🔴 REPLAY: How to Estimate Construction Jobs to Ensure a 50% Gross Profit
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- Опубліковано 14 жов 2024
- How to Estimate Construction Jobs to Ensure a 50% Gross Profit
Join me as we break down how specialty contractors can estimate their projects to ensure they always get a 50% Gross Profit.
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"You don't wanna win every job, you want to win the right jobs."
Solid!
I have that mentality with Doordash! Some deliveries aren’t worth it.
I just found you today on the day that I am so stressed out over my start up. Thanks I really needed it. Semper Fi
Glad I could help brother.
Just amazed at everything that i have learned in the past 45 minutes
I just started my business and I always tell them, "I don't know what hes doing to charge you so much less but if you want it done right then this is my price with a guarantee."
@Nikolai Ninja lol
I have more than often run into people wanting a MANSION of a Job but expect to pay TRAILER PARK PRICES. I agree with you, and I calmly and simply state basically the same as you. You get what you pay for.
Plus People will ask CAN YOU DO THIS OR CAN YOU DO THAT, and I tell them, look, I am not trying to price gouge you but You have to figure out what your budget is and I will be able to tell you what can be done for that price range. Of course the more money someone has the more that can be done. NOTHING COMES FREE IN LIFE.
I like it nice mind games
It’s not mind games it’s called knowing you’re worth
This is late as fuck but, I've come to realize, most the people who say that are just trying to negotiate your price, to bring it down. Most of the time they themselves did the estimate and are expecting their price rather than yours. (MOST OF THE TIME)
I’m currently a first-year electrician’s apprentice with the IBEW, and I hope to open my own business in the future. Your videos give me a lot of insight into the world of contractors. Thank you so much for sharing your knowledge with the world.
Best of luck Andrew!
I’m just starting out I do decks, kitchen and bath remodels. My bids were terrible lowering the cost to get the work worrying about my customers pocket more than mine. my one employee and vendors got paid first and then myself. My overhead tools, truck payments was coming out of my income. Clearly that wasn’t going to work. I implemented this on my last couple of Jobs its like a whole new world. Thanks for this information very easy to implement easy to break down labor cost and overhead.
New to your channel and all I can say is thank you. My mind set at the moment is kick myself in the ass for not find your channel sooner. Almost everything you said not to do I have been doing for the past 6 years, even up to my bid I submitted last night. Ive been beating my head trying to find ways to just break even and I stumbled upon your channel a week ago but wasnt able to watch but a few minutes of one of your videos until now. You're truly amazing. Thanks for the info and most importantly thanks for setting me straight.
I would like to Thank You for taking the time to share your unfiltered knowledge. Traditional learning has always been a challenge for me. Your to the point, no bs, do this, is awesome.
Thank you so much for this knowledge you are sharing, I’m in the remodeling business and it’s been so thought to make money but by watching your videos I have bee recognizing my mistakes, thank God that there is people like your self educating us the contractors, like you said before we want to deliver great service but we also deserve to be compensated for our work and our knowledge. Thanks again 👍🏻
Many times tried all- you are saying, and yes, problem inside my head. Thank you for the lesson.
thank you so much for presentation.in my line of work i go through this every week.too many low bidders trying to get the jobs.
Totally agree with you!
I've been in business for over 20 years and never had anyone to show me how to do it.
learned it all on my own.
I wished I would have been told these things 20 years ago.
This channel is a damn gold mine.
Welcome to the Fight! Glad you like the content.
Started my business in 1997 didn’t figure out this until 2016 thanks for helping people
Thanks for watching Adam
4 years later and is more relevant today than in 2018. Wonderful content.
I am really thankful for your posture on family. We only do this so we can have them. Thank you so much!!!
Thanks for being part of the Fight Tristin
The simple word made my day: “ignor the competition “😊 love it
July 2021, love this channel. Dude knows what he's talking about.
You just gave me a lot of trust in my math... thank you very much!
Thanks for watching Robert. The math never lies.
I'm just starting out on my own and this video is just what I needed. Thanks Tom!
Every business needs to know this !!! Thank you very much.
You're welcome Taleb
That's the key confidence in yourself and the ability to get them dressed you.
Great info. On bids, I always make a weekly benchmark payment schedule as part of my bid and contract. My rule is never more than a week's payment behind so I never lose money. Clients are comfortable with making smaller payments on definable benchmarks. As far as clients claiming banks only let them make monthly draws I tell them it is never a problem for me because I do not function as a bank for clients. I say almost every house I work on gets sold after I finish working on it. That's because we create equity and I never have any problems with people who need my work. Thanks again, big help finding the fight.
