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Howdy all. I was wondering what folks have found is the best way — in practice — to estimate and account for plumbing/electrical sub costs in the process of bidding on jobs.
Up to now I have been surveying jobs, working up materials, and then calling a bunch of plumbers to get some sense of how busy they are and what they would charge. I’m new to the area I work in now, so don’t have an established network of guys yet I can rely on. I’m thinking recently that it might make sense to ballpark the plumbing estimate myself (and perhaps even let the customer know that the number could move a little), and hold off on talking to the plumber to cost the job until the bid has been excepted, and downpayments made — at which point I can bring a few guys in to actually look at the job, based on availability.
Under my current method my worry is that, over time, if a few bids don’t close, credibility will be lost. Is there a sort of accepted practice along these lines that subs accept/expect in this process?
Aside from being new to the area, I’m relatively new to the business. Any help with a rookie question is appreciated.
Brian
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there are 2 general methods of bidding:
1 ) especially in public bidding.. the GC estimates the job & all the trades.. if he wins the job.. he "sells " it.. he sells the elec. to an elec. sub.. plbg to a plbg sub , etc...
usually doesn't work too well in residential remodeling.. so method # 2..
you work up the specs... you call your FAVORITE subs.. ask them for a PRICE... and plug the PRICE into your estimate.. if you win the job .. they get the job....
if you screw with them.. they stop giving you prices .. or start inflating their prices.. it all comes down to trust...
.. me , i want subs watching my back.. and i'll watch theirs... so.. i usually only work with one or two in each trade...and keep them informed of what is going on..
*I do the same as Mike in using the same 1-2 electrical, plumbing and drywall subs. We have built a relationship over the years that has been beneficial for us all. Eventho I am a one guy remodeler and my volume is not large, each and every sub I work with treats me (schedulewise) like their most important customer. With enough warning, they'll show up when they say, and complete the work b/4 running off to another job. Stay away from those "work on 4 jobs in a day guys", they're a waste of time. Being ready when you say and prompt payment keep them coming back. As to the pricing, I pretty much can plug in a price range according to the work necessary, but do verify with them b/4 final bid. Any questionable situations and I get them in on it right away. 99% of the time we have the job going in, we just need to come up with a budget. Not having to competitively bid sure has it's benefits, but getting there is alot of work.Another thing, I usually request the same crew from the subs as we really work well together. All the trades think as one and the end result is a much better and smoother job.Best of luck.
*A common dilemma.I agree with all that has been said.As a gc, you have a warehouse of labor to sell, you should know what it costs. Your subs should know what it costs.Having been a sub, I never thought I should have to go look at every job my generals bid. If as a sub I bid every job for every general, all I would do is look at prospective jobs for generals. If they have a good close ratio, maybe it would pay to look at them ahead of time particularly if the send me a bunch of work. Problem there is your subs get too much control of your costs.The way I work it is this. I generally get a lot more time to look at the jobs. I know about how long the subtrades will have into a specific job from experience. I give an allowance for these types of items including labor and materials and fixtures. I explain to my customers that these items generally cancel themselves out. I still have to give and accurate estimate for the allowance or goodwill will be lost, but if there are unforeseen circumstances I am covered. The key is educating your customer as to what you expect to find that way if there are problems they will expect to pay. Basically this method eliminates trying to write bulletproof specs. When it comes to mechanicals in remodeling, I have found that subs will try to cover their asses if you ask them to bid. Hopefully, I have put alot more thought into it than they would have in a short visit to estimate.That's what I do.
*We use Mike and Calvin's system and we can often use the numbers from a similar job from the recent past to save some of the leg work when there is just a fixture allowance. Of course, we all have established businesses and good working relationships with our subs. You, on the other hand, need to build those relationshsips. Your most difficult job is to identify subs whom you trust and who will share your idea of what a good job is. Believe it or not, it is possible to find these traits in many subs, not because they are the tops in their field, but because you can promote these traits. First you need to extend trust to them and second, you have to let them know what you expect of them, partly by words, written or spoken, and mostly by your actions and those of your employees. Most people want to be their best and are dying for the chance.Don't worry too much about asking subs for a price on any sizeable job. You may find that they have already figured a price for one of your competitors and will give you the same quote. Good subs are meticuous about giving all bidders the same price. Good luck and work hard on this aspect of your business.
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Howdy all. I was wondering what folks have found is the best way -- in practice -- to estimate and account for plumbing/electrical sub costs in the process of bidding on jobs.
Up to now I have been surveying jobs, working up materials, and then calling a bunch of plumbers to get some sense of how busy they are and what they would charge. I'm new to the area I work in now, so don't have an established network of guys yet I can rely on. I'm thinking recently that it might make sense to ballpark the plumbing estimate myself (and perhaps even let the customer know that the number could move a little), and hold off on talking to the plumber to cost the job until the bid has been excepted, and downpayments made -- at which point I can bring a few guys in to actually look at the job, based on availability.
Under my current method my worry is that, over time, if a few bids don't close, credibility will be lost. Is there a sort of accepted practice along these lines that subs accept/expect in this process?
Aside from being new to the area, I'm relatively new to the business. Any help with a rookie question is appreciated.
Brian