what am i missing on estimating?

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bullheimer

Senior Member
Location
WA
last bid i was lowest bidder. i had contractors calling asking if i knew i was less than half of the bids they got already. (i still didn't get it cause the winner was the buddy of the gen)

this time i was at 130K and the lowest bids were 82 and 90K by UNION contractors. my material costs were 62K alone. a 4 story ware house 100% 3/4" rigid pipe and waterproof everything. i saw 644 hours because there was another 1 story 3000sq ft building and about 15 parking lot lights on 30 & 40 ft poles. at $75/hr for a jman ( my shop rate) and $20 for a helper times 644 it was about 60K for labor.

if you deduct just the COST of 62K from the 82K bid, you get 20K. at 50/hr that is 400 hours.

okay enuf griping, anybody know if a ibew contractor can bid labor at 50/hr? should i NOT be bidding my labor at 75/hr? the low bid i put in was a rigid job i bid at 75/hr as well. i was on the higher end of all the bids this time. i used a friends high dollar program (just for labor on installing rigid, NOT for the whole job) and it says 3.5 hours to run every ten feet of rigid from a light to a switch on cement. seems way too long, but if you figure in threading and screwing it together, drilling cement for anchors, measuring where your going to keep everything square, it doesnt seem that terribly out of whack does it? i guess if i would have bid it at one hour for a ten ft stick i would be closer to the 400 mark, but still, at that price, they would have made ZERO markup on material!! thats not right is it??? sign me, a sign of the times i guess
 
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bullheimer

Senior Member
Location
WA
you're right. i just found out about the unions "economic recovery fund" where they'll pay a contractor like $20k to make sure they get the bid. the money comes out of everybodys paycheck that's a ibew worker
 
Fulthrotl

Fulthrotl

~Autocorrect is My Worst Enema.~
Location
HB, CA (19 Hrs. 22 Min. from Winged Horses)
Occupation
E
bullheimer said:
you're right. i just found out about the unions "economic recovery fund" where they'll pay a contractor like $20k to make sure they get the bid. the money comes out of everybodys paycheck that's a ibew worker
Click to expand...

it's been around fifteen years in this area.

they pick a job they want to get, and the contractor cuts it tight, and the
union agrees to make up the difference to achieve a smoking low bid....
the contractor bidding the job figures out what a "nuts" bid would be, and
the local agrees to back stop him if he gets it.

he bids it lower than he can afford to, shoots you out of the saddle, and
for $10k, they have taken $200k in work from you.

the only way you can get the job is to go broke doing it.
or to walk down to the local unions office with a pen in hand, and
become signatory, and sign up for the program.

welcome to todays lesson in collecive bargaining, or pack hunting, whichever
term you prefer.:D:D


randy
 
C

Cow

Senior Member
Location
Eastern Oregon
Occupation
Electrician
bullheimer said:
i used a friends high dollar program (just for labor on installing rigid, NOT for the whole job) and it says 3.5 hours to run every ten feet of rigid from a light to a switch on cement. seems way too long, but if you figure in threading and screwing it together, drilling cement for anchors, measuring where your going to keep everything square, it doesnt seem that terribly out of whack does it?
Click to expand...

Holy smokes, if my boss found out it took me 7 hrs to run 20' of 3/4 rigid I'd be lucky to still have a job. I would think around an hour or so is more typical by the time you figure adding fasteners, picking up material, bending, threading, etc but that's just a guesstimate.
 
Fulthrotl

Fulthrotl

~Autocorrect is My Worst Enema.~
Location
HB, CA (19 Hrs. 22 Min. from Winged Horses)
Occupation
E
bullheimer said:
i used a friends high dollar program (just for labor on installing rigid, NOT for the whole job) and it says 3.5 hours to run every ten feet of rigid from a light to a switch on cement. seems way too long, but if you figure in threading and screwing it together, drilling cement for anchors, measuring where your going to keep everything square, it doesnt seem that terribly out of whack does it?
Click to expand...

it depends on where you are running it, obviously. ocal in a refinery with no
hot work permitted, meaning you drive a half mile to the conex for each
cut and thread, or a factory where you are in there at night on a lift, that's
something else entirely.

now, i'm famous for saying i can do something in 2/3 the time it really takes,
so i called my friend mark, who does tons of rigid, and asked him how much
footage a day, in 3/4" gal, with backstraps on concrete walls, 4sd j boxes,
cut and threaded, no unions, no threadless, spin it up. red head anchors on
everything.

he says 150' to 200' a day. 8 hour day. i agree. maybe 250' a day if you are
able to smoke along, but to bid it, call it 175' per 8 hours.

then i said what about 10' in 4 hours.... 20' a day.... and we both started
laughing..... honest to god, if anyone showed up to work for me and did
10' in the first four hours, the second 10' would be their last.....:D


randy
 
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benaround

Senior Member
Location
Arizona
bullhiemer, I don't know too many shops that bid labor at the 'shop rate'. They have what

it actually costs to cover a j-man or apprentice for 1 hour, then when all the labor units

are totaled they add a % on top for the profit. Parts are parts, unless you miss some big

items the estimated parts prices are pretty close for the most part.

