Novice Bidder Where To Begin?

Simon

Gentlemen,
I am what you call a novice contractor...that is I've remodeled houses for a couple of years, but never bid on contracts. I bought the house, remodeled and sold it. Not a bad gig, but now I'm looking at a remodel for a store front and the would-be customer would like me to make a bid on the project. All right money! But then I realize I don't really know where to begin. I've got the skills and the license but not the experience, ya know? Has anyone any advice or better yet an iron clad system for bidding? Tricks on cost estimates? A sure fire way to not screw the customer (he might come back) and not get screwed myself? I'm all ears and want to learn from other people's mistakes instead of my own (I've done enough of those I think). Thanks

Glasshousebltr

Simon, if your just getting into retail. my first advice is RUN!

Second advice, remod is the tuff, the worst to bid, make sure you have your contract itemized well, a bunch of little sticks adds up to a big stickin quick.

Give me/us some project info. I'm sure all the fellas here will pitch in.

Bob

Grumpy

Simon your best bet is to make a detailed spreadsheet listing what all is to be done phase by phase and the cost for each phase. This is very time consuming and you will find most of your competitors will bid by the square foot.

I do prefer the first method because it is the most accurate. Add some for profit and overhead. Don't forget your overhead. After youve got your price add 10% for mistakes, negotiation etc...

Glass is right you will need your contract to be very itemized which is where the spreadsheet comes in. Let me give an example.

temporary bracing
front wall demolition
new facade
remove temporary bracing
interior wall demo
interior wall rough electric
drywall
finish electric
floor demo
new carpet

Now you'd need to figure your cost for each of the above and add it all up, and then add how much profit you want to make and your daily overhead (office rent, vehicle payment, equipment depreciation, saw blades, cell phone etc...) Don't forget to figure in any equipment rental.

Now your contract may say something like this

Scope of work:
We will install temporary bracing on the front wall then demolish the facade.
We will construct a new masonry facade as per architectural prints.
We will tear down the interior wall and aged electrical wiring.
We will rewire the wall to modern standards, then install and paint new drywall.
We will tear out the existing vinyl floor tile and install new commercial grade carpet.
We will install light fixtures with a $1,000 material allowance.

see what I mean? You'll obviously want to pad the contract a little bit stating the thickness of the drywall and maybe even the paint color... but the point was you can look at the cost spreadsheet and comapre it directly to the contract. He's not geting anything more than your bidding, and there is very little question as to what he is actually getting.

Good luck!

Glasshousebltr

Here is another idea,

Use more than one contract, brake down the job into several phases then only sell the first of the contracts.

This way if things get out of control, (customer, work scope $mistake, who knows) but you and your customer will be protected on paper for an easy out.

However keep in mind this leaves an open door for your customer to shop around per your phase.

But if you do good work at a good rate the customer will more than likely settle in for the long haul. Comfort means a lot to the happy go lucky homeowner.

Bob

Simon

Thanks fellas, that does help. I had an idea to start like that. Step 1: Demolition...keep the old nut standing too. Junk removal and disposal. Step 2: Rough framing, wire and plumbing layout. Step 3 etc. Then listing materials and overhead for each step. I like the idea of breaking up the gig into stages too, thanks. I also have questions about hiring a crew. I have some connections and people willing to help out. What kind of liability should I be looking at or worried about? Also, and this is talking from a stand point before I have seen the beast, how should I approach my customer and not look like the novice I am? I don't want to make the guy nervous, so is it cool for me to measure the important facts, make my spreadsheet and say...I'll get back to you with the figures? I understand that you old schoolers out there can probably look the sucker up and down and pull out the bid figure from experience. How do I reassure my customer that I know what I'm doing...at least as far as the finished product is concerned? Hey, glad to have come across this page, I appreciate the help!

Grumpy

Glass I like your idea but a better idea would be to sell one contract broken into phases and some kind of exit clause.

Teetorbilt

Simon, I think that I posted a reply to this already somewhere here.
My baliwick is remodeling, I also sub to select developers who value quality work. My contracts are specific as the others have stated but also contain caveats for unforseen circumstances that may be encountered, in FL it is usually water, mold and termite damage.
I strongly suggest that you have your first contracts written by an attorney who specializes in construction (available at your local builders assoc.). You can then copy and modify as required. It's not as expensive as you might think, IF you're a member.
I live in podunk Stuart/Jensen Beach, FL. County pop. 140K in season. I belong to the Treasure Coast Builders Assoc. and the Martin County Chamber of Commerce. I have belonged to others like the BBB that did nothing to promote my business. The two aforementioned were my road to success but you have to work them, become involved, meet the people. I get referals from the most respected contractors and architects in the three county area because I belong to two orginazations.
Try it, you'll like it!
P.S. Incorporate, get ins. and Workers Comp.

Grumpy

Yes Tetor your last pieces of advice were golden. I had assumed he already did this.

Glasshousebltr

Simon, one other thing, maybe the most important in your case, because your kinda new at this.

It's one thing to ask for big money.

It's another thing to ask and expect to get it.

Keep your head up high and look them in the eye every time money comes up.

Bob

Sawdust

I agree with all. The only things I could add is "Be Your Own Punchlist". Nothing impresses a client more than those times alone, staring at their investment, and finding nothing wrong! It takes more effort on your part, but, the benefit is priceless!

Grumpy

Yes Sawdust. There have been times when I would be doing a walk through with the customer and he would be saying how great it looks. And all of a sudden I'd frown and apoligize. "Mr. Home owner overall it looks great but that shingle over there is out of place so I'll have one of my roofers fix it tomorrow." They never even noticed the shingle and now are happy as pigs in mudd that I am honest.

I know some guys who find imaginary mistakes just to do that with the customer but that's playing with fire.

Simon

You guys are the bomb. I've decided to take a big step back. It was one thing to start remodeling houses that I owned with my dad for resale, it is quite another to open the door to legal liability. Rot the authorities! But it cannot be helped. It is a dangerous business out there gentlemen and even the tigers tread softly. So I should really start with the local builder's association, get some legal advice (as your attourney I advise you to get out while you can etc.), and maybe start with some smaller referals. Not a bad gig. I tend to jump in with both feet, but I've found sometimes the pool hasn't been filled yet. I can march on forwarned and forarmed.
Thank you gentlemen.