Here is a tip for any rehabber who is paying retail for their materials. Whether you shop at Home Depot, Lowe’s or any other major hardware outlet, you can likely find programs that are reserved for “professionals.” These programs can save you thousands of dollars on a single rehab, and potentially tens of thousands of dollars per year if you do multiple flips.
As an example, if you shop at Home Depot for your materials, there is a program called the “Pro Bid Desk.”
The Pro Bid Desk is basically a program for those who walk into Home Depot ready to purchase $2500 or more in a single transaction. The store will take your purchase list, send it to the “Bid Desk” up at the corporate office, and within about 12 hours, you’ll get a “bid” on your purchase price. Basically, what this means is that Home Depot will offer you your entire purchase at a discount — generally 15-40% off retail! Obviously, they do this because their competitors (Lowes, for example) do the same thing, and they want to make sure you don’t take your volume business “across the street.”
I learned about the bid desk back when I was just starting out, and one of the guys at the Contractor Desk found out that I was buying $5000+ worth of merchandise a month; he laughed and suggested that I never pay retail again. He had me start bundling my orders into $2500 purchases or more, he’d send them to the Bid Desk and within 8-12 hours, he’d get me a massive discount.
As an example, last week I walked into Home Depot with a $1500 door and window order. To meet the $2500 minimum, I decided to add about $1000 worth of other materials I knew I’d use in the coming weeks (a case of door knobs, a case of deadbolt locks, fans, light fixtures, etc). My total order came to $2792, and Jim (my “guy”) told me he’d call me the next morning with the bid. The next morning, Jim called and told me that he could sell me that $2792 worth of merchandise for exactly $2139, a nearly 24% discount just for putting the order through the Bid Desk!
The next best part was that after I handed Jim my Home Depot credit card to pay for the order, I just walked out of the store. Jim had someone go to gather everything I bought (15 doors, 4 windows, and about 2 dozen boxes of other materials), and stored it away for my contractor to come pick up that afternoon. Not only did I save 24% on my purchase, but I saved about an hour of having to get all the stuff, take it to the register and figure out where to store it for my contractors.
For a typical rehab, you’ll likely spend about $5000 on materials. If you do four of those per year, and save 25% by using the bid desk, that’s $5000 per year extra in your pocket! And, for about $100/month, you can rent a storage unit and really buy materials in bulk — perhaps getting even more than 25% off in some cases.
And this doesn’t include the other special programs you’ll find out about after you’ve become a regular…