How to efficiently estimate a job!!

wyoclimber said:
One of the biggest challenges I've had as a business owner is learning to let go of things. I too want to get EVERY single job... even if I don't really want to do it. I guess it feeds the ego. A couple of things that I have done. I build in extra time on those big removals. Many four larger removals are cottonwoods with significant rot and hazards. I add at least 25% to what I think I can do it for. I'll be honest with people about that. I don't want to put myself in a situation where I do something that I only THINK will work because I'm rushing to get it done at my underbid price. If somebody else wants to brag that they do the fastest removals in town, go for it, I do the safest ones.
Pruning is far easier to sell. I write job specs and often send pictures with the scope of work drawn on. It's easy to sell quality of pruning and easy to show the difference between my pruning and the next guys.
I had an entrepreneur tell me once that if you are estimating correctly, you should only be getting 30-40% of the work you bid on. I'm sure those numbers will be different based on your market but the point is, you'll never make it bring the cheapest guy around and you'll never get every single job if you aren't.
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I agree. I am a member of a referral based business group and in one of the meetings they talked about that. A good estimater only gets about 30-40 % of the jobs they look at. I guess the issue is to just make sure your looking at enough to keep everything going!!
 
I think I only get 60% of the jobs I bid. I am in a highly competitive market with a wide variety of "levels" of tree services around. I learned long ago and still try to stick to it to this day, know to the dollar what you need to get per hour/per guy. Calculate out what you need per guy based on their pay etc. Also equipment on the job, if you have an older bucket thats paid for like me that might be worth (x) amount per hour. If you just financed an 80 or 100K new truck then thats probably billed out higher when out working. Either way, know what you need to get and stick to it! I agree with what someone said above, it depends on the customer. If its a shit job, where i'm one of 5 companies bidding on it and I know they will take the lowest price then so be it. If its a referral and a customer I know I can get and keep for life I might bend within a couple hundred bucks to get it. The biggest thing I have found to be effective is explaining every little bit of the job to the customer. Tell them how you are going to do it and why it takes the time it takes. Tell them your adherence to industry standard and safety. Go over every detail. I cant tell you how many jobs i've gotten that I have not been the lowest bidder (not even close) but they liked my attention to detail and how I explained where their dollars were going and why.
 
I usually just bid the tree based on what I think it's worth. I usually just go off a straight price, not trying to figure out hours and equipment costs. I have a pretty good idea of what money will get the job done with out trying to do a bunch of math in my head. That being said I have a range of prices depending on our work load, area of town, existing customer, etc... If I have to go lower for what ever reason sometimes I assign the job to a specific crew based on what type of work is being done. If I have to buy work I always try to do it on smaller pruning, shrubs, commercial, etc.. Nothing worse than banging all day on a large technical removal or prune and having nothing to show for it.:endesacuerdo:
 
I find it really hard to talk with the client, connect with the client, talk about there trees, and also be trying to figure out what equipment is needed, how many guys, where is stuff going in regards to access. I try and walk around the job for a good half hour and discuss all the options and talk with the customer about trees. This is my time with them, it's about them. I cannot concentrate with them asking me a ton of question. I then separate myself from them and tell them I will write them something up. I then try and walk the job "again" with out them. This is when I am really looking at what equipment is needed, how many guys, and most importantly how the job will be executed.
However, I bill out an hourly price no matter what equipment comes to the job. This way if the bucket sits for a week we are still making enough money to cover the costs of that piece of equipment. I have found it too hard to try and set each piece of equipment apart and have it's own price. So far it has worked pretty good for me.
 
I agree Royce. I think a flat per man hour rate with equipment costs built in is the best way to go. Cause like u said even if the equipment is not on the job it still has to get paid for. This system also seems to be the most simple way to cost jobs quickly. If u cost all the equitment seperatly it quickly becomes confusing. Like if u have an all day job where u use the bucket for three hours then climb in the back for the rest of the day, do u bill the bucket for 3 hrs or the full 8 cause it was there? If u bill it for the full 8, then u are essentially billing ur climb work at a bucket rate.
 
Sherwood7 you got it, that sums up me feelings on it. When I first started my business I was told by an old timer to separate everything out and then charge accordingly. I just found it to be way too confusing like you mentioned. Like if you bring the log truck but only use it to load a few logs at the end of the day. Are you charging it out for the whole day? No way, that just wouldn't make sense.
 
I totally agree with not separating all pieces of equipment out. Unless your talking about something incredibly expensive like brand new bucket, crane, knuckle, etc. Those pieces of equipment would get their own hourly rate. Just knowing what you need to get per guy/ per hour is the key. Your hourly rate has payroll, taxes, payroll taxes, equipment, maintenance, fuel, WC, insurance, etc basically all your operating overhead all built in to it.
 
