Time To Create An Estimate

Kevin75

Hi folks! I do estimating (and everything else that is asked of me!) as a partner in a remodeling company. I'm curious to hear how long other people spend on creating estimates for additions. I do tedious, item-by-item estimates using National Estimator software, due to the fact that we're a newer company (two years) and I'm therefore less experienced than some estimators. I just wonder what amount of time is reasonable to spend on an estimate for a project.

My understanding is that there are various estimating methods:

1) WAG - Wild @$$ guess - this doesn't seem like a good idea to me

1 a) Educated WAG
2) Stick estimating - counting everything stick by stick (I tend towards this)
3) Square Ft estimating - I don't understand how this would work since customers have such wild variations in what they're asking for.

I'm curious to hear your thoughts! Also...any tips for reducing time on estimates other than experience and redundancy?
Thanks.

Kevin

fci

I've been down this road before and it isn't easy. What works for me on every project is unitizing everything. Whether you measure it by weight, square feet, linear feet, quanity, etc. it can be unitized. Once you have a system in place it works extremely well. Eventually projects will start to repeat themselves in some fashion. I haven't heard of anyone that uses stick pricing anymore in remodeling. Good luck.

rbsremodeling

I use hometech to do my preliminary estimates. I have modified the cost database and mark ups to suit my company. I can do an addtion estimate anysize, shape in about an hour. I then review it and edit for another hour.

About 2 hours on an addition estimate


If they accept the preliminary estimate. I spend 2-3 hours on specs, selections, and reworking the preliminary estimate into final bid.

Usually takes 8-10 hours of work from start to finish for a final bid.

Like fci says it starts to repeat itself so you copy old estimate and add the new or different items or selections.

Craftsmans software has to be the slowest of all the estimating programs on the market. Every line item is cut and paste, versus having assemblies that you fill in the sqft etc.

I have assemblies or templates for kitchens, baths, basements, additions and whole house remodels in my program so 80% of the estimate is done in about 20 mins

Give hometech or bid4build software a try. Both really good at the templates assemblies. If you spend maybe 2 weeks modifying their databases you will cut your estimating time down significantly.

Bid4build has alot more features that hometech does. Hometech is strickly for estimating cost. I may seem overwhelming but if you take your time it really is worth the time in my opinion.

__________________

silvertree

Bids from subs and unit pricing.
Get the lumberyard to do your material takeoffs. I use a computer.

RobertCDF

Unit based pricing... Start putting it together it takes a lot of time but its worth it. Just dont forget to include stuff. EX. For me I have line items for QTY of: piers, posts, joist, etc, etc. LF: beams, rails, stair rails, etc, etc. SQFT: decking, roofing, etc, etc. Included in piers would be a column for Materials and a column for labor. Material would include: Disposal of dirt, concrete, sonotube, rebar, j-bolt. Labor column would include the labor to dig, dispose, set rebar, mix and pour concrete and set j-bolt. So now I just enter QTY of piers and it covers all those costs.

__________________
Robert Shaw
Colorado Springs Custom Decks
Colorado Custom Decks
Custom Composite Decks

wackman

I read a biography on Henry Ford. He got tired of adding up all his invoices for figuring income so he came up with a easily repeatable system (his real talent).

He took a stack of invoices, random invoices with different dollar amounts, that he'd just done (so he knew the figures and how many there were) and he put them on a scale. After that he figured out the weight-to-dollar average and that's how he did it from then till he got accountants.

They thought he was crazy when he showed it to them but it was surprising close to being accurate!

Stone Mountain

I do the "stick by stick" method. I add up every picket, board, and screw. Oddly, I then put a sq/ft labour price to it, with a fudge factor depending on the complexity of the job. Seems to work.


When my brother and I were partners 15 years ago in the same business, he used to sort of sight down his thumb, wave it around a bit, and come up with a number. 95% of the time it was within $100 of my "stick by stick" price. He'd do it in 30 seconds, I'd take 20 minutes. To this day, I still do it my way, and he still does it his way. He's now a custom house builder, worth a few million bucks, and is currently building 50 townhomes. When he estimated his costs, he did it by his "rule of thumb", and came out within 3% of what the project actually cost!!
I guess we now know which way you should go to make money.

__________________
Residential Deck Specialist: Vist our Website
www.fenceanddeck.ca

wackman

Makes me want to throw out all my spread sheets.