I love what am hearing from you you make me feel so good about my self because I am confused about Estimated
Great video. Since day one I've been trying to follow these guidelines. It is tough. Especially the going rate part. But it is true. Your prices need to be what you need them to be. I catch myself sometimes lowering the price because I'm assuming the client won't like the price.
I've done that also. Just to get the job.
Totally agreeing with you about fear. Thank you very much for the fear kicking out!
Incredibly educational training tip, Tom. Thank you so much for sharing these tidbits of knowledge. I've already begun implementing your system of ethic into the new company my business partner and I are building up. I'm excited for the daily tips as thats always a good refresher to help keep you focused and abreast of all new ideas. Keep up the awesome work, I TRUST your knowledge based upon the depth of QUALITY knowledge you bring to the table.
Thank you for these videos, I recently started a metal fabrication business and just found your videos. Brilliant, really helpful
Glad to help Steve!
That’s for the structure. The order this was presented was excellent. I’m trying to learn how to bid for the construction company I work for. Since the owner has spoken to me about it being a potential opportunity.
Thank you sir!
Always a good thing to keep reviewing your numbers and methods
Your right gotta commit!
Can always get more money.
Cannot replace time lost.
I can build a lot of things. I'm good at construction. I have absolutely no idea how long things will take. I'm so upset with myself for not making notes on all the jobs that I did for other peoples companies when I was being paid hourly. I've never heard one negative comment from a boss about the quality or the time it took me to do a job. I'm so screwed at figuring out how much to charge people. Every time I bid a job low I get it. Lately I've been getting jobs that I had under bid and my customers have been voluntarily just paying me more once the jobs done because my work is good and they know I horribly underpriced the job. It makes me sad but it's also been a lifesaver.
Thanks for making such videos. Appreciate your content for specialty contractors.
Theresa difference between custom homes and tract homes built at 70 to 90 a ft and going with lowest bidder to custom homes going for 190 to 350 a sq. Ft build period
Third time watching this it never gets old
Appreciate you watching it Dameon!
Outstanding counsel! Thank you. Paying attention to costs closer than ever. Going to hit that 50%! AND stay there
You got this William!
Hey Tam Alex the Picasso here Maestro either do it right or don’t do it at all right Tam?😂🤣 happy to see you buddy ! .
Thumbs up and subscribed! 👍
Thanks for making sales fun and not having to feel like your selfish. It is necessary!
Great information. I have been doing side job GC work for 25 years... (mostly friends needing work). My full time job is I.T. and my company was bought out by HP. I am now deciding to License, Bond and Insure and give this a go for at least a year. I want to do this right and ethically (Ithica in the greek) and your information is echoed through other videos I've watched and its like you've been examining my pricing dilemmas. My pricing sheet has been a nightmare to put together. It wont be now. 50% Gross profit it is. 2 x Cost moving forward.
I'm a Software Engineer too trying to get into some GC work. Do you do the estimation yourself? And if so, how did you learn how to estimate for each trade without actually working in it yourself (assumption).
Pretty good video!
Thanks for your tips.
Dang, this is exactly what I needed to watch. I liked the comment about where the money is gonna come from to go fix that shit 😂 because that's exactly what I was thinking. This is a great video, thank you so much.
Thanks Tom. Great information and encouragement.
Thanks for watching Chris!
Wow, great video. I have been following fight club for a while but having this broken down like this really takes it home.
Thanks for being here. How can I help you more?
Awesome knowledge! Appreciate it!
Thanks for all your info . Priceless and appreciated big time.was wondering if you have any vids on financing jobs to improve cash flow? I’m always running tight on net 30 terms as a sub , I’ve found some solutions but still never stop looking for a better way.
Thanks
Great idea to use you distributors e commerce sight for quoting. Have your pricing loaded and use the site fir a quoting tool. Plus you can See stock.
Amazing I'm getting the right confidence with your knowledge.
I'm ready to put my puzzle in the right place.
Your stab has So many keys that are opening my mind in the right time.
This crisis for me it's the right time ,thank you so much...
Nice window view #EstimateConstructionJobs #enjoylife #contractorfighttv #grossprofit #learntomanage #constructiontutorial
Bro... your straight up value! Sincere thanks
Thanks for your prospective, thumbs up and subscribed!
Thank you for the video. Learned a lot
so glad i found your channel
damn your on it ! not sure why your giving this information for free ! Thank you ... no matter what , your plan is good or bad , Im thinking in a new way !!!$$$
Thanks for the feedback Nute. Glad you're enjoying this content.
just found this and your channel. damn glad i did. thank you
Great lesson man! Chasing my tail for years, and looking forward to getting this shit right now. Appreciate this very much!!