One of the best tools I've learned in closing the jobs in my area is not lowering my price but adding something of value to the client. Some type of tree work that can be can done from the ground or from a quick climb that can be done while the rest of the crew is cleaning up or setting up. Doesn't add any time to the day but usually gets me the job that I may otherwise have lost over $100.

Chris
 
lacky said:
One of the best tools I've learned in closing the jobs in my area is not lowering my price but adding something of value to the client. Some type of tree work that can be can done from the ground or from a quick climb that can be done while the rest of the crew is cleaning up or setting up. Doesn't add any time to the day but usually gets me the job that I may otherwise have lost over $100.

Chris
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Great Idea!! I am going to steal that one from you!!
 
Its very good to know your numbers--what your crew costs, what you'd like to get on a daily basis. It is also good to know what stage of the annual cycle you are presently at. Sounds like the winter thaw has got everybody out thinking about their work. The fish are biting. Time to aim a little higher with your numbers. No good being booked out 6 weeks...they start falling off. It can turn around, however, and I'm learning these little epicycles more and more with each passing year. We had a very warm and dry winter here, thus an earlier spring. Conditions now are almost like early summer. Markets tightening up a bit...seeing my competitor's bids I know they are so tight they are starting to hang themselves. They seem so eager to slit their own throats on large jobs. Easy for a hungry salesman to forget what the work entails and offer the customer the lowest bid. But you know too much already to do this to yourself because you own the company and it is you who will be doing the work.
 
ROYCE said:
I find it really hard to talk with the client, connect with the client, talk about there trees, and also be trying to figure out what equipment is needed, how many guys, where is stuff going in regards to access. I try and walk around the job for a good half hour and discuss all the options and talk with the customer about trees. This is my time with them, it's about them. I cannot concentrate with them asking me a ton of question. I then separate myself from them and tell them I will write them something up. I then try and walk the job "again" with out them. This is when I am really looking at what equipment is needed, how many guys, and most importantly how the job will be executed.
However, I bill out an hourly price no matter what equipment comes to the job. This way if the bucket sits for a week we are still making enough money to cover the costs of that piece of equipment. I have found it too hard to try and set each piece of equipment apart and have it's own price. So far it has worked pretty good for me.
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I find this hard, too. People ask after I suss out the scope of work how much it will cost. I say that now that I have the Scope Of Work understood, and their questions and considerations addressed, I can figure out what it will take to do the job to the agreed upon specs.
 
I have been enjoying this thread. Pricing is a tricky beast. I typically walk the property with the client, talk through the job, then go back to the trees alone to calculate my approach. I usually take my time until I come up with a number that makes it worth showing up for. At the end of the day, each job needs to contribute to hitting and exceeding your operating costs. Find that day target and price in relation to how is this job going to contribute to hitting this target. I have been running my business full time for only three years. When i started out i tried to keep prices as low as possible to keep work coming in. Being a friendly dude, I really wanted to work with the homeowner and cut them as good a break as possible. I realize now what a folly that is. As skilled professionals we need to charge fair rates. Fair rates are ones that cover overhead, pay guys well, include business profit and at the end of the day the boss makes some money as well. Thinking back over the "deals" and "favors" i gave clients over the early years, i shudder. In December when there is no work and the truck is broken down, or when taxes are due, or you get blown up in your workmans comp audit, i cant go back to the fifty Mary homeowners and say, you know i gave you a real good deal on that removal or prune job, think you could do me a favor and throw down another couple hundred. At the end of the year, when the work screeches to a halt, i eat those costs, thus subsidizing those "deals" and favors.




CreTree said:
70% of my customers are people who own a second home here on the Cape. I am trying to pay for the One I built here. Rarely do I bend and it bugs me to see my Comp doing that or other jobs I never even knew about. So be it. I do not, that I know of, have a single unhappy customer. Even the one job I walked off of because her cesspool was flowing onto my gear. A yr later she was mowing under me while doing a removal, again I left. They call me back every yr for a G or better. Glad you called back Royce.
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Couple weeks ago, im looking at this nasty Silver maple(neglected, huge dead limb going over garage!)..removal...it was out of my comfort zone!...he gave me a price, I had to beat...I said no way I can beat that price!...went home and the wheels started turning...so, I called him back that night and said I can beat it...used the omni block on it and demolished the tree..and he tipped us!..business is like anything else in life (trail and error!)...you just can't give up
 
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