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So you’ve taken the leap into commercial plumbing jobs and need to learn how to estimate plumbing jobs. The kind of jobs where you need to put together a real deal comprehensive quote, not just a standard contractor estimate.
This is a lucrative and rewarding approach to winning new business, but not without its headaches. And often, those headaches start during the estimate process.
You’ll be potentially dealing with construction managers, developers, architects, CEOs, electricians, and more – and that’s before you even win the job.
While some basic estimation skills carry over, producing accurate estimates that secure your next job requires estimating software that captures every detail.
This guide will help you understand how to create a detailed estimate, while highlighting how plumbing estimating software is the only solution moving forward.
The invitation to bid, or ITB (sometimes abbreviated as IFB for “invitation for bid”), is just that: An invitation to propose why your plumbing services beat out your competitors.
In general, a client seeking an invitation to bid for plumbing will want a fixed-price contract with service businesses like yours, though you are welcome to (and should) bake in price adjustments based on expected variables.
Similar to the ITB is the Request for Proposals – or RFP.
Compared to the ITB, an RFP is more general: There’s a task that needs to be completed, but the person making the RFP figures out the precise parameters. Therefore, one outcome of an RFP is a cost-reimbursable contract. This is one of the few times that clients expect some wiggle room for pricing, materials, and scope. The ITB, on the other hand, usually results in a fixed-price deal, even if it contains options like price adjustments to account for inevitable holdups and variables.
Regardless of the estimate type you’re developing, plumbing contractors must include elements that outline the total scope of work.
This should include cost and material estimates, estimates for crew and labor, relevant project experience, and a pitch explaining why your plumbing company is perfect for the job.
Because estimates are done for free and without the guarantee of payment (in some cases a lot of work, as highlighted in the considerations below), it’s important to understand exactly what potential clients expect.
For example, plumbing businesses that create estimates must adapt their processes for complicated government bids to a simple oral pitch.
You must sell your professionalism, experience, and ability to complete the job. Plumbing companies must also convince the client you can do it within their budget and on time. And you will have to complete the bid in a timely manner – with either enough precision or enough budget flexibility – so that you come out in the black.
This guide assumes a bid on the higher end of the complexity scale, so if your ITB is less complex – great. These questions can still help you polish your pitch while your top-notch business processes will bring the contract home.
Material pricing varies depending on the type of construction (new or existing structure), as well as what the client is looking for. Is it a high-end construction with all the bells and whistles or more of a penny-saver?
Will they be looking to you to get the best quality materials or to consult on what the best materials within their budget are? Will the materials the client wants you to use require special tools and/or expertise to install?
These minor variables add up to additional costs if you don’t have the answers up front. Therefore, ask the right questions to create estimates that expertly detail a plumbing job.
Next, you need the right crew to complete construction projects that you win. Based on the parameters of the bid, you’ll need to price out per head, then add extra for profit and unexpected circumstances.
These project costs get pricey fast without a clear idea of what the job entails. How many master plumbers do you need supervising apprentices or helpers? How much is that going to cost per head per hour?
You need an overall plumbing hourly rate for every member of your crew at each skill level (which you can amalgamate into an aggregate rate if you want).
Make sure your plumbing business researches this information and factors it into your estimate to maximize profit and avoid budget overruns.
Finally, the pitching piece is one element that plumbing contractors often overlook. As other plumbing businesses are likely bidding for the job, show that you’re hungry, you’re qualified, and that you stand out from other contractors angling for the job.
While you don’t want your proposal to be overly long, it must thoroughly outline the strengths of your entire business. Think of it like a job interview, because that’s what it is. You’re interviewing for the job you want to win from the client.
For potential clients that require just a letter of intent or oral bid, it’s still a good idea to do a light version of this process for your own estimation’s sake. But in those cases, the self-sales aspect is even more important. You only get one chance to impress and win the job.
So that’s what’s generally contained within your plumbing bidding document, but how do you determine exactly what you need to make intelligent estimates?
For that, you’ll need a full set of plumbing blueprints alongside general blueprints and plans for the entire project.
That might seem like an unnecessary extra cost, but there are often discrepancies between the architectural drawings and the plumbing outlines.
Field service management – especially involving new construction – means a lot of cooks in the proverbial kitchen. Therefore, the ability to compare blueprints helps ensure a seamless customer experience.
Furthermore, it’s critical you see the architectural drawings, since these supersede any other drawings and blueprints in terms of authority.
Trade drawings are the lowest order from a legal standpoint, so if you don’t check the work you’re going to perform against the expectations in the architectural drawings, you could be on the hook for the discrepancy.
On the whole, you’ll likely want a copy of the site plan, architectural drawings, and construction drawings with general notes and conditions. Plus, mechanical drawings and demolition drawings (if applicable), besides your plumbing drawings.
This way, plumbing contractors have everything they need to create an estimate based on reality.
A quick note: Obviously, all of this printing can add up quickly, but in some ways, that’s a good thing. The hurdle of obtaining and printing these drawings should give you pause to only go after those contracts you’re seriously qualified for. That way, no one’s time gets wasted.
Now that your business effectively has all the plans it needs, create a plumbing takeoff and pricing sheet.
A takeoff is a precise estimating tool that accounts for the materials you need for the job. Plus, this resource outlines workers required, special limitations, and more.
With the plumbing blueprints in hand, look over the plumbing notes section to see what the architects have in mind for your estimate. This is likely incomplete, as these folks aren’t plumbing professionals and might overlook key features and considerations.