How have your last five months gone?
Work your technical issues out prior. Key to success!!!!
Watching 4/2/22
Bailed
Mate you're awesome at what you do
Thxs for your videos. .I just started my own Drywall buisness .Its been a hard year .Iam learning the hard way day by day.
How is it going now?
I totally agree about the fear factor. When ppl tell me, well amigo at homedepot will do it for 15$ an hour, Ill let em know quick. Well amigo is your guy. Call me when you want quality. And that my kind Sir is really gonna cost you.
Thank you sir, this knowledge is powerful
Glad to hear that Ojong!
"Mental Energy"... Tom, that is so relevant!!!
Awesome. How I found you was searching for how to estimate a job for something I either have never done, or just don't know how long it's going to take. Say it's a spiral staircase build or something. Is there a database out there that says what the typical MH is for performing that work? Because I want to move away from billing hourly, it sucks.
FEAR OF NOT KNOWING MY MATH It has been 10+ years since I was doing Contract work and in the past I was working a full home rehab construction through a different process so I Know How to Price a house for a full FLIP ( In general ) But I really don't know what costs are for a Kitchen remodel or a bathroom remodel . BUT I guess for now it does not matter until I can win the lottery because I don't have the money to start again and can not get a loan to save my life.
Subscribed. Clear and excellent communication.
Wow, ty so much, I think you just changed my life .
Thanks for watching. Join our free FB Group for more help.
I got a price to do a job from a subbie and quadrupled it. Client was happy, subbie we was happy, I was happy lol
Agreed with “ to be a good sales person “ we are always trying to run away of it
Thank you for this video, it really helped.
I appreciate you watching!
woow this really will help me now that l just start my small own drywall finishing business
Interesting facts about taking responsibility for ones own debts.
You are great and 100%correct
love this channel. i started a contractor business this year but have been working for others the last 18 years. finally went on my own, corporation, insurance licensed. we get jobs like $5000 here $10000 there but i just got this person who wants me to be his go guy. not just home improvement but building a home etc... its scary but i want to move forward. im still a little guy but what would be the best way to approach this? any thoughts or opinions is much appreciated. i work in NJ.
I know some contractors who do all the work their self but never factor in the COST of doing the Materials Shopping, The COst of MATERIALS HANDLING the COST OF Wear Tear and Maintenance on your Vehicles or equipment THINGS YOU WOULD BE PAYING FOR IF YOU BASICALLY SUBCONTRACTED WORK OUT So Those Are Also Costs To Factor In. And Like You Said That BUFFER ZONE Cost of overages in case ( HEY< If you wanna give money back to the customer when its all said and done thats on you BUT Thats also how you meat your years end bottom line.
Cool Uncle Tom we fighting the good fight contractors fight,!
Glad you're here. Thanks for watching!
Such helpful content! Wondering if the TIPS messages are still available? Cheers!
Hi Lepa, we've discontinued the TIPS by text message, but you can sign up to receive a weekly tip by email - sign up here: thecontractorfight.com/
Thank you for this video I've learned a lot since just started in this business
One more thing I feel I need to add here: his formula can be very situational. Like painting for instance, is 85% labor. You loose your ass if you follow this system. He writes off the going rate factor, but you should be knowledgeable of what going rate is. I basically beg people to get more than one estimate. As they should. And clearly state I’m not always gonna be cheapest. But I bring quality and communication. Those are often more valuable than money spent by most customers.
Thank you, just the way I do it
Good to hear
Quick question: So as a single owner operation, are you advocating calculating what I pay myself in the costs + 50% GP? or paying myself OUT of the 50% GP?
Not pushing back just wanting to be clear on the math. I appreciate the content, thank you!
50% directly for your company after you pay your self
Skynet acoustics
Hey this is rich from the obx nc I've stumbled on to your stuff a day or two ago and I've learned a lot already but have lots of questions so I'm trying to reach out to you if this the way to get to you I'm getting lots of leads currently from angie leads I've landed enough work in the last week to keep me busy for the next month or so but i still have appointments that are on all sorts of directions i need to know the best way to keep potential customers and how to keep them on the hook when you need to reschedule with them
Always ask when the customer needs it done. Charge accordingly. If you have the time will make you margin.
I recently started my channel related to construction estimating technology - tools, tips and tricks to make estimating using tech a bit easier
YOU MY GUY!! YOUUUUUUUUUU!!!!
