ᐅ How much savings on building materials can effectively serve as near-wholesale equity?

Created on: 11 Feb 2022 00:07
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Johnny82
Hello forum,

we are currently gathering information about building a house.

Today I learned something about employee conditions:
I recently started working for a company that, among other things, also deals a lot with building materials, and I can get the materials at the wholesale cost + x% + VAT.
I am not involved with the building materials department, but I share an office with two ladies from that department. Today I asked one of them how it would work if I wanted to build a house, etc.
She said that it’s not a problem for the tradespeople if you supply the materials yourself. It’s basically the exact same materials from the same source, and it probably reduces coordination efforts for the tradesperson. She also said something like, “I’ll handle teaching them if needed!”
So let’s just take that as a fact for now.

My mother works in the Black Forest region for a landscaping company that belongs to a construction company which also builds single-family homes. Their structural construction manager estimated around 600,000 euros for a turnkey house with 140-160 sqm (1500-1700 sq ft) of living space.
We’re currently using this figure as a rough benchmark.

On the landscaping side, materials are charged to the customer with an XX% markup. Let’s assume the structural construction company applies a similar markup and that this is standard in the market.

I am aware of the values for X% and XX%. (I don’t want to sound mysterious; it’s just to avoid a situation where a tradesperson shows up at my colleagues’ work tomorrow saying, “You sell your employees materials at XX% less than what you charge me!” and causes a fuss. Some of you might be able to guess which company I work for.)

What materials are available through my employer:
Everything for the shell construction, windows, doors, flooring, insulation, paints, plaster, gypsum, stairs, bathroom fixtures, everything for interior roof finishing, etc.

I’m not sure if we have the following:
Plumbing materials (pipes for water supply, heating, etc.), electrical installation materials, heating systems/heat pumps.
BUT: We have a building services installation team (three-digit number of employees, so a large team) covering heating/water/air/electricity (including photovoltaics), so this kind of equipment should be available to order.

What we don’t have:
Wood (e.g., beams) for the roof frame itself and “decorative” wood—meaning not the aesthetically visible wood, but only things like battens and similar.

So, long story short, here is my question:
Is there a factor or rule of thumb to estimate how much cheaper the 600,000 euro house would be if I got the materials basically at wholesale cost plus x% plus VAT?

Or maybe something like: If the house costs 600,000 euros, the shell costs 100,000 euros, and of that 30% is material costs? Something along those lines?
And similarly for other trades.

And one more question, even though it might be a bit early for this:
What might be roughly saved if you did the following work yourself:
Painting inside and outside
Laying flooring yourself in the bedroom, three children’s rooms, hallway on the first floor and second floor, basement (so more the “non-public” areas)
Roof interior finishing
My brother-in-law is a master painter and also does external insulation and possibly plastering; he would probably be available at a reduced rate.

I know a lot of “ifs” and “buts,” but rough estimates would be helpful for now.

If we were building in the Black Forest, I would:
Not have the employee purchasing conditions
Only have one brother-in-law with limited skills nearby
But have a friend who could possibly handle the electrical work
And an acquaintance for gas, water, and pool technology
Possibly, the landscaping could be cheaper through my mother’s colleagues

Due to the distance, my own work would probably be limited to painting inside and laying floors in areas where they are not urgently needed (so manageable), and eventually doing the roof interior finishing. Basically a fully turnkey project otherwise.

I’m trying to convert these differences into a monetary amount or at least get a feel for it.

Thanks for your insights!
H
henning181
12 Feb 2022 18:27
Hello everyone,

During the complete renovation of our 200m2 (2,150 sq ft) house in Hannover, I also asked if I could provide the materials. The answer was always yes, but with the note that the warranty would then be only limited. We decided not to do it. You have to keep in mind that if you supply the materials, they also need to be available on site, otherwise you will encounter additional problems. And don’t forget, at the moment, contractors have no incentive to discuss materials (costs) with you. They will simply pass the work on to the next person...

Best regards
M
Martial.white
12 Feb 2022 18:39
You will probably save nothing and won’t find a tradesperson.
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HansDampf88
12 Feb 2022 19:47
driver55 schrieb:

The headline should rather be, "A Swabian building in the Black Forest." 😀
Seriously though, only you know the x and xx, and I doubt the craftsmen will be just pure service providers.
(Are you also bringing the oil for the oil change to the workshop? Those guys really exist.)

I am one of them. Why should I pay 30 euros for a liter of engine oil? I just don’t see the point...

On the topic: Our bricklayer wants us to order the materials. According to the architect, this saves a significant margin that the general contractor usually includes in their pricing. I think it depends on the specific trade and the individual company. You can’t really generalize.
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Haussuche85
12 Feb 2022 19:52
Hello Johnny82,

try searching for taxable benefits.
11ant12 Feb 2022 22:57
HansDampf88 schrieb:

Our mason wants us to order the materials.

This makes me suspect that someone in the supply chain doesn't want to leave any trace that could allow calculations of their service revenue...
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
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HansDampf88
12 Feb 2022 23:03
11ant schrieb:

That makes me suspect that someone in the trade doesn’t want to leave any traces that could allow projections of their service revenue...

That could very well be one reason.
But there are certainly other reasons for self-employed people who have no “administration” at all… no administrative effort (traveling, phone calls, placing orders, checking invoices, paying bills), no tied-up capital… just go to the site, lay bricks, and then go home, leaving all the other tasks to the client… After all, there are only 24 hours in a day.