How to budget winningly with construction estimating services

The success of a construction estimation services provider does not only depend on having a client portfolio that encourages the entry of new projects. The realization of winning work budgets is the initial point to consider. You need to make these budgets attractive enough so the client can sign them without worries.

In turn, they must be profitable for the installation company and allow it to carry out its work with the best possible quality. Only this way, it is possible to retain customers and maintain a particular portfolio. Installers who are wondering how to make a winning work budget will find in this article the key steps to achieve it:

Study the project.

Imagine that an engineering or architecture studio demands a specific project from a company that provides commercial estimation services to different clients. For example, the project consists of assembling an industrial warehouse where the installation company wants to install a power line conduction tray eight meters high. Before writing any budget, the installation company should ask itself:

Do I have the necessary knowledge, technical means, and adequate personnel to carry it out? If it is not the case, they need to consider subcontracting processes. Returning to the example of the “installation of a power line conduction tray at eight meters high”, lifts will be needed that will have to be included in this budget. Do we have them internally? It is essential to know and control from the beginning the items of the project that have an external origin.

Is it technically feasible? It may happen that due to how the installation has been planned by the engineer or architect, it is not possible to carry it out. For this reason, you need assessment that the engineering assembly is real, and that this infrastructure is technically viable. If it is not the case, technical concepts must be rethought from the beginning to ensure that you have adjusted the budget to a real need with construction estimating services. 

In other words, carefully analyzing the construction project provided by the engineering company or architecture firm is the first step in correctly calculating a construction budget.

Be very clear about the costs generated before starting working.

When making a construction budget, you need to consider the following elements (or items), which imply specific costs after using commercial estimating services:

The labor involved in the execution of the project. This point must contemplate the hours dedicated by the staff, but also other concepts such as:

  •         Displacement and mileage.
  •         Subsistence allowance.
  •         Accommodation.

Needed Materials. It is important to have an exhaustive detail of everything that is specified.  These solutions keep the price lists of more than 1,200 brands in the sector up to date. Thus, we can ensure that pricing is simple and automatic.

Auxiliary materials or accessory materials.

This section will serve to cover possible assembly difficulties and the base material that is equally necessary: ​​insulating tape, screws, flanges, etc.

In summary, importance helps us define the breakdown of the project at the material level, the labor level, and the accessories level. Thus, all items associated with execution costs can be controlled.

How can I easily determine how much material I need to carry out the project? 

A work unit library is a catalog (or database) that contains the breakdown of everything necessary to carry out different tasks within a work. This breakdown includes both labor, materials, and accessories.

Therefore, you require a top-class officer and assistant to carry out this specific action. The item in the budget is determined based on the time in hours and its price per hour.

Indirect costs are established on the total amount. They allow covering auxiliary materials for the installation.

How to make a construction budget using the sector’s bookstores?

As we said, libraries are a database of work units. Their main advantage is that they provide ease and save time when selecting budget items. To have these libraries, we have different options:

Standard libraries can be chosen and created by external agents. 

Or you can create your libraries, little by little, as budgets are made. Having a business management software will facilitate the administration of these libraries:

In these cases, the source can be an external library, which you can adapt to the needs of each installation company. Or you can create your own from scratch, saving work units as projects are developed.

Libraries provide agility when selecting the items to include in a budget. In this way, the installer can invest his time in what matters: studying the project and adapting these libraries 100% to it. Only in this way can we make profitable and differentiating work budgets.

Review and recalculate the numbers: Are we making a winning budget?

It is time to make the final calculation of a working budget. The items are reviewed one by one to ensure that all the necessary elements are being considered in construction estimating services and that we are applying the profit margin that interests us. This recalculation will consider:

The desired industrial benefit.

The adjustment of costs is due to the characteristics of the project.

In the example of the assembly of the line of force that we talked about before, it will not take the same number of hours to do it at ground level. We also need to adjust materials and hours depending on the specific characteristics of each work.

A percentage of added cost due to the financial surcharge Imagine that the project is of long duration. The installation company will not charge immediately. In addition, due to the project’s complexity, it must resort to external financing.  It allows the assumption of debts not compensated in the billing until within a certain period.

The updating of material costs, especially if solutions such as the Data Bank are not available. We must ensure that the prices used are the real ones.

Updates on labor costs. Once you calculate the total amount, the company decides to readjust values ​​to make them more attractive to the customer. 

It is important to mention that each budget will depend on the company that carries it out, the project itself, and the area in which it is working. Therefore, the profit margin will always be different considering these factors.

Have a management software that allows budgets to integrate with the company’s global budget:

Today, there are business management tools. These solutions include a budgeting module with which the installers will know perfectly how to make a winning work budget. However, it will allow linking these budgets with the accounting area, portfolio management, purchasing department, commercial estimating services, etc. Therefore, the managers find the company’s general management much more convenient.