Current Material Prices

iceman61

I've been beating my head in the desk with every quote I do lately. Since shingle & felt prices are rising every 2 weeks, are you guys still estimating jobs the same as always or have you changed up? I typically "had" a 30 day price guarantee on my estimates, and then changed it to 2 weeks.

I have heard from suppliers that alot of the local contractors have been just quoting labor lately due to the rapidly changing prices, but this might as well be hear-say for all I know. It's frustrating the heck out of me knowing that I'm bidding on jobs that were bid by other contractors 2-3 months ago. (mostly insurance jobs) Those material prices have increased 6 times since then. How are you guys handling this right now?

Slyfox

I added a materials cost order change section.

The prices quoted for Materials are based on my suppliers current price list and is good through July 18, 2008. "Which was our last price hike here"

Ask your suppliers for thier exspected price increase time frames.

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Bill

I make sure I tell the HO the estimate is good for 30 days only. Then if I have to redo it, I charge them for it

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Ed the Roofer

I just did the same thing last week and listed the exact prices from the list.

If the material prices only go up less than 10%, I will absorb it, but if they go up 10% or more, then the excess plus taxes get charged to the customer.

Ed

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iceman61

Ed are you saying that you actually include the "material" $/SQ on the quote? That is how I was thinking about handling it. That way the customer would know that the materials cost had increased. I actually call the supplier every time I quote a job & have those prices written on my take-off sheet along with the date & next price increase date.

When I first started out, I would break out every little detail & list a price for each item. Now I just break out each item & give a lump sum price at the end of the quote. I do give price breakouts for add ons (ridge vent, Arch shingles vs. 3tab etc....)

I kinda find it hard to believe some of the contractors around here are actually giving out time & material bids. (according to one of the suppliers)

BattleRidge

I always put the materials and the labor down. Just because people always ask anyway/

Ed the Roofer

Yes, I now have a line in with the lowest prices that I have available to me from various suppliers listed.

"Material price allowances for each selection are as follows: Basic is $xx.00/square, Upgrade is $xx.00/square, Premium is $xx.00/ square, and Specialty Premium is $xx.00/square due to market price volatility and continuing rapid material price increases, costs may be subject to actual delivered prices plus tax and delivery charges. If less than a 10% material increase we will absorb the cost. "

Tell me what you think?

Ed

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johnk

Sounds good Ed,as long as you add 10% to your original proposal.

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iceman61

I guess maybe over the past few years I've been dropping a little too much detail out of my quotes.

Ed, that statement pretty much nails it down on all accounts. I may do something similar & add a line item about felt also. Seems felt has been going up once a week & has doubled lately.

Thanks for all the input guys. I've been reading this forum for a long time now, and it's guys like all of you sharing advise & knowledge that makes this forum a diamond mine to everyone.

Ed the Roofer

Everything I do is tear-offs.

Material costs historically average only 25 % of the total contract price.

25% Material
25% Labor
25% Overhead
25% Profit

That is not exact and each job may differ a bit, but those are close to the historical averages.

So, if material prices actually do go up 10%, that really only affects that current proposals price by about 2 1/2% in totality.

I don't want to discount my work for more than 2 1/2%, therefor, the material allowance clause. Maybe I should add in a line that whatever "PerCentage" the actual shingle material costs go up will be carried across the board in its entirety, to account for all of the other miscelaneous material costs as well.

With an allowance figure inserted and agreed to, especially with a percentage increas/decrease going across the board, which likely could be assumed for the proportionate labor amounts as well, then theoretically, the proposal would never be needed to be limited to a set time period.

Hey, I like what I just thought of.

Ed

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