10 Tips for Better Estimating

In my travels around the country, I’ve had the wonderful opportunity to talk with and work with thousands of remodelers. I often ask them what they use to estimate their jobs. The typical answer is that most of them believe they have the best system in the industry. The irony is that many have never really taken the time to look at (or at least haven’t looked very hard at) any other estimating systems. They are quite happy in using their own estimating system. If they have moved beyond pencil-and-paper estimating systems, they typically move to computer software. The typical enlightened remodeler believes (and believes with a passion) that the best software estimating tool is a simple adaptation of a spreadsheet in Microsoft Excel. Typically it is something they have built themselves. They tend to have a passion about their estimating system because they built it from scratch. Therefore, it is perfect. So how could it possibly be anything but the best estimating system in the industry?

Let’s talk a little bit about the average remodeling entrepreneur: a) Remodelers are usually highly motivated; b) Remodelers have a high sense of wanting to do high-quality work for their client; c) Remodelers are usually a very good craftsman; d) Remodelers are usually not very good record keepers; e) Remodelers are not as good as they need to be when it comes to running a business that makes a profit.

I work with and have worked with a lot of remodelers. And I’ve found that about 10 percent of them have been officially diagnosed with Attention Deficit Disorder. I believe if more remodelers were tested for ADD, the percent of those being diagnosed with ADD would be much higher than 10 percent! I believe that in order to be successful in this industry, an entrepreneur has to have a high sense of urgency in order to not lose their passion and desire for success in this very difficult industry. In this industry it’s much easier to get work, than it is to produce a profit on a job.

I would like to have you consider the following 10 best practices in helping you establish your best estimating system:

1. Offer estimates on a prospect’s schedule.

Here is a question for you to consider: Do you give free estimates or do you charge for them? If you read the industry publications, like Qualified Remodeler, you will hear a lot of statements like: “I’m a professional; the potential client has to treat me like a professional.” “I will only see people during regular business hours.” Or, “We don’t do any free estimates.”
Let me give you a little different slant as to what really goes on with people who make statements like these. Let me suggest that if you have determined that you want the potential client’s work and they want you to do their work that you meet with them on a schedule that works for both of you. In today’s economy, many of the remodelers who made statements like those above are either having to retract their words, or they’re work flow has been noticeably affected in a downward direction.

2. Understand how much time it currently takes you to prepare an estimate.

Have you ever thought about how much time it really takes you to put together an estimate? Do you use a checklist for each type of job you do? Have you ever thought of having a template for each type of job you build? What about the idea of having a “typical” bathroom or a “typical” kitchen or a “typical” addition? The idea being that you could very quickly adjust a “typical” drawing to reflect exactly what the potential client wants done. That way, you wouldn’t be as likely to miss the little things like the drywall or the gold-plated towel bars or the toilet. In any event, it takes time to put together a profitable estimate. How about this for an idea? Start keeping track of how long it takes to do one of your “typical” estimates. It just might surprise you to find out how much time it really takes. Hopefully the major reason that this is so important to you, is that your time is worth money, and you might think twice about giving away your time to do an estimate for someone who may not be serious about having you do their work.