Steve- PEC
Member
- Location
- Charleston, WV
What is the most cost affective method for pricing a new home when the customer/builder supplies the material?
common method of estimating new homes
- Thread starter Steve- PEC
- Start date
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Minuteman
Senior Member
- Location
- The Sooner Nation
Re: common method of estimating new homes
I have no clue. To me cost affective and customer/builder supplies the material are a contradiction of terms.
Steve- PEC said:
I have no clue. To me cost affective and customer/builder supplies the material are a contradiction of terms.
jwelectric
Senior Member
- Location
- North Carolina
I just ask them how much will you pay me to do it. If I don't like what they say I just don't show up for work.
memyselfandI
Senior Member
- Location
- Hampton Roads, Virginia
Customer is trying to dig into your profit. That is a tricky question, the best way that I can see is do it by the square foot. You got to kind of figure how much time it will take you to complete the job and adjust your rate. Don't give it away but don't gouge them either, you know what will happen then. 
bikeindy
Senior Member
- Location
- Indianapolis IN
I stopped even considering doing jobs that way. what I have found is that the homeowner is sure you will screw them on materials so they want to buy them and screw you on profit. they never have all the materials needed and then you are using yours to finish the job, and the homeowner is reluctant to replace your material. It is a bad way to do a job. I just tell them the price for me to do it is the same they can keep there material or return it I use all my own material. Contractors should know better than to ask.
bphgravity
Senior Member
- Location
- Florida
In this area, the builder tells the contractor what they are willing to pay and if the contractor doesn't like - too bad.
Every once and awhile you will get a custom / homeowner contractor that wants an actual bid and proposal. Even then, they already know what the maximum they are going to pay.
Every once and awhile you will get a custom / homeowner contractor that wants an actual bid and proposal. Even then, they already know what the maximum they are going to pay.
jeff43222
Senior Member
- Location
- Minneapolis, Minnesota
I'm glad I don't work for builders. It's much more fun to discuss and design with the homeowner. I explain options and give prices, and the customer then decides what they want.
As for the original question, I generally don't let the customer provide any materials except light fixtures and ceiling fans. It's not because I'm concerned about losing my markup profit. Rather, there's a good chance they will provide the wrong stuff, thus wasting everyone's time. If they have enough knowledge to buy all the proper materials, why do they need to hire me in the first place?
Sometimes, though, there are exceptions. I've had cases where the customer had a roll of NM they said I could use, or they said not to buy any switches because they were going to special-order vintage-style ones, but this kind of thing doesn't happen all that often.
As for the original question, I generally don't let the customer provide any materials except light fixtures and ceiling fans. It's not because I'm concerned about losing my markup profit. Rather, there's a good chance they will provide the wrong stuff, thus wasting everyone's time. If they have enough knowledge to buy all the proper materials, why do they need to hire me in the first place?
Sometimes, though, there are exceptions. I've had cases where the customer had a roll of NM they said I could use, or they said not to buy any switches because they were going to special-order vintage-style ones, but this kind of thing doesn't happen all that often.
Steve- PEC
Member
- Location
- Charleston, WV
I appreciate the comments! When I had my business in Charlotte, and all that we did were new homes, the builder would never provide the material, thus leaving us to get all that we needed.
My partner at the time figured the job by the square foot. Now that I am running my business in WV, there aren't a lot of new homes being built, but those that I have wired, the builder provides the material leaving me with figuring the labor. By the hour is okay, but most of the local electricains are doing it by the opening. This is new to me and wondered if anyone knew if this is accurate? Or what the average opening price is?
My partner at the time figured the job by the square foot. Now that I am running my business in WV, there aren't a lot of new homes being built, but those that I have wired, the builder provides the material leaving me with figuring the labor. By the hour is okay, but most of the local electricains are doing it by the opening. This is new to me and wondered if anyone knew if this is accurate? Or what the average opening price is?
I wire typical customs 6000 sf builder supplies cans, trims, lamps and fixtures, I supply the rest. 80 man hours and material has been averaging $2.25 per sf. 60% draw upon completion of rough and 40% at finish. all extras / openings is on change order. Note I do about 10 to 12 of these per year and this method has proven to be successful.
