I have made the statement that companies that try to price their work by the Square will one day go broke.
No one has proven me wrong to date. This is a horrible way to price your work for so many reasons.
First, the square foot of a project often times has little to do with most of the key factors.
Lighting package, gear package, location of the service, electric heat or gas heat, what is included in the site and the list goes on and on. You also don’t have a material list to work with and no way to actually track the project. For example: A hospital will cost more than a warehouse.
With that being said something that is very valuable is Historical data. If you are an estimator or contractor, in your work life can you imagine how many jobs you will price?
There are certain factors that will always be changing the game such as when LED lighting arrived along with lighting controls etc. but having the correct historical data from your entire past project will give you a great advantage.
It is a great idea to start recording this information ASAP.
These are the things that I recommend but you may create your own list.
Create an Excel spread sheet and list the following.
- Job Name –Example: McDonalds.
- Type of job-Fast Food Restaurant.
- Date of work-1-1-2019.
- Length of project.
- Contractor-Lincoln Contractors. You will find some contractors are better to work for and can make a huge difference in the outcome of the project.
- Distance from your shop. Was there travel involved-Hotel-Per Diem.
- Project Manager.
- Weather conditions-Did this have any effect on the project.
- Quoted price of project.
- Cost of project.
- Man-Hours quoted.
- Man-Hours to complete.
- Material Quoted.
- Material to complete.
- Lighting quote.
- Gear Quote.
- Fire Alarm quote.
- Square footage of project.
- Did we win or lose the bid.
- Who was low and at what price.
With this information collected you have a great picture of the job.
Sometimes you can learn the following:
- We don’t need to work for this contractor.
- We don’t need to work in this town.
- That Project Manager is not suited for this small of project or this large of project.
- We do really well at this type of project or we do poorly at this type of project.
- We are wasting our time bidding if XXX is bidding.
Also the next time you bid a project like one that is on your list you can match the criteria in your historical date.
For example: The next McDonalds you bid you can check your new estimate against your historical data.
If the man-hours are half or double you most likely need to check your new estimate.
If the square foot price was $18.00 and the new estimate was $36, 00 you can review your historical data to determine why. Was the lighting more, have material or wages gone up, you will at least have a guide to go by.
As an estimator in business I have been constantly asked for a budget price of a building, to keep from wasting time I can look at my historical data and get an idea of a budget price. You may need to add percentages to the original price for time gone by but is keeps you from spending time doing a quick quote.
Over the years this information will help you see what works and what doesn’t. Also it will help you see which crews are efficient and which aren’t.
This will also give you clear direction on which jobs you perform better at so you can zero in on your niche.
Historical Data will help you or your company so start collecting ASAP.