When it comes to any sort of contracting work, estimating is an essential part of keeping your company profitable, and concrete is no different. But what exactly should be involved in your estimating process? What do you need to know to develop a reasonable estimation of the costs involved while still making a profit and padding any potential issues the job may bring up? In this article, we'll explore the different aspects involved in estimating concrete work and how to plan the task to get a complete proposal in when it's due, with all the required pieces in order.
What's Involved in Estimating Concrete Work?
- Where is the project information coming from? There are many potential sources for projects, including trade associations, incoming inquiries, networking and any number of professional websites that track upcoming bids. This information is important as it will dictate how much information will need to be on the estimate and what additional documentation will be required. If you're pouring a small patio pad for a homeowner, a simple one-page estimate may suffice, while a multi-story parking garage may require bonds, insurance coverage, proof of particular certifications and any number of other items.
- Are you breaking into a new skillset for this project? If you are, you may need to pad your numbers somewhat to account for additional labor for the learning curve or potential issues you hadn't expected. If a project is just a little different than your current experience, such as going from pouring a 3,000 PSI slab for a driveway to a 4,000 PSI slab for a small business, it's probably a good option. If, on the other hand, you're going from basic residential work to a cast-in-place skyscraper, you're probably going to get in over your head.
- If you're bidding a specialty residential or commercial project, what are the specifications for the project's concrete needs? Is it air entrained, require retardant to slow the cure process, exposed peagravel or similar specialty mix? Will it require longer set times because it's a winter pour and will require heat? Is it a high-strength concrete that will require regular testing of the mix to ensure it meets proper strength at various points? By knowing your materials, you'll know if there are any external requirements beyond ordering a particular type of concrete.
- Are there any issues with getting equipment working on the site? If there are bad or nonexistent roads, will you need to rent construction pads to get a mixer truck in? Is there sufficient electrical service available to run a smaller mixer or your concrete saw? A project that requires the use of specialty equipment to get the job done may cost significantly more than an easy-access project with everything you need on site.
- Perform a takeoff by determining how many anchors, rebar, reinforcing mesh or other materials you'll need to complete the project. Don't forget to add a bit of padding for job site waste. You'll also need to determine what type of concrete is needed and how much you'll need by measuring the space and calculating your cubic yardage. You can record your calculations on a worksheet or list, but make sure you approach the takeoff the same way each time and check your work for accuracy before you continue. Does the project require specific materials that are outside of normal use, such as colored concrete, reinforcing fiber or other uncommon material? If it does, you'll need to learn how much these materials cost and if they'll require specialty handling, different curing techniques or additional labor to make them come out right.
- Once you've determined what materials will be needed, you'll need to price them and then move onto calculating labor. Better estimating software has a cost database built in that is automatically updated by the software developer, which can save significant time compared to manually pricing each component. You'll also want to get a bid from at least a couple ready-mix companies in the area to cover the cost of any concrete delivered to the job site. To begin estimating labor, you'll need to get an idea of how long the installation will take, as well as noting areas that will be difficult to complete, requiring additional time. You'll need to include the cost of wages, insurance and similar expenses under your labor costs.
- Now you'll need to add in your overhead and profit. Overhead covers all of your expenses that you'd have even if you don't win the job. It can include your office staff, advertising budget, office expenses, liability insurance, business licenses and similar costs of doing business. Once you've figured that out, determine how much of your yearly business income this project would represent. If it's a $250,000 project and your business usually brings in $2 million, that project would need to carry 1/8 of your annual overhead. Once you've determined the overhead, you'll need to determine how much profit you need to make and add that to your figures.
- As you finish, you'll want to review your work or get another set of eyes on them to make sure they're correct. At this point, you'll also want to make sure you've gone over all the bid requirements to ensure you have all your paperwork in order. In general, if the paperwork was requested in a list, you'll want to return it in that same order so the project manager or owner will be able to quickly find what's needed in your package.
Is there an easier way to finish a estimating a concrete project? With the right software, you can minimize your office time and maximize your profitability. Esticom's software is developed by construction professionals to provide cross-platform operation with MS Office, Adobe Acrobat and Quickbooks. It gives you an up-to-date material cost database, customizable proposal forms, marketing analytics and accounting compatibility. Ready to give it a shot? You try it for free here