Re: common method of estimating new homes
I don't know how "affective" even applies?
Maybe cost "effective"?
(Oh no, the grammer police are back ! )
If the customer/builder/GC any one OTHER than you, the EC, buys the material...the only effictive way I see to price the job is T&M - as there is no "M", set a per hour rate and go with it.
You will no idea if they bought the right stuff until you go to install it...you're not going to check "inventory" for free, right?
So when you discover that there are no more single gang boxes - then what? Ok, start pulling wire - 3 days later, still no boxes but you drove out to the site anyway as they promised "the boxes will be here tom'row". Same story for wire - "what do you mean there's no 3-wire?" - "it'll be here tom'row".
So you finally get the thing roughed in and pass inspection and now it's time to trim out. What should take 1 - 2 days might take 3 - 4 days...why? "Someone" bought some crazy oddball fixture that requires you to read a foreign language or decipher blurry images of the install/assembly procedure.
"Someone" grabbed 3 boxes of device plates - one ivory, one brown, one white. Now you have to find out just what color they really wanted - and that's almond.
The list could go on and on.....and you lose money for every minute you are there rummaging around for parts or on the phone with "someone" who makes the "decisions".
So the thing finally gets done....and now an item breaks - who gets the call to fix it? You do ...and unless you make it clear that you are not responsible for the "warranty work", you get to do it for free
....we haven't even discussed changes/additions/moves.
So, I say - pick an hourly rate and see what they say.
Steve- PEC said:
I don't know how "affective" even applies?
Maybe cost "effective"?
(Oh no, the grammer police are back !
)If the customer/builder/GC any one OTHER than you, the EC, buys the material...the only effictive way I see to price the job is T&M - as there is no "M", set a per hour rate and go with it.
You will no idea if they bought the right stuff until you go to install it...you're not going to check "inventory" for free, right?
So when you discover that there are no more single gang boxes - then what? Ok, start pulling wire - 3 days later, still no boxes but you drove out to the site anyway as they promised "the boxes will be here tom'row". Same story for wire - "what do you mean there's no 3-wire?" - "it'll be here tom'row".
So you finally get the thing roughed in and pass inspection and now it's time to trim out. What should take 1 - 2 days might take 3 - 4 days...why? "Someone" bought some crazy oddball fixture that requires you to read a foreign language or decipher blurry images of the install/assembly procedure.
"Someone" grabbed 3 boxes of device plates - one ivory, one brown, one white. Now you have to find out just what color they really wanted - and that's almond.
The list could go on and on.....and you lose money for every minute you are there rummaging around for parts or on the phone with "someone" who makes the "decisions".
So the thing finally gets done....and now an item breaks - who gets the call to fix it? You do ...and unless you make it clear that you are not responsible for the "warranty work", you get to do it for free
....we haven't even discussed changes/additions/moves.
So, I say - pick an hourly rate and see what they say.
- Location
- Massachusetts
You all should try working for the big retail chains. :lol:
They provide panels, contactors, lighting, fire alarm, sometimes devices etc.
The job I am doing now is for a national chain they supply everything but the pipe, wire and labor.
The electric room came pre-assembled on a truck and was put into place like a piece of furniture. :roll:
Truck loads of stuff comes in that you have no idea what to do with as you did not order it.
They provide panels, contactors, lighting, fire alarm, sometimes devices etc.
The job I am doing now is for a national chain they supply everything but the pipe, wire and labor.
The electric room came pre-assembled on a truck and was put into place like a piece of furniture. :roll:
Truck loads of stuff comes in that you have no idea what to do with as you did not order it.
- Location
- Massachusetts
celtic said:iwire said:
How many tons of re-loc?
:lol:
Not to much on this job, still enough to be a pain.
It is in my spec that I can not run anything but EMT, however the re-locs run all over the place.
It would have been nice if someone thought to include the layout so I knew which length whips are planed for which circuit.
They are drawn on the print 'as the crow flies' and I bet that is how the salesman supplied them.
