My gut and my math sometimes disagree,, The only reason I ask this is because I want to trust my gut

jefftheswede

jefftheswede

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San Diego, North county
My gut and my math sometimes disagree,,
The only reason I ask this is because I want to trust my gut, but when I do the math, it seems really low,,
There must be a gut bid to reasonable bid, is your Gut more powerful than your Math
Dang ,I walked this property and it is a massive job,
without giving too much info, my gut is way more than my bid.
Jeff
 
@jefftheswede; I'm not a pro arb like most of you folks, so take what I say with a huge grain of salt. I think your gut may be taking into account all of the unexpected things that always seem to impede progress on any task. The expression a lot of folks use is that "everything takes twice as long as you think it will, and costs twice as much".

It will be interesting to hear from you later how this all plays out. If you actually offer the customer the bid that is based on your math, especially. I hope it all works out for you, and that you make a healthy profit. Glad you might have so much work on the near horizon.

Tim
 
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Mangoes is the one that can tell you how to price a job.

The job price must make you money if you want to remain in business.

And always remember that the tree is always bigger when you go to do it than when you priced it. A nice corollary is the tree is always more complicated to remove than you priced it for.

Oh and don't forget all the unpaid hours that you need to be paid for.
 
Is this particular job pruning or removals? Pricing jobs can be very difficult. Sometimes it's easy to get carried away with adding more on here and then more on their to cover yourself if things go behind schedule. But, then your price will end up extremely high and you price yourself out of a job.
Can your gut and your mind meet somewhere in the middle?
 
If it's a big job, I try and break it down into smaller pieces. There are many ways to price jobs, and you have to determine how your currently doing it. What I mean is, some companies price per employee(man hours) Some price by what equipment is going to be used, some have a price for their entire team and equipment and that is a day rate. Then, you just determine is it a 1/4 of a day, 3/4, 4 days. Whatever it is that is your price for the project.

Last winter I looked at a large job of removing 90 or so large white pine trees. Most could be felled. Two days with a crane. I came up with a price that seamed WAY too low. Then, I re-evaluated it and came to the conclusion that the reason my gut was telling me the price was so low because I was comparing it to doing this work for 30 or so different customers. Two large pine trees in Mrs. Jones front yard would yield 3500. So there is definitely a price difference. 30 small(er) jobs will yield a higher profit margin than one big job. In my market anyways. Plus, the large jobs really put a lot of wear and tare on your equipment.

I hope some of this helps.
 
I agree with both and Royce. I just did a small job that I had initially figured 2 hours each for 2 trees. Didn't realize how much of a hairball the one would be and wound up spending twice as much time on it.
 
royce makes a good point with smaller jobs yeilding more profit then a one big job. also the wear and tear on equipment. each job is different each customer is different. for me labor is the biggest expense. for jobs price out all your costs and figure what you want to make for the day. bottom line steady money is big money, don't loose but on some you make more some you don't make as much but maybe those lead to other leads.
 
jefftheswede said:
My gut and my math sometimes disagree,,
The only reason I ask this is because I want to trust my gut, but when I do the math, it seems really low,,
There must be a gut bid to reasonable bid, is your Gut more powerful than your Math
Dang ,I walked this property and it is a massive job,
without giving too much info, my gut is way more than my bid.
Jeff
Click to expand...

If you are pretty seasoned, let your gut guide you. If you're green, remember that it is better to not get a job than it is to lose money on it.
When my two man crew was young and hungry, we found out that a quick $300 prune on a really big red oak really needed to become a removal, we didn't want to price ourselves out of a job so we bid it at 1800 hauled... 8 days later, we did the math and ended up making just over $4 an hour each, after overhead.
I haven't gotten many titan trees since then, but the ones that I have removed have been ones that I made enough money that I was happy to climb with a big saw.
 
Your gut is based on your experience so should your math. Your math needs to be complete taking into account all aspects of your costs, fixed and variable, how many billable and non-billable hours go into a given job and your labor and equipment costs. Then look at where you can realize some efficiencies in order to maximize your production and profit. What is most important is to understand your client and their values. i.e., what is their primary buying factor. Is it the condition you leave the place in? Peace of mind that the people working on their property are trustworthy and professional? Or, is it just the lowest price, damn everything else.

What their values dictate is not the price you can charge but the level of service you need to deliver and that is what will determine the cost of the job.
 