The subject of this video has been knocked around my entire working life, now exceeding 50 years. He makes some good points, however your business might not be currently suited for this type of approach, or isn't there yet. What this approach will actually do is guarantee that you will either do well, or go broke. If you do well, you can preach like this dude. If you do poorly, you can blame it on somebody else, and start over. What I would take away from this presentation is for you to begin thinking about how you are going to position your business so you can get a gross profit of 50%.. Think about the statements made here and determine what you can do to get there. Don't just double your cost for a sale price, tomorrow. Another well known construction consultant starts out by saying "Decide how much money you want to make and ...... blah, blah, blah. That sounds great and everybody likes to hear that, but it is not that simple if you have a family to feed and no tolerance for failure. You have to take a more conservative but targeted approach. Folks, it really does matter what the going rate is in your area. You can get past that in time, but it IS relevant to most. If you are going to have a nice comfortable gross profit, you have to bring value..... not YOUR definition of value but what the customer perceives as value. If you have to succeed in construction, you can't start monkeying with the price without analyzing the value. It is good that this gentleman is talking about GROSS profit and not NET profit, and DIRECT COST and not INDIRECT costs. Those things bring on a whole other discussion which will vary so much that it is impossible to generalized with percentages and gain anything useful without using your own numbers to make decisions. I am retired now, so I no longer have a stake in this discussion at all. I'm not trying to sell anything... just share my experience as time and energy permits. But above all it is important to always be fair and honest to everybody. It doesn't matter that the customer is rich and trusts you so much that he will pay you whatever you ask for. For long term growth, don't take advantage of these people. The presenter talks about building trusts.... Overcharging people who trust you is counter to trust building.... just saying. I agree with most of what he is saying but you can get into trouble taking it at face value and making drastic changes in your price structure, unless you can afford to fail, and redirect your efforts.
Thanks for watching and weigh in in Glenn.
Great advice 👍
100% true!
Love the video!
Thank you so much for this video, my husband and I started our own Remodeling Company and I have been looking for estimating software that I can afford.. Which there aren't any! This helped us out alot.
Try an app called joist it works great
Route?
Hey thank you for your time to help people for what I understand but people I bid against don’t and they are working all the time but they aren’t making money now the Customer says to me hey your prices are crazy!! I say hey listen and listen good I’ve bin doing this for thirty years and in my 30 years I’ve figured out that you can’t work for free it doesn’t work . I’m not trying to under charge you nor over charge you I’ve bin there and done this so please when you ( the customer) hire the cheep contractor and he fails please don’t call me because it’s a little saying pay now or pay later. So please don’t cut your self short !!
great stuff!
i just started my small remodeling/roofing business and im having trouble with my quotes a i know that my quotes are good but some investors do not want to pay my price i think that they think that im a small business that they can get a full rehab for dirt cheap any advice for this problem
This is so good
Thank you for these videos!!
Price determines clientele not other way around
What about situations where you cant do the x2 method. When I install a front door, I might charge 250 on a door that costs 250, when the door costs 1000, but takes the same amount of labor as the 250 dollar door I cant get away with charging 1000 to install
You should try to be a little more clear in your communication. If your writing requires reading it twice to fully understand it you need to clean it up.
Regarding what you should charge you should watch the video again.
@@ThekiBoran thanks for the advice oh great one!
Any price on a prehung door?
I understood you. Not sure what the comprehension problem was on the other party's part.
I didn't see you put YOUR wage in the calculation before multiplying by 2. Profit is tacked on top of EVERY cost and goes to the company. Which in this case happens to be owned by you. But your wage/salary must be included as separate/part of the direct costs before profit is calculated.
So, if I’m on the job working with one helper, I pay him $20/hr, do I include my labor in the cost or do I take my labor out of the 50%? Thanks. For instance, would I pay myself $25-$30/hr as a carpenter plus his $20 so charge labor at $45-$55 hr plus materials and double that or do I take his 20/hr plus materials, double that and take my pay out of that?
Not sure what your overhead is but to use a markup of 2 you need to have high end clientele. Ive priced many jobs all high end and in the different divisions of my company I can get away with different markup. High end clientele we have a 42% gross proffit. Large building wide volume scale jobs are 35% these are seal bid jobs your pencils need to be sharp. Thats almost as low as you can go. With specialty service work we can get as much as 46%. I have tried to increase the proffit margin in this area but there is alot of pushback. But these margins are for a very large company. But the advice of knowing your math is sound. Know your bottomline dont go below it.
Over the phone Quote… I woulda charged you at least 900 $ for the cut. And I would have maintained it for 3 weeks on a day of your choice. Grew up in landscaping and I love it.
Do you recommend any books about Cashflow