Masonry Magazine April 2011 Page. 37
our children and our children's children say of us we justified our brief moment here. We did all that could be done."
And, at a Dec. 8, 1987, joint press conference with Soviet leader Mikhail Gorbachev, when discussing the outcome of a nuclear arms limitation treaty, Reagan came right to the point: "Trust-but verify!"
Gorbachev then reminded Reagan, "You repeat that at every meeting!"
Finally, there is a take-away from today's lesson, and it is two-fold. First, in the midst of all of the economic carnage we see today, lack of work, crew layoffs and zero-profit bids, many of us may be tempted to wonder what the use is. For many of us, business stinks right now, and this is why I urge that you take to heart the encouraging words of our 40th President. Other people have experienced misery the same and worse and came out of it. Our mission these days may simply be to hang in there another month, and then another, and then another.
Resolve that, especially in this crisis, regarding developers, clients, homeowners, agencies, construction managers and general contractors who ask us to "take care of their problems by providing that which initially was never in the plans and specs, promising to see that we get paid for it in the end, remember to "Trust - but verify!" IMAS
Gary Micheloni is a working project manager, speaker, author, consultant and coach. White him at FullContactTeam@gmail.com.
Copyright 2011 Gary Micheloni
COACH GARY'S CORNER:
Coach Gary's Comer: Public works on your mind for 2011? Learn the best way to "Trust - but verify!" Coaching will help you get there in less time, and with more success. Want to try and get Coach Gary to speak for your group? Go to www.FullContactTeam.com, and click on the links for the resources (below the arrows). The report is free. And, get free scheduling help from www.MicrosoftProjectClasses.com, so you can enter public works contracting. Go there now.
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When you Price Work, do you Estimate or Guesstimate?
CONTRACTOR TIP OF THE MONTH
We all can agree that it's tough out there right now. If you do get a job, you better have an accurate bid or risk losing your pants. Oh, we can all wish for the good old days, when estimating was easy and work was abundant. You know what I am talking about: when you could put a material and labor summary together, fatten it up in case you missed something, add in equipment and overhead, throw 20 percent on top of it because you were too busy to do the job anyhow, post the bid and still get the job. Guess what? Those days are gone forever. We cannot survive going forward with a guesstimate. In today's business climate, you've got to estimate, not guesstimate. Here's how you do it.
Know your exact cost
If you expect to win a job, you must know what your actual costs are for labor, field overhead, equipment and office overhead without guessing. Then, add exactly what profit you expect to earn on the job. And, let's not forget accountability. When the job is finished, the estimator should be held accountable for the profit being really close to what he put on it bid day.
Never trust anyone's estimate but your own
I had a contractor come to me once for advice on pricing his work as he was struggling to make money on his projects. I asked him how he currently was doing his estimates. He replied, "It's easy, I have such a good relationship with the GCs that they give me the number and I do the work for that price." (If you were the GC, wouldn't you love that relationship too?) The first lesson he got was to never trust anyone's number but his own, if he wanted to stay in business.
Utilize technology
If you aren't using some of the latest estimating/job management computer systems, you already are way behind those who use technology to build their estimates. Before we post any large bid, the estimator shows us a complete 3D rendering of what the job looks like. We compare it to what we see on the prints. As a group, we look at the finished appearance, determine unit prices based on the complexity of the project compared to similar projects we have built in the past, and make sure he isn't adding too much in or taking too much out, so our odds of getting the job improve. On bid day, up to five of us may be scanning documents and prints to ensure we have an estimate and not a guesstimate. If something was missed, one of us most likely finds it in the final hours before the bid goes in.
Future bidding
I believe that engineering and estimating technology has become so advanced that, in a few years, owners and GCs will be sending us the take offs with all the unit/pieces already broken out. All we will do is fill in the price per unit of work that needs installed, and that will determine our bid. If that holds true, the only survivors will be those who know exactly what it costs to install every single unit in their scope of work. So, you'd better start intensely measuring jobsite production down to each unit installed.
By truly estimating, rather than guesstimating, you can know when to say "no." We all know there are times you take a job for less than you would like (or as I call it, bone one) to keep your people busy. When you bone a job, make sure you only cut to the bone, and no deeper. The bone is your actual costs that go into that project. Then, when your customer asks you to do it for less, you can say "no thanks" with confidence as you know your costs.
Damian Lang is a mason contractor in southeast Ohio and inventor of many labor-saving masonry systems and products. He is also the author of the book "Rewarding and Challenging Employees for Profits in Masonry." To order a copy of his book, or to network with Damian on these tips or tips you have and would like published, contact him at diang@langmasonry.com or 740-749-3512
Provided by Damian Lang, President of Lang Masonry Contractors, Inc., and EZ Grout Corp.
READER SERVICE #314
April 2011
MASONRY 35