SomethingWitty said:
If you are pretty seasoned, let your gut guide you. If you're green, remember that it is better to not get a job than it is to lose money on it.
When my two man crew was young and hungry, we found out that a quick $300 prune on a really big red oak really needed to become a removal, we didn't want to price ourselves out of a job so we bid it at 1800 hauled... 8 days later, we did the math and ended up making just over $4 an hour each, after overhead.
I haven't gotten many titan trees since then, but the ones that I have removed have been ones that I made enough money that I was happy to climb with a big saw.
Click to expand...

As you mature as an arb and your equipment inventory matures you CAN make these jobs come out...but you cannot be WAY out on the bid. You cannot create experience but you can spend time on here (Buzz)...and you CAN create equipment...but you gotta have the experience to be able to afford to buy it and know WHAT to buy in what condition and what gambles are involved in financing given your present state.
 
treevet said:
As you mature as an arb and your equipment inventory matures you CAN make these jobs come out...but you cannot be WAY out on the bid. You cannot create experience but you can spend time on here (Buzz)...and you CAN create equipment...but you gotta have the experience to be able to afford to buy it and know WHAT to buy in what condition and what gambles are involved in financing given your present state.
Click to expand...
Sage advice. Take heed, the man knows his stuff.
 
treevet said:
As you mature as an arb and your equipment inventory matures you CAN make these jobs come out...but you cannot be WAY out on the bid. You cannot create experience but you can spend time on here (Buzz)...and you CAN create equipment...but you gotta have the experience to be able to afford to buy it and know WHAT to buy in what condition and what gambles are involved in financing given your present state.
Click to expand...

Then the problem becomes trying to figure out what you want to do the job with? I find that is my biggest issue. I look at a job and then it's the well....what should we use..Crane? Bucket? Dingo? Tractor? Ect.
 
ROYCE said:
Then the problem becomes trying to figure out what you want to do the job with? I find that is my biggest issue. I look at a job and then it's the well....what should we use..Crane? Bucket? Dingo? Tractor? Ect.
Click to expand...

Sell the crane. You'll know which jobs you want to spend those extra dollars on as soon as it's not just another piece of equipment at the yard. :lol:
 
The crane for a small operation is suspect but if you can buy on a good deal in the 50 to 70 k price range for a 100' plus 25 k ish machine...it will be the high dollah grabbing piece in the lot. In getting jobs, completing them in a safe and timely way and separate you from the bottom and middle feeders.

It doesn't need to go out every day when you bought at a reasonable price.
 
@treevet; Really, it's possible to buy a small crane for between $50,000 and $75,000? That is just amazing to me. It seems like new pickup trucks aren't far from that. Do you need to be your own gearhead/crane maintenance expert to make it all work, or are you able to find those types of services in the marketplace at a price that doesn't just crush you?

Thanks in advance for any answers you choose to give.

Tim
 
What did you see in that red Oak that made you call that a removal? Very often these decisions get made without an adequate look at pruning options.
 
treehumper said:
Your gut is based on your experience so should your math. Your math needs to be complete taking into account all aspects of your costs, fixed and variable, how many billable and non-billable hours go into a given job and your labor and equipment costs. Then look at where you can realize some efficiencies in order to maximize your production and profit. What is most important is to understand your client and their values. i.e., what is their primary buying factor. Is it the condition you leave the place in? Peace of mind that the people working on their property are trustworthy and professional? Or, is it just the lowest price, damn everything else.

What their values dictate is not the price you can charge but the level of service you need to deliver and that is what will determine the cost of the job.
Click to expand...

Bid is in, I guess I asked because I have never been this far off the bid. Yes, I am seasoned, started climbing when Jimmy Carter was the President.
Anyway, like I said , my gut and my math was a 50k difference.
I revisited the site 2 more times and satisfied with the numbers. There are a couple of more competitors bids to come,
It would really be a fun job for the guy's, massive dead euc's on 4 acres,,all the toys, etc,
Jeff
 
jefftheswede said:
Bid is in, I guess I asked because I have never been this far off the bid. Yes, I am seasoned, started climbing when Jimmy Carter was the President.
Anyway, like I said , my gut and my math was a 50k difference.
I revisited the site 2 more times and satisfied with the numbers. There are a couple of more competitors bids to come,
It would really be a fun job for the guy's, massive dead euc's on 4 acres,,all the toys, etc,
Jeff
Click to expand...
Keep us posted.
 
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