9 Common Steel Building Sales Traps [And How To Avoid Them]

Connor FieldingBlogLeave a Comment

Mousetrap

The metal building industry is full of slick sales pitches, deceptive gimmicks, and straight-up scams:

The deal of a lifetime is finally within your grasp, but you have to pull the trigger now. That rate disappears if you hang up the phone or don’t put a $15,000 deposit down to lock in your deal!

Will you receive a “bad” steel building from these companies?

Not always.

But they will rush you through the buying process, and there’s probably a reason they’re resorting to these misleading ploys and gimmicks to move their product.

Here’s a list of nine of the most common steel building sales traps. Afterward, we’ll discuss what you can do to protect yourself from them.

 


1. Overrun or Unclaimed Steel Buildings

Selling overrun or unclaimed buildings is one of the most common shady sales practices in the steel building industry.

Ninety-nine percent of the time, they’re not true, but a telemarketer or salesperson sure wants to convince you otherwise.

By some miracle, they just so happen to have steel buildings for sale that are perfect for you:

  • Close to the size you need
  • Compliant with local building codes (even though there are thousands of different codes, snow loads, and wind loads across the country)
  • Within your budget
  • In your chosen color (if you have a color choice)
  • Designed almost exactly as you imagined (i.e., storage building, steel barn, steel building kit)

Unfortunately, another company didn’t pay the balance on the building after putting down a deposit. The manufacturer is now desperate to get rid of this used metal building, even if it means listing a $20,000 building for $15,000.

They’ll try to convince you that the discount is so appealing that it’ll be gone in the next 24 or 48 hours.

Except that the original customer is likely as real as this bargain (not).


2. 10–50% Off Sale

A 10–50% sale on a steel building could literally save you four or five digits on your total cost … if it were an honest offer.

These “special sales” are the steel building industry’s equivalent of Black Friday “deals” or Red Tag sales events at car dealerships. They use the word “sale” to rope you into thinking you’re securing a once-in-a-lifetime deal.

Here’s how it works:

The manufacturer will significantly inflate the typical resale price of their metal building. They’ll then slash that price by 10%, 20%, or even 50%, bringing the total cost back to their everyday levels.

It’s a numbers game; who wouldn’t jump on a chance to spend $20/sq. ft. compared to $40? But if you compared this “sales price” to normal selling prices from other companies, you’d see many of them are similar or a lot less.

Again, this doesn’t necessarily mean you’re getting a lousy steel building, but it is a deceptive sales practice, and you’re not saving as much as you think.


3. Free Freight

“Free freight” is yet another tactic steel building companies use to blaze through the sales process.

Supposedly, if you order by a certain date (typically within a day or two), the steel building manufacturer will deliver the building to your site for FREE.

Who doesn’t love free shipping? Especially when delivery alone could add another 5–10% to the total cost of the building.

Unfortunately, the free freight offer is just to sway you away from price shopping. We’d say that 99 out of 100 times, you can get the same deal from another supplier for the same or even less money.

Hint: The freight isn’t really free.

The line item on the freight contract will certainly say “free” or “$0.00,” but the supplier is simply adding the freight cost to the upfront cost of the building and calling it “free.”


4. “Prices Are Going Up”

Inflation and rising material costs impact nearly every industry. That’s why the “buy now because steel building prices are going up” ploy is extremely convincing to unsuspecting customers buying prefabricated steel buildings.

But it might not always be a gimmick.

Here’s the truth of the matter:

Steel is a commodity. As a result, the price of steel can actually increase several times per month, and prices can surge as high as 200–300% in a single year.

This trap is a tough one to decipher because sometimes, steel prices are on the rise, while other times, they’re relatively steady.

More often than not, however, this is a trick to get you to commit to a sale without doing much comparison shopping.


5. Factory Rebates

Some brokers will tell you that they’re one of the only companies that receive rebates from the factory.

The most common (and somewhat believable) explanation is that their rebates depend on how much steel they sell during the year or within a given time frame. Or, they might schmooze you by claiming their rebate depends on putting together several building sales to turn in at once.

That sounds like a car dealership, doesn’t it? The second you walk off the lot, the deal is off the table.

Here’s the thing:

At no point has this industry ever given kickbacks or rebates for a certain number of building sales. Really, that just doesn’t happen.

The “logic” behind this tactic is to convince you to pull the trigger now before shopping with other companies to guarantee they get this supposed “rebate.” That’s exactly why they slap a tight deadline on the deal before it disappears.


6. Unusually Small Deposits

Deposits aren’t anything out of the ordinary when buying pre-engineered steel buildings. Manufacturers use these down payments to lock you in at an agreed-upon sales price and save themselves money if you bow out later.

Yet, unusually small deposits should raise a red flag.

A custom-designed steel garage, carport, or manufacturing plant can be yours for just $1,000 today!

Unfortunately, your odds of ever receiving that exact building are devastatingly low.

The process will be full of hiccups and delays. They’ll request repeated changes to the original drawings, blame the drawn-out lead time on low steel supplies, or always promise the project will begin next week or month.

But it won’t.

The scheme here was for a dishonest salesperson to walk off with your deposit without ever producing a building.


7. Any and All High-Pressure Sales Pitches

Salesman on phone with evil look on face

If you’ve ever had the honor of speaking with a telemarketer, you know about the ridiculous lengths they’ll go to scam or under-deliver.

Yes, these scammers plague the prefab building industry, too! They dial up the sales pressure to persuade (or rather, manipulate) you to put down a deposit or sign a contract.