The 22' power poles they supplied looked like junk right off the truck. Shipped loose no crate and you know the truck drivers treated them gentle. :roll:
macmikeman
Senior Member
- Location
- Planet macmikeman
I do some new houses for a GC that builds package homes supplied by a large lumber company. They provide the panel and breakers and all trim out stuff. The first one I did for them, they did not make it clear that they were going to supply me those items, so I bid it at regular terms. No one said anything. So I did it again, and again, and again. Still going after more than forty of them. Last 2 years I have been raising his prices because of copper/ gas/ life going up, and they are cool with it. It actually only balances out, because that GC is a scheduling nightmare. I gave him the nickname "any second Roy" because any second now Roy will be calling with another last minute schedule request.
larryl
Senior Member
- Location
- wrentham ma.
how else can you do it,but by hourly,,,agree on an hourly price with the guy with the check book,
i know you got to give him some sort of time frame,,give him an idear of how long it's gonna take ya,,then add some hours for wrong material,not enough material,,ect.
he's already digging into your profit by getting all the stuff himself,,
how i've done it in the past for family and friends is,,you make a huge stock list,call it into your supplier,and have him pay for it & pick it up,and bring it all into the house himself,,if he wants to supply it,then let him supply it,and hump it all in the house too,,
then get a check every couple days,,even better,get three or four thousand and work off that,BUT MAKE SURE YOU GUYS AGREE ON AN HOURLY RATE,,sorry for the caps,but i just wanted to stress the point,,
hope ya get the job,,
i know you got to give him some sort of time frame,,give him an idear of how long it's gonna take ya,,then add some hours for wrong material,not enough material,,ect.
he's already digging into your profit by getting all the stuff himself,,
how i've done it in the past for family and friends is,,you make a huge stock list,call it into your supplier,and have him pay for it & pick it up,and bring it all into the house himself,,if he wants to supply it,then let him supply it,and hump it all in the house too,,
then get a check every couple days,,even better,get three or four thousand and work off that,BUT MAKE SURE YOU GUYS AGREE ON AN HOURLY RATE,,sorry for the caps,but i just wanted to stress the point,,
hope ya get the job,,
77401
Banned
Larryl is correct.
Part of being a good contractor is being able to read & understand people.
What can you read about someone not in the industry, that wants to supply materials?
1) he wants to save money & cut you out of your markup.
2) he want to be nice and save you time & gas going to get materials & returning materials.
A guy like this is looking at every penny. Whether he's chaep or can't afford this doesn't matter.
Tell him your fast, & ask him about an hourly rate.
For these people I ask them what would they like to pay per hour. Explaining that on a bid project I have every bit of motivation to step up the speed, get in & get out fast! By the hour I have less motivation to hurry as I'm working my self out of a job with every twist of a wire nut. If they are really interested in a low hourly rate then I'll offer them a half priced hourly rate. Then I'll send my slowest apprentices with some helpers hired off the corner, tell them not to hurry, and I won't supervise the job.
Can you guess which job I make more money on & how much the owner saves?
Part of being a good contractor is being able to read & understand people.
What can you read about someone not in the industry, that wants to supply materials?
1) he wants to save money & cut you out of your markup.
2) he want to be nice and save you time & gas going to get materials & returning materials.
A guy like this is looking at every penny. Whether he's chaep or can't afford this doesn't matter.
Tell him your fast, & ask him about an hourly rate.
For these people I ask them what would they like to pay per hour. Explaining that on a bid project I have every bit of motivation to step up the speed, get in & get out fast! By the hour I have less motivation to hurry as I'm working my self out of a job with every twist of a wire nut. If they are really interested in a low hourly rate then I'll offer them a half priced hourly rate. Then I'll send my slowest apprentices with some helpers hired off the corner, tell them not to hurry, and I won't supervise the job.
Can you guess which job I make more money on & how much the owner saves?
hardworkingstiff
Senior Member
- Location
- Wilmington, NC
77401 said:
I believe it would be more honorable to walk away from this guy before doing the above.
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