5 Tips to Estimate Your Construction Project from HoldRite
Although plenty of seasoned and experienced tradespeople are part of the industry, there aren't so many who can call themselves experts when it comes to estimating the costs of construction work. Being tasked to estimate your construction project is one of the most critical yet challenging elements of building any structure.
Once you figure out the costs of a project to the best of your ability, you'll then need to present it clearly to the client and make sure you stay within budget through to completion.
The professional estimators of the HoldRite VIP Estimation Services Team offer these 5 tips to be successful in estimating:
1. Know the Project
It might seem obvious, but without an in-depth understanding of the work required, there's no way to present an accurate cost estimate.
- Have a completed and approved set of plans – not merely a conceptual sketch or an informal discussion.
- Make sure the plans are seen and accepted by the client. This is the only way to know if you both agree with the work that needs to be done.
Along with reviewing the plans in advance of offering an estimate, it's also a good idea to visit the site whenever possible.
- Talk with other subcontractors regarding any particular circumstances or conditions that may add to the cost of the project.
- Ensure that all stakeholders are involved before presenting an estimate, so there are fewer surprises.
2. Reply Quickly to the Client
Contractors may have a competitive, well-researched, and accurate cost estimate, but it won't do any good if it takes weeks. Most clients expect you to estimate your construction project in just a few days. Aim for no more than five days to complete the work, and certainly never longer than 10 days.
To achieve this:
- Develop a good working relationship with subcontractors. If you have to wait for them to provide you quotes, your clients will not wait for you. This can cost you dearly. Talk with them about your expectations for timeliness before it's too late.
- Use unit costs to estimate. Some estimators will use stick estimating, which involves breaking out every section of a project. Instead of listing the various parts of the job, the hours to complete the work, all the materials that will be used, and more, try unit cost estimating. For this, you determine the line items for the job, the unit costs per line item, and then total your numbers.
3. Double-Check Your Work
It doesn't matter how many times you've estimated a construction project; you need to have a second set of eyes on your work. This can save you severe headaches – and potentially unmanageable financial mistakes.
Double-checking your work can mean:
- Reviewing the unit prices by using an estimating book. Be careful with these books, as they can be inaccurate, depending on your region. Do not rely solely on the modifications a publisher may send.
- Apply your markup. With adding in all the quotes from subs and material costs, you may forget to add your markup. By double-checking your work, you can confirm that your markup is appropriate and competitive.
- Validate with an expert. Since salespeople can't precisely ask their peers (competitors) to review their work, often they will work with experts like the HoldRite VIP Estimation Services Team. This service can either provide an initial estimate and allow you to serve as the second set of eyes, or they can offer an independent audit of your work. Either way, you'll know you're submitting a professional and accurate estimate.
4. Use Your Computer
You may be old-school when it comes to a strong work ethic and traditional training, but be modern when it comes to your estimates. Computer spreadsheets or even specialized software can help cut down on the time it takes to present the work to your client.
Computerized estimating involves:
- Staying organized by having all your work in one, centralized place. Many times you can even have your work saved "on the cloud" so that you can access your information from a tablet in the field or at the office or home of a client. There won't be any more missing papers.
- Accurate math. When you are estimating long-hand with a calculator, you're just asking for mistakes. Spreadsheets or specialized software can be programmed to do the math for you. You're also able to compare estimates with other, similar jobs so that you can quickly determine if something is missing. It may take time to learn the software or how to manage a spreadsheet, but it's worth it. Expert estimators like HoldRite VIP Estimation Services can help with this, too.
- Easy-To-Read Presentations. You have to give your client a final version of your estimate. Hand-written scribbles, even on pre-printed forms, doesn't look as professional as a printed version. Plus, you can email PDFs also to keep track of when you submitted the proposal.
5. Follow Up After the Project
Once you've submitted a successful estimate of your construction project and finish the work, circle back around to see how you did.
Tips for this include:
- Update your estimating book, if you used one. This entails comparing the costs listed in your book with your actual invoices. This is the only way to ensure that this resource is accurate for your next project.
- Discuss the success of the project with your team. Contractors are always busy, but it can save you time in the future if you review the work right when the project has ended. Besides checking the accuracy of your estimate, you can also look at any other key performance measures, or KPIs, that you use for your business. Are there ways to reduce costs and avoid duplication? Did you stay within your budget? This high-level leadership will help the bottom line of your business.