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Discussion Starter · #1 ·
I have had many requests in the past to breakdown the particular costs of remodel project; plumbing, electrical, framing, etc. I have never shown this breakdown because I like to present the project as a complete package. The same way you don't know how much the engine and tail lights cost on your new truck. I also use the same team on every project. I've found that people only request this when they want to try and contest each part of project.
I am curious to see how others handle this. I am bidding on a large project, and my existing philosophy does not look like it will cut it in this situation. I know to never stray from the process that works, but it will likely lose a promising project.
 

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I always handle it the same way you do.I never give break downs.It only leads to problems. "I saw those same doors in a HD depot flyer today for 5$ cheaper"
I've got some 16d nails left in my garage"
Can't you use the extras we had left over from ??
It will always come back to bite you in the ass!
 

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Talking Head
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The only breakdown I will give is the total cost of upgrades or additional projects, e.g. tile shower instead of insert, deck and screen porch as separate items. I understand that people don't know what projects cost and might only be able to afford some of their wish list. I won't provide specific labor, material or subcontractor pricing. Every time I have done that I either get dirty looks and lose the job or the haggling starts. Every. Single. Time.
 

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Have Trowel, Do travel
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OTOH, all my prices are broke down, I really cant see any other way to do it.
example: say you have a project start to finish, that you priced one job, say a concrete column 12" x 12",H= 8ft. at 25 bucks a cu.ft, and the project you bid on called for 6 of them, and your price for 6 was 3600 bucks.
now lets say the project changes, nows there only 4,
How does the HO, or Engineer know what is the price difference? Lets say they add 3 more
during construction. how would anybody know what your costing?
By having the prices broke down everything is clear to all,
Its the only way.
I know that many contractors and GC's make most their money on change orders,
and I also know that many price jobs below costs waiting for the Change orders to make their pay.
We dont work that way.
Our prices are DETAILED, and instead of 1 bath, the client decides on 2, or decides to add 8 more electrical boxes, they have the costs upfront.
If they decide on a stone staircase, instead of wood, or marble, they have the costs upfront.

I know many for many here that goes against your business practices, You would never work for me, or for the fact 99.99% of my clients.
but then again... what do I no :)
 
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Discussion Starter · #5 ·
I love how serious people get on here. 99.99%! We must have a different customer base, because we do pretty well on the sales side. We are also extremely detailed and do not by any means rely on change orders for added profit. Sounds like you know some hack contractors. We have all of the micro details you mentioned, we just rely on our process to turn out high level work at all times. Some customers get jazzed up on HGTV and see prices that may not be realistic. Since you show Absolutely everything, and I do respect however you do it, let me rephrase the question. How do you deal with a customer that would want to contest your plumbers cost, or the price you are paying for a slab?
 

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Drywall Slave
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A G/C Should make money off his subs. I think that's how the business works. If an H/O wants a break down of Time and material for all involved on the project ..I'd be worried about money at the end.
 

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Have Trowel, Do travel
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I love how serious people get on here. 99.99%! We must have a different customer base, because we do pretty well on the sales side. We are also extremely detailed and do not by any means rely on change orders for added profit. Sounds like you know some hack contractors. We have all of the micro details you mentioned, we just rely on our process to turn out high level work at all times. Some customers get jazzed up on HGTV and see prices that may not be realistic. Since you show Absolutely everything, and I do respect however you do it, let me rephrase the question. How do you deal with a customer that would want to contest your plumbers cost, or the price you are paying for a slab?
GC's all bid to spec. as you should already know, when their are 100+ pages of a job. the clients always flip to the last page where the finale price
of their job is,
they initially have no idea what the other 99.5 pages mean untill after they decide to change something.
THEN, they "try" to go thru work description detail by detail, and to someone that does not do this day in, day out, they become quickly disorientated, then go thru their Geometer/Engineer who is able to tell them how much each change will cost... as you already know.
Being good at bidding is truly an art form IMO, knowing what gonna happen thru-out a work process,
knowing which articles on the bid to low-ball, and which to hammer on, makes all the difference in the world.

Most bids I am able to pull in 35% profit bidding 20% lower than you
 

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brunothedog said:
OTOH, all my prices are broke down, I really cant see any other way to do it. example: say you have a project start to finish, that you priced one job, say a concrete column 12" x 12",H= 8ft. at 25 bucks a cu.ft, and the project you bid on called for 6 of them, and your price for 6 was 3600 bucks. now lets say the project changes, nows there only 4, How does the HO, or Engineer know what is the price difference? Lets say they add 3 more during construction. how would anybody know what your costing? By having the prices broke down everything is clear to all, Its the only way. I know that many contractors and GC's make most their money on change orders, and I also know that many price jobs below costs waiting for the Change orders to make their pay. We dont work that way. Our prices are DETAILED, and instead of 1 bath, the client decides on 2, or decides to add 8 more electrical boxes, they have the costs upfront. If they decide on a stone staircase, instead of wood, or marble, they have the costs upfront. I know many for many here that goes against your business practices, You would never work for me, or for the fact 99.99% of my clients. but then again... what do I no :)
I disagree. You can list how much of each item you have, but state a lump sum at the end. I don't want my clients doing their own estimating with my numbers.