The thing is, this never-before-seen deal expires at 5 P.M., midnight, or when you hang up the phone.

It’s pure deception.

The only reason they “need” you to commit today is that they probably wouldn’t be your first choice otherwise. If you had more time to decide, you might see their sea of one-star Yelp reviews or realize that supposedly “low” price isn’t all that low.


8. A Relatively Unknown Company

New metal building companies pop up every day, but not all of them are honest companies (or legitimate companies at all).

A random telemarketer cold-calling you to pitch an equipment storage facility or a 100″ x 100″ horse barn should sound the alarms.

But these deceptive suppliers also go to extreme measures to build a convincing facade (i.e., printing business cards or setting up a website).

To verify their legitimacy, look for contact information, business records, and non-phony reviews online. If all of the reviews on Yelp or Google my business have five stars and raving testimonials, it might be too good to be true.

The age of the business matters, too.

You might know of a supplier that opened six months or a year ago and has done some projects in your city. But can you really count on a brand-new company to honor a lifetime or 40-year warranty?


9. Uninformed “Quotes”

The final “trap” is one that only the most gullible fall for — uninformed quotes or ballpark figures for a building project.

Sales reps may very well lack integrity and an aligned moral compass. But they’re also smart enough to listen for your needs and deal-breakers during your conversation with them — so much so that they’ll toss out a ballpark figure or quote that’s miraculously within your budget.

The only problem is that this is almost impossible to do in such a short chat, especially for custom builds.

Size, materials, weather resistance, and insulation, (among other factors) will all influence the cost of your build. Everything you add or remove from a custom steel building will change the price tag!

If the salesperson doesn’t mention the gauge of steel or a price bump for spray foam insulation, it’s most likely a gimmick.

Not to mention the obvious:

Consider it a spike-filled trap when the salesperson won’t — or can’t — answer legitimate questions about your project or steel buildings in general.

They don’t know about galvalume PBR panels or walk doors?

Probably not the project partner for you.


How to Avoid These Steel Building Sales Traps

Woman on phone with a skeptical look on her face

Now that you’re on high alert, how do you avoid falling victim to these common traps?

Here are seven tips that will help you protect your money:

Research Local Companies

Even if you’ve heard incredible things about one particular company, keep your options open. While some manufacturers specialize in arch buildings or metal sheds, others thrive in the commercial sector.

Visit their website to check for:

  • A single company name
  • A physical address that’s not a P.O. box
  • A local phone number (that doesn’t go straight to voicemail)
  • An official-looking email address (i.e., sales@smithsteelbuildings.com, not steelbuildings4sale@yahoo.com)

Cross-check these details on Google as well. A good company doesn’t change its phone number, address, business name, or email address regularly.

You can also verify that they have a legitimate business license and are in good standing by checking your state’s business database.

Vet the Company’s Reputation

When in doubt, check Google, Yelp, or Yellow Pages for online reviews about the company. But pay special attention to the three-star reviews.

One-star reviews will likely be from customers who felt scorned by their experience or held the company to overwhelmingly high expectations. Five-star feedback comes from those blown away by the service or blatantly asked to leave a positive review.

Those that leave three-star reviews tend to be more honest and describe a more realistic experience. They’re the ones that will tell you both the good and the bad.

If the first results on Google are former customers complaining about being ripped off, there’s your answer.

Learn About the Price of Steel

Steel prices can dip and surge unexpectedly, having a direct impact on metal building prices. If a manufacturer tells you that steel prices are on an upward swing, verify these claims by checking the latest trends.

Keep in mind that steel prices can fluctuate significantly from year to year. For example, prices went up 215% between March 2020 and July 2021.

The concept of “locking in” rates based on the current steel price isn’t deceptive, either. But, these agreements typically expire after 90 days, not after a day or a week.

Reject Any “Bargains” Following High Sales Pressure

An honest, reliable company won’t force you to put down a five-figure deposit or sign a contract within 24–48 hours.

In fact, an ethical manufacturer would recommend you shop around and weigh your options before committing.

Compare Prices and Timelines With Other Companies

Any time a manufacturer or broker plasters their website with their ultra-fast lead time or half-off sales, there’s likely a catch. So, take the time to compare their prices and timelines against their competitors.

Are they promising to erect a 200,000 sq. ft. building in a week or at half the cost of other companies? If so, they’re either cutting corners, planning to “unexpectedly” increase these later on, or being deceitful.

Work With a Manufacturer Instead of a Broker

The problem with working with steel building brokers is that it brings a middleman into the mix. You communicate with them and they interact with the supplier, but there’s a permanent wall between you and the supplier.

Suppliers will cover missing or defective pieces, while a broker will not.

Listen for These Keywords

Once you know the long-cons in the steel building industry, you’ll be able to detect these schemes before you fall victim to them.

Words like “unclaimed,” “canceled,” “offer expires,” “clearance,” and “rebate” should be a clue that something is bound to go wrong.

Planning a commercial construction project in Colorado? Read our article about Colorado construction loans to learn how to secure funding for your project.

Bottom Line

Steel buildings are the backbone of several industries, but the last thing you want is to lose a deposit or fall into one of these common sales traps.

So if you’re planning a construction project, learn how to spot and avoid them. Learn what to look for in legitimate companies, too, and you’ll find the right contractor in no time.

Speaking of which …

If you’re looking for a steel building contractor in the Colorado area, FMP Construction might be the company for you. Get in touch today, and we’ll see if we can help with your project.

Leave a Reply

Your email address will not be published.