Notes taken from an AISC Steel Conference session. Material by Hillsdale Fabricators.
Types of Estimates
- Lump Sum
- Design Build
- GMP = Guaranteed Maximum Price
- T&M = (know what your costs really are!)
Go vs. No-Go Decision Process
Rate each bid opportunity on a scale from 1-10.
Compare and rate each bid opportunity to past jobs.
Two stages of decision.
- Data collect
Review the following:
- Immediate Factors
- Is this a “real” job? Will it happen. Is it a legitimate opportunity. Are they just kicking tires?
- Are there less than 7 bidders?
- Heaviest Weight Factors
- Cost to pursue the bid
- Historical success at this type of project
- Design Team involved
- Drawings, are they complete?
- Resources available. Estimating, PM, detailing, fabrication, etc.
- Impact on other bids and current jobs
- Medium Factors
- Understand the client needs
- Who are the contractors bidding
- Light Factors
- Can the client/owner pay?
- Does the contractor pay?
- Relationship with the bidding contractor(s)
Estimating Team Leader
- Determines bid strategy
- Estimate checklist
- Delivery timeline
- Proposed format
- Units & quantities
- Get drawings & specs to the right people
- DBE/MBE requirements
- Sales Tax requirements
- Final Estimate Summary
- Archive Estimate (after completion)
- Bid delivery execution strategy
- Initial all pages taken off.
- Supplier/sub coordination & analysis
- Preliminary construction schedules. Can you meet the time line?
- Bid delivery timeline
- Have two bid runners
General Practices and Successful Methods of Estimating
- Understand the scope and project
- Computer programs and drawings
- Subcontractor, supplier and material evaluation
- Scope letters. Detailed and sent early.
- Rules of thumb. Have rule of thumb guidelines to follow and for double check.
- Things to remember
- Profit & overhead
Understanding the Scope
- Read the ITB and/or RFP
- Review the documents
- Review general conditions and supplemental conditions
- Scope reviews
- Transfer to operations
Scope Should Contain
- Contract & terms
- Project name
- Scope of work
- Qualifications, inclusions, exclusions
- Contact info
- Identify if sales tax is included or excluded
- Address proposal to the customer
- Be available for questions
Rules of Thumb
- Book of means
- Pounds of steel per square foot
- Cost per ton
- Cost per square foot
- Make time for in-depth review
- Look at the forest and the trees
- Look at individual parts versus the whole project
- An estimate is only as good as the time spent on it
- Large print giveth, small print taketh away.
- Low price or the right price?
- Relationship or commodity? What is the bid based on. You don’t want to be a commodity.