Maybe they cut those 6 columns to 1. I'm not going to do 1 column at the same rate as 6. Or 600. There are set up charges, economies of scale, rental, consumables, etc. that all play a part into unit costs.

My estimates are based on production. On one wall I might be able to lay 15 block/man hour, but on another I might be able to get 20 block/man hour. That changes my unit costs. How do I know which wall they are deleting the block from? I'm certainly not giving them my takeoff and production rates.

I'll break out estimates if asked, but only by division, not unit price.
 

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Talking Head
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What John said applies to me as well. It's very different for remodelers than for a lot of the subcontractors(not trying to pigeonhole you Bruno). The specialists and subs have a lot more control over their piece costs. As a remodeler, when a customer wants to start messing with Step 12 in a 35 step process it really starts to mess up my pricing and estimates are pretty time consuming. Some people come to me with a $2 per square ft tile to replace a $7 per square ft tile and assume that it's automatically $5 per ft that stays in their pocket even though the new tiles are seconds and badly out of square.

I do things the way I do them to achieve the quality level I strive to produce for the lowest cost I can. The HO can add or subtract from a Scope of Work but they can't tell me how to do the job. It's false economy.
 

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A G/C Should make money off his subs. I think that's how the business works. If an H/O wants a break down of Time and material for all involved on the project ..I'd be worried about money at the end.
I would say that about 99.99% of the time :)jester:) if things are a bit flaky on the front end, things get equally flaky on the back end (i.e., time to get paid).

I am of the opinion that if I break down my price to show everything from material costs to my overhead and profit, that is not anyone else's business but the business owner. If a customer doesn't like the price that is their prerogative, no harm no foul. If they want something broke out such as say allowances for specific items, or various methods/materials to accomplish something, that is also not a problem. But why would anyone need to know all the numbers unless they have some other intention, such as haggling, or creating future problems/issues, particularly when it comes time to pay? Whether I mark up materials 25-35% is not their concern because I am not only providing a service at that specific valued promised, but as a business I MUST know my numbers and what EXACTLY it is going to take to remain viable now and in the future.

If someone pays my bills (all of them) then perhaps they have a need to know all my numbers, or can haggle over price, etc, but until then.....
 

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Discussion Starter · #11 ·
I appreciate the feedback. This is all good info. Sounds like most of us are on the same page. The breakdown of a job's cost to separate trades and materials always seems as if the negotiations are headed in the wrong direction.
 

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Have Trowel, Do travel
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I disagree. You can list how much of each item you have, but state a lump sum at the end. I don't want my clients doing their own estimating with my numbers.
The lump sum at the end is the SUM of all the SOW's listed for that particular work.

HERE, you have really no choice,
The bid proposals are already written for you to complete by their Engineering studio.

And each work to do is written out with EXACTLY what is to be done, what material they want to be used, and in which order it is to be done.

If you don't like it, You dont work.
 

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It's a sales objection indicating fear of making a mistake.

Text book process of overcoming the sales objection of making a mistake

1. Ask WTF (aka qualify deeper to explore the motive behind the injection)
2. Use answer as insight into solving the problem
3. Make a confident recommendation
4. Re-ask for the friggen sale to bring out any other objections you need to bat down so you can get to the close

For example,

Wallet: Can I have a breakdown of the blah blah

You: I don't normally present my proposals that way. What is the purpose for that additional documentation?

Wallet: We wanted to now how much cost the stand alone shower added to the cost of our SOW.

You: About $blank. Is there a concern about the budget that we should discuss?

Wallet: Well we were hoping to be at $

You: I understand that but we did talk about your long term satisfaction and the cost of that investment over time is nickels per day over the life of your project. Are you sure you would be satisfied over the long term eliminating that comfort item from the project when it only adds such small amount over the life of the project?

Wallet: Not really.

You: Well I guess we have our answer then. We have been careful about including everything that is important to you to achieve long term satisfaction of your investment. without a compelling resin to remove something, I recommend we include it as an important component of the most satisfying project possible. Based on our careful your prior discussion, I am sure you won't regret it in any way later. Is there anything else you are concerned about?

Wallet: No. I think we are good.

You: OK then the signature I need goes right here (Hand them a pen)
 

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... I am bidding on a large project, and my existing philosophy does not look like it will cut it in this situation. I know to never stray from the process that works, but it will likely lose a promising project.
How large is the project? Have you successfully bid other projects of the same size, using your normal system? If "Interior Remodeling Contractor" means a single family residential remodel, even a large one, then don't do it. If you're proposing to do a $10MM interior remodel on City Hall, then you might be required to do it to bid the job at all.
 

