Quoting and estimating is one of the most important aspects of the job and can be one of the most difficult things you need to master as a successful contractor. If you get it wrong it can end up being quite painful, either you are consistently missing out on jobs as you are not competitive enough or else you get burnt for your own cash if you undercook the bid. Getting it right is essential to sustaining and growing your business.
Here we have listed a couple of best practices when bidding on a project to help you stand out and also ensure that you submit an award-winning bid. Whether it's for a contractor you have worked with for 20 years or a brand new lead, here are 5 things you should consider when putting together an estimate.
1. Tell the contractor you're quoting for the job.
It's an incredibly simple but effective step you can take to stand out in the mind of contractors. When you receive a set of plans to bid from a Contract Administrator, Project Manager or Contractor simply replay with something along the lines of -
“Thanks for the plans, I’ll be looking at them this weekend and I expect to have a bid back to you by mid next week”
There are a couple of benefits to this, firstly you let the contractor know you are quoting so they won’t award the job to someone else without reviewing your bid. If there is an update with the plans you will be first to know about it and it's just good to establish a line of communication.
2. Understand what you are being asked to bid on.
Whether or not a scope of works has been provided it’s up to you to go into the plans and ensure you are happy with the job and what you are being asked to bid. Go over all the aspects of the project that relate to your business and jot down any questions or clarifications you may have. Sometimes plans can contradict themselves so it's always good to be able to ask for those clarifications in one concise email. This again will show professionalism and real intent.
3. Doing your material takeoff.
Whether you are printing plans or using a software to do your takeoff, this will make or break your bid. By using ConX Measure you will be able to upload any set of plans you have and do your takeoff in a fraction of the time it usually takes.
By using the tools available you will be able to produce a great bid.
By going into the plan and understanding all of the aspects of it it will give you a greater understanding of all it entails and how to price it. That way there will be no ugly surprises when you turn up on site.
4. Have your pricing up to date.
When you have been in the game for a few years you should have a pretty good database on your material costs. It's important to keep this up to date so you can remain competitive but equally not get burnt on cost.
Your labour cost is the next thing you need to account for. This is another benefit of going over the plans yourself and seeing what exactly the job entails. For example, there is restricted access to a site and you need to organise machinery in order to complete the job, that needs to be accounted for in your bid. Or a sloping site will add complexity and you will know how long it will take your team and can apply your rate based on the variables.
5. Submitting your Bid.
There are three things we recommended sending across when submitting a bid.
- A cover letter
- The bid
- Marked up plans
In your cover letter have your inclusions, exclusions and assumptions. The exclusions and assumptions are the most important part of this. That way it is very clear what's been allowed and the builder can ask you to review if necessary but at least this way there can be no grey area when it comes time to start the job.
The bid itself. If you want to include line items it's a good idea so the contractor can be satisfied with what's been quoted in the bid.
And finally, if you have been using software you should be able to submit the marked-up PDFs. This will give context to the documents you have provided and will make you stand out from the crowd.
By following these steps you are going to make the contractor's life a lot easier by being a standout candidate. We have seen it time and again, jobs being awarded to a guy who has put in a higher bid but with a systematic and professional bid. It is worth the extra money to know you are working with someone who understands the job and can get it done as stated.
