Tip #1: Choose Your Projects Carefully
When you’re eager to build your backlog, it can be tempting to bid on every construction project that comes your way. But as many contractors have discovered, winning the wrong project can be an expensive and time-consuming mistake that should be avoided at all costs. That’s where the benefits of an automated estimating system become clear.
Wading through paper bid sheets from the past to review a bid and analyze project profitability-- and using the results to pick and choose which bid requests you'll respond to-- can be an overwhelming task. Plus, spotting key trends and project categories can be difficult, if not impossible, using manual methods. ProEst's powerful reporting capabilities help you analyze which types of jobs will be most profitable for your company, and give you a better idea of the jobs that aren’t the right fit.
Tip #2: Pay Attention to Project History
You can learn a lot by analyzing the details of past projects and applying those insights to any future jobs you’re considering. Building—and using—a detailed project history library to help inform your project proposals and business priorities is increasingly important protection from repeating past miscalculations and costly mistakes. ProEst estimating software is designed to accelerate this process, giving you instant access to past estimates, reporting, project budgets, bid sheets and other historical information. Not only can you quickly access similar estimates from past projects using any criteria you choose, you can also use ProEst to make modifications and adjustments to current estimates based on what you’ve learned.
Tip #3: Refine Project Costs and Processes
It goes without saying that a winning bid accurately reflects the costs your business will incur until the project is completed. But construction is complicated, and with so many elements to manage, costing errors can and do occur. The most common errors to overcome involve miscalculations when compiling a bid, i.e. overlooking some elements of the scope of work, using inaccurate footages or board counts or making mistakes in basic math functions like addition and multiplication. All are easily solved with an estimating system like ProEst, a system that performs calculations automatically without the risk of manual or re-entry errors.
Moreover, ProEst has a built-in general contractor database that lets you establish your estimating database in CSI 48 division format. That means you can perform unlimited sort types, which will allow you to drill down into the details of your work using any criteria you choose. You can also analyze project cost centers to uncover potential bottlenecks or processes that can be revamped—the key to strengthening your efficiency and improving your bottom line.
Tip #4: Identify Customer “Red Flags”
As any contractor can tell you, not all customers work the same way, and even a regular client has the potential to become a "hidden money pit" that you need to be fully prepared for. Whether it’s a client who issues multiple RFIs, repeatedly causes project delays or is constantly putting in change orders, it’s important to know in advance what issues you’re likely to encounter while the project is underway—and how much they may end up costing your business. With ProEst, you have a new ability to plan ahead. It lets you review jobs by customer and prepare reports that will show you in aggregate which clients and jobs are meeting or exceeding your desired profit margin, and which ones are having a negative effect on your bottom line.
Top #5: Avoid Being Unrealistic
This tip may sound obvious, but as competition for projects increases, it can be tempting to under-estimate project costs and timelines in order to win a bid. When contractors shave too much money off their proposal price or too many days from a project timeline in order to secure a job, those decisions can ultimately backfire. After all, assuming that the shortfall can be made up with change orders, extra charges associated with delays or updated labor and material pricing is risky business. and can end up creating mistrust with the customer, Moreover, if change order avenues aren’t in place, losses are virtually a given.
That’s just as true for the project schedule. If it becomes clear that the estimated timeline is not achievable, it may cast doubt on a contractor’s professionalism – or even honesty. After all, project owners often evaluate bids for overall quality rather than just a low price or fast timeline. Having confidence that the bid is accurate, honest and realistic is a swing factor that can work in your favor.