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Hair Splitter
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OTOH, all my prices are broke down, I really cant see any other way to do it.
example: say you have a project start to finish, that you priced one job, say a concrete column 12" x 12",H= 8ft. at 25 bucks a cu.ft, and the project you bid on called for 6 of them, and your price for 6 was 3600 bucks.
now lets say the project changes, nows there only 4,
How does the HO, or Engineer know what is the price difference? Lets say they add 3 more
during construction. how would anybody know what your costing?
By having the prices broke down everything is clear to all,
Its the only way.
I know that many contractors and GC's make most their money on change orders,
and I also know that many price jobs below costs waiting for the Change orders to make their pay.
We dont work that way.
Our prices are DETAILED, and instead of 1 bath, the client decides on 2, or decides to add 8 more electrical boxes, they have the costs upfront.
If they decide on a stone staircase, instead of wood, or marble, they have the costs upfront.

I know many for many here that goes against your business practices, You would never work for me, or for the fact 99.99% of my clients.
but then again... what do I no :)
I didn't need to know any of that to know that I would never work for you or with you.

If someone wants pricing they ask. No need to break anything down. Things aren't that cut and dry. Adding a bathroom cannot be done by knowing what another costs.

Also change orders don't necessary get the same charge as the original project. Lead times, delivery charges, there are just too many variables.

Plus I still have control. No way am I handing control over to every customer.
 

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Hair Splitter
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The lump sum at the end is the SUM of all the SOW's listed for that particular work.

HERE, you have really no choice,
The bid proposals are already written for you to complete by their Engineering studio.

And each work to do is written out with EXACTLY what is to be done, what material they want to be used, and in which order it is to be done.

If you don't like it, You dont work.
And that's why I live in the good old US of A!
 

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Hair Splitter
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It's a sales objection indicating fear of making a mistake.

Text book process of overcoming the sales objection of making a mistake

1. Ask WTF (aka qualify deeper to explore the motive behind the injection)
2. Use answer as insight into solving the problem
3. Make a confident recommendation
4. Re-ask for the friggen sale to bring out any other objections you need to bat down so you can get to the close

For example,

Wallet: Can I have a breakdown of the blah blah

You: I don't normally present my proposals that way. What is the purpose for that additional documentation?

Wallet: We wanted to now how much cost the stand alone shower added to the cost of our SOW.

You: About $blank. Is there a concern about the budget that we should discuss?

Wallet: Well we were hoping to be at $

You: I understand that but we did talk about your long term satisfaction and the cost of that investment over time is nickels per day over the life of your project. Are you sure you would be satisfied over the long term eliminating that comfort item from the project when it only adds such small amount over the life of the project?

Wallet: Not really.

You: Well I guess we have our answer then. We have been careful about including everything that is important to you to achieve long term satisfaction of your investment. without a compelling resin to remove something, I recommend we include it as an important component of the most satisfying project possible. Based on our careful your prior discussion, I am sure you won't regret it in any way later. Is there anything else you are concerned about?

Wallet: No. I think we are good.

You: OK then the signature I need goes right here (Hand them a pen)
It's like when my wife asks 20 questions about what I have planned for the rest of the day instead of just asking me to do what she wants me to do.

They ask all the questions around what they really want to ask. It's our job to discover that question and address. Your example is perfect. :thumbsup:
 

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Have Trowel, Do travel
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And that's why I live in the good old US of A!
you must be small time,
Almost all commercial jobs you bid spec.
When someone asks you to build a house, your telling me that you give a lump sum?
Sometimes I get the feeling that many here dont know their a$$ from a hole in the ground.
but only sometimes :)

You also seem to have one hellofa chip on your shoulder, You seem to have a BIG problem hearing how others do certain things,

AND, the good ol USA ain't what it used to be.

let me guess, your a liberal?
 

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Licensed Gas contractor
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The lump sum at the end is the SUM of all the SOW's listed for that particular work.

HERE, you have really no choice,
The bid proposals are already written for you to complete by their Engineering studio.

And each work to do is written out with EXACTLY what is to be done, what material they want to be used, and in which order it is to be done.

If you don't like it, You dont work.
A buddy of mine was once asked by a non US person to show him the invoice from his supply house so he could see what he paid for the product. He said that where he was from, they only pay X% over the invoice.

We don't do business her like that in the US.
 

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you must be small time,
Almost all commercial jobs you bid spec.
When someone asks you to build a house, your telling me that you give a lump sum?
Sometimes I get the feeling that many here dont know their a$$ from a hole in the ground.
but only sometimes :)

You also seem to have one hellofa chip on your shoulder, You seem to have a BIG problem hearing how others do certain things,

AND, the good ol USA ain't what it used to be.

let me guess, your a liberal?
Sure on plan and spec jobs you break out costing. But only by division. I've yet to see one where they asked for my 19 page estimate breakout. I bid big work all the time. :thumbsup:
 
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