ApgarNJ

i do not use estimating software because it would never work for me based on where i live. it's too broad.
i do a rough sq ft measurement based on past projects of the same complexity and then i do it by taking all the subs prices, all the material, and my labor how many months or weeks whatever it takes to do the job. then add 15-20% profit to that. and also mark up the subs a little too because they sometimes have little extras that they charge you for and can't always go back and charge the customer.

i find this way works. sometimes i find tha ti'm below my sq ft price and so i add a little bit more, better to make money than to get burnt out. especially on the larger jobs

i can see where estimator software would work for some trades but i still like knowing exactly what my costs will be. not some computer telling me what i should charge. based on national costs

Grumpy

If you are new to somethign you should do, as you called, stick estimating. it's a pain in the ass, and it takes a long time but it is the only accurate way. INfact at first I recommend using your stick and square foot method and going with wich ever is higher.

After you've got a few under your belt you can lean more towards the square footage, but before you can do that you have to know all of your costs especially production turn around. How long will it take you to get done? Then adjust your square footage price accordingly.

True square footage wouldn't work for everything. The customizations make each job unique. But you could get a square footage on the shell, then set allowances for fixtures and customizations.

For my estimators, I have price lists based on square footages. The price lists summarize and iincorporate all the standard features, and then there are some common upgrades on the lists as well. However I tell all my guys that the price lists are for average jobs only. If a job is not average the price list must be thrown out the window. Put it this way, if the job is huge and we use our price list... our bid willl be outrageously high. If a job is small and we use our price list we will make no profit on the job. I have an excell spreadsheet I use for pricing down to the last nail, this is what I use for large jobs. This is what I use when my estimators accidentially undersell a job, just to make sure we can bring it in on budget before I cancel the sale. The spreadsheet hasn't failed me yet.

Kevin75

Well...I'm getting a bit quicker. I appreciate the help.

Kevin

CWCinNJ

The only thing that works and is 100% reliable is the "stick by stick" method , imo. Every project varies. I have a template I have developed over the years that aids the process and won't allow me to overlook items. It is a tedious process at times but the resulting reasonable and profitably priced project is the reward. I also become far more knowledgable of every facet of the renovation once the process is complete. Q and A sessions upon presentation of my proposal go smoothly. I am certain that my numbers are fair, my confidence soars at closing.
An extremely important point to be made here is do not delay. At initial consultation closing, I schedule the next sales meeting within 3-5 days.
where I present my proposal and pricing in detail.

CWCinNJ

I forgot to add that it generally takes between 6-8 hrs. to price a medium to large renovation/addition.

Jkountz

Are you talking about the software you buy or the online subscription based service??

rbsremodeling

I have hometech software and I also have a subscription to the book which has the identical data I bought a 5 year plan 4 years ago. The online software to me is difficult to navigate. I would buy the book before the online software. I think the software is worth the money if you can afford it for new or contractors that cannot estimate. Or if you need a ballpark estimate to give a homeowner

__________________

Jkountz

The biggest trouble I found with most estimating software is that in the end you still have to determine how long it will take YOUR company to do the job, not the national average. I have found that just because two men can do job X in 10 hours does not mean 4 men can do it in 5. It just never seems to work that way for me, its too broad. I am currently looking for a better solution but until then I just base my total man hours on past experience and go from there. Slow but effective I guess.

rbsremodeling

One thing I give hometech credit for is that they tell you their hours are based on a system of x. If you use the system and their estimating progam based on x it works. If you don't then it does not work. But they tell you up front what their estimating system is based on and I have tried it and it is very close if you use their system.

Obvisoulsy i agree with their system so i use it for the most part but when i can't or don't i adjust the number based on what i have to do

__________________

silvertree

In regards to how efficient 1 or 2 or more guys are. I read something that makes sense to me.
1 person is 100 efficient.
2 people on the same job become less efficient and the more people the worse it gets. Another reason good estimating is a science.

__________________
Vote for Pedro
Kitchen, bath, St Paul remodeling
Minneapolis Remodel Blog
203K Loan Consultant Minnesota

Jkountz

Boy aint that the truth! A great example of this is say you're doing a siding job and you figure that with three guys on it they can finish the job in 4 days. Meanwhile I have another employee who just finished another job on another site so I bring him over to help the original three men.
Still took 4 days!!
Arrrgghhhhhhhhh!!!!

wackman

In construction I agree mostly, but in other things multiple workers can be MORE efficient than the same number of workers working independently.

A good example is an assembly line for just about any product. Take a rifle. 10 people could build 20 of them an hour if each just does that one thing over and over, where as if each one was building the whole weapon themselves they might only assemble 10 an hour.

Ya know?

If we could find more ways to build systems (E-myth) and adopt more of that style of thinking and working I bet we could get much more productivity out of our guys.