Now, if the job produces C.O.'s for you , the 'shop rate' is charged out. JMO.
 
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wawireguy

Senior Member
It could be as simple as the low bids were ones from companies that are going to add on a lot of costs. Perhaps they have figured out how to bid low and leave things out then add them in later? I hear about contractors doing things like that all the time.
 
S

SEO

Senior Member
Location
Michigan
Bidding has always been been a game of cat and mouse but with the economy the way it is contractors are desperate and are doing more creative estimating than ever. No rhyme or reason sometimes.
 
Mr. Wizard

Mr. Wizard

Senior Member
Location
Texas
benaround said:
bullhiemer, I don't know too many shops that bid labor at the 'shop rate'. They have what

it actually costs to cover a j-man or apprentice for 1 hour, then when all the labor units

are totaled they add a % on top for the profit. Parts are parts, unless you miss some big

items the estimated parts prices are pretty close for the most part.

Now, if the job produces C.O.'s for you , the 'shop rate' is charged out. JMO.
Click to expand...

benaround, would you mind eleborating a bit on that? Would a shop rate be similar to service rates? For my little shop I have a set rate to come out and do service calls, but to bid, I use a lower rate. I've always heard that's the way it is, and I've come up with my own numbers for both contract and service. But, if my thought process is costing me money, please chime in and and correct me of my ways!
 
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benaround

Senior Member
Location
Arizona
Mr. Wizard said:
benaround, would you mind eleborating a bit on that? Would a shop rate be similar to service rates? For my little shop I have a set rate to come out and do service calls, but to bid, I use a lower rate. I've always heard that's the way it is, and I've come up with my own numbers for both contract and service. But, if my thought process is costing me money, please chime in and and correct me of my ways!
Click to expand...

You are doing it the same way I was describing !!
 
J

JES2727

Senior Member
Location
NJ
Fulthrotl said:
the only way you can get the job is to go broke doing it.
or to walk down to the local unions office with a pen in hand, and
become signatory, and sign up for the program.
Click to expand...
Well, yes. That's the whole point. But it's not a "program", it's an organization created to improve the quality of life of it's membership.

Fulthrotl said:
next weeks fun filled lesson is entitled....
"salting... proper seasoning for dinner, when you are the main course".....

bon appetite....:D
Click to expand...
Are you just trying to start an argument here? Do you think it's beneficial to the forum to antagonize the union members?
 
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ishium 80439

Senior Member
Location
Denver foothills via the Horn of Africa
Let's veer away from union/ non-union and back to the OP before this gets locked.

When pricing service you have to account for the fact that your staff will not be on the job for 8 billable hours. There is also travel time etc that is built into a service rate. When bidding a job of any significant duration you will have people on the job for 8 hours a day for several weeks or more. There is no down time, travel, mobilization, de-mob, hauling bits of material etc (obviously this is a bit simplified for demonstration sake). In that scenario you need to price your labor on wages plus burden. On top of that you tack on O&P.

I am certainly not an estimating guru but this is the best way I can answer your question.
 
celtic

celtic

Senior Member
Location
NJ
ishium 80439 said:
When bidding a job of any significant duration you will have people on the job for 8 hours a day for several weeks or more. There is no down time, travel, mobilization, de-mob, hauling bits of material etc (obviously this is a bit simplified for demonstration sake). In that scenario you need to price your labor on wages plus burden. On top of that you tack on O&P.
Click to expand...

Granted, it a bit simplified...over simplified, IMHO....any job of significant duration will incur demob/mob. charges ~ especially when we are talking RMC and heights.
 
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cdslotz

Senior Member
$75.00/hr shop rate?
Our average "shop" rate is $19.50/hr top to bottom. Add 35% for burden and that comes to $26.33/hr raw cost. I bid jobs using this average rate, hopefully we can build the rate cheaper than what we bid. If it's only a 2 man job I will use a higher rate.
So I would bid your job like this (assuming your material has tax and rental equip)

Mat $62,000.00
Lab 644 hrs x 19.50x1.35=$16,954.00

Subtotal cost=$78,953.00
OH&P @ 25%=$19,738.00

Total job = $98,691.00

Your mileage may vary in your area.
 
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hardworkingstiff

Senior Member
Location
Wilmington, NC
One thing to keep in mind, you should be able to have better production if you are on a larger job. This should lower the overhead rate on your people. I think you are up against savvy contractors that are willing to work to cover 90% (or 80%, 75%, etc) of their overhead than none of their overhead.

Like I've said for months, it's going to be difficult for a while. Small shops and one man operations (like me) will have to be satisfied with making wages (sometimes not so good) and larger shops will have to hope to cover a large portion of overhead and stay in business long enough for things to get better.

It's been a great 4-years for me (and I assume most of us). I hope you put away a rainy day fund (it's sure raining for me).
 
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