Take notes as you develop your estimate. This will not only help you in the long run, but prove your professionalism and great customer service to a potential new client.
A tried-and-true method for working on your takeoff is to use colored pencils on your printed plans to measure and label all the runs of pipes, fittings, and other equipment you’ll need (sinks, fixtures, sprinkler parts, etc.). Measure the lengths you’ll need and plug your calculations into your cost estimator.
Takeoff software helps plumbing contractors complete this task far quicker. In fact, there’s even cloud-based takeoff estimating software that handles many job management concerns for you. For service professionals looking to rise above the competition, use leading estimating software over the outdated pencil-and-paper approach.
During this process, be aware of anything in the plans that seems out-of-the-ordinary. Special sensors, custom fixtures, and non-standard materials are just a few.
These could require a specialty contractor to install, so it’s critical to identify these items for review with the client. You are also more than welcome to ask them about specialty contractors during the estimate process to build in variable pricing upfront.
What you identify in your takeoff will also shape your pricing estimates, not only for materials and trade contractors, but also equipment rental costs to complete specific jobs.
Take all the materials you’ve marked up and put them into a spreadsheet where you can price the inventory, labor, and other associated costs individually. This is where you will build in your profit margin and slush to cover for unexpected and inevitable cost overruns.
On large building jobs, one great piece of advice is to add a two percent increase in labor costs for each floor above the fourth.
Finally, with your takeoff and pricing sheets in hand, you’ll need to answer the question of what kinds of general contractors you’ll need for the job.
Based on the work you’ve identified in your takeoff, make a list of the general contractors you’ll need to engage with and reach out to, so you can get their rates and make them part of your estimate.
If you don’t have time to do that or it overcomplicates the estimate process, take your best guess and try to bake in any potential extra costs.
As you finish your takeoff and labor units, compare the plumbing drawings you’re marking up against the architectural and mechanical drawings. The goal here is to catch anything you might have overlooked.
It’s a good idea to get a fresh pair of eyes as well. Grab a fellow worker to look at your estimate and try to spot any discrepancies between the drawings that need clarification or present unique challenges.
Despite the surprises that can occur in material or labor costs, those parts are easy. What’s harder to account for are all the side expenses that complicate project management for small companies.
First off – plumbing. While many big job sites simply rely on port-a-johns, others will have temporary toilets installed for the crew. Are you expected to get these online or build them? If missing from the proposal, consider these costs to quote accurate prices.
Speaking of temporary installation, it’s possible you will need to do temporary pipe runs or water boosting for other work done on-site. This might not be accounted for in the service agreements, so raise the question with the client.
Then there’s accommodation. If the project is big enough, do you need to rent a trailer so you have adequate organizing and office space? If not, will the client provide one for you and your crew? Logistics are critical to smooth project management.
Ditto considerations about parking (is there free parking nearby? do you need to pay for space?), truck rentals for the job site, union costs, and cleanup costs. A productive worksite needs an affordable solution.
Finally, consider the needs of local regulations on your crew. What are the costs of permits and licenses you might need? What are the costs of taxes on work and materials? Is free training possible?
Yes, we’ve asked how many master plumbers you need, but also what kind of safety training does your crew require? This can cost the whole company money, both in time and in certification.
Building in budget for when stuff breaks might sound like fluff, but it’s an important and smart part of your job estimates. Tools break. Sinks shatter. Fixtures get bent. Workers drop materials.
These things happen on multi-stage projects. A busy job site means lots of variabilities and that inevitably leads to things breaking. Bake a percentage into your inventory management costs to enhance business profitability.
Once you’ve put together your most comprehensive estimate for the job, add three percent on top. This is your wiggle room to preserve profit in the face of unexpected costs, labor units and changes.
Besides being the average margin of error on plumbing contractor estimates, this percentage takes care of your professional needs while not being so high it offends the client. Everybody wins.
This is the bidding version of “measure twice, cut once.”
Because your field service estimate outlines your most affordable solution – and the precursor to a legal contract – it’s imperative that you double-check your numbers before submitting.
Have a trusted pair of eyes (or two) at the office review your estimate before it gets sent to catch any glaring errors. Like many mistakes on the job, this one that could cost you money.
Your estimate is crucial to construction management, so why rely on the pencil-and-paper approach? Nowadays, small companies and self-employed persons can use sophisticated plumbing estimating software that removes the guesswork from this process. This web software offers precise quoting while also elevating your job scheduling and customer management.
FieldPulse is the leading plumbing estimating software. Our comprehensive software platform means those operating in the service industry can swiftly produce clear and detailed estimates that provide great customer service and help manage projects with greater clarity. Alongside key features for remote support, our all-in-one solution lets a construction company take charge of their plumbing estimating software.
Using our field service management software, plumbers can group items inside their estimates while hiding items, like material costs, from customers. You can automatically quote accurate prices for materials using our management software, based on square footage, job duration, or timesheet totals.
Our advanced mechanical estimating software also generates and sends estimates from inside the app, promoting customer relationship management while streamlining how industrial contractors handle their bid management responsibilities.
The first bids on big plumbing jobs are the hardest because you’re doing the most work from scratch. This is where plumbing estimating software like FieldPulse boosts the bidding process, alongside the day-to-day operation of your company.
Our comprehensive estimating software tracks exactly which employees you have available, as well as their skills and rates. Plus, FieldPulse’s detailed database means our digital solution functions perfectly as material estimating software, too.
All of that makes your takeoff easier to execute more quickly and accurately. If your field service business is ready to discover the difference, start a fully-featured 7-day free trial today.
