. And, know, it was still an agreeable price. It’s still like right at the budget number that I was expecting, you know, roughly 125 K from the start with this. We, you know, have 137 K to work with in terms of cash within the account, you know, keep like roughly a thousand if needed.
for property taxes if it’s a little bit of a longer hold. And luckily it’s ag land, so the holding costs are very cheap. But that is what I would be orienting around. So I’m having the realtor go back, have that conversation with his contractor, hopefully know more shortly. But this is just kind of sharing live, these things happen, right? You get thrown curve balls.
And how do you adjust kind of in the moment and make the requisite decisions to figure out, okay, what’s the best way to salvage this situation? know, no money is out of the door yet. Nothing is written. No deposits are out. So we still have, you know, the freedom of choice here to opt for the direction that we want to go in being mindful that like, you know, time is of the essence here. So
need to make a call, get this work started here, a SAP. Plus this contractor was saying, you know, just 35 K for the clearing work was going to take like two weeks by itself. So now all of sudden, like this is longer, seems like a longer project. understanding initially was pretty much everything could be accomplished within a week, roughly. So this might be a trickier, a trickier project from a timeline perspective than
estimated. So trying to figure that out as well.
No surprise when you’re getting on the ground work done, costs can change, timelines can change. So just trying to keep that optionality open. Hopefully this is helpful for you as you might navigate similar conversations or just be even more fleet footed for potentialities like this in your own business here. And I will keep you all updated as more info comes up.
With that, if you are seeking funding for your land deals, Serious Land Capital, any land deals that you want reviewed, zero cost to you, check out Land Daily Diligence Facebook group. I’m going to be going live there again in a couple days. And then LandPricer.ai for the most simple and accurate way to price land. Again, I’ll have more reports on our exact
tech progress that we’ve been doing. Putting so much effort into that. Very excited to deliver it to you all. Please write in review. If you haven’t already, it’s taking literally two seconds to hit the review site on Spotify for the stars. They don’t even ask you to write anything.
That would be really helpful if you wouldn’t mind doing that or hitting the like button, YouTube, you’re listening to this to subscribe and share. I will see you all next time. Take care. Bye.
