Never underbid a job again...

I recently started dong my own side work again after about a year off and let me tell you, I forgot how to bid a job. All it took was one job to get me right back on track, but knowing what to charge is all about experience with many jobs. I didn't lose money, just had a horrible rate. But the homeowners let me more than double the price on a removal because even they saw that the job was worth way more than what I charged. They are nice people. I was afraid I wouldn't get the job if i bid any higher and I was hungry for work, so that clouded my judgement as well. I think its best to know a man hour rate, figure the hours that the job is going to take and then use multipliers for hazard trees, complicated rigging, dog poop in the yard, etc. ALWAYS Charge for dog poop in the yard!!!. I tell people up front if they have a dog that if the yard is loaded with dog poop its going to make the price go up. They usually understand.
 
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Calling it one of the dumbest things you've ever heard is probably a little harsh. The method does increase the price as tree diameter increases and it does increase the price when working over obstacles. So that's not necessarily a bad start. Add a few (or a lot) more modifiers, and voilà, you have a good formula.

Losing money will put a hasty end to underbidding. It's overbidding and losing an otherwise profitable job that can only be rectified by accounting acumen and field experience.

Make a video Donald and show us how it works.

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I'm glad to see you found this way a little useful. Everyone else seems to be dumbfounded by this way.
 
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ALWAYS Charge for dog poop in the yard!!!. I tell people up front if they have a dog that if the yard is loaded with dog poop its going to make the price go up. They usually understand.

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That's a good idea cause you should never step in crap again.
 
Donald it helps to have a cost estimate to work a crew for one day...a day rate with all equipment..or a day rate with one person..etc. that seems to be a good start.

How long to do the work

how long to get to the site and back.

get rid of the chips and wood.

fuel and oil

workers comp and liability insurance

wear and tear on equipment

daily maintenence.

One coffee for the boss (that's me)

hope this helps, I'm sure you get the picture..
 
I know a guy that figures the cost of 2 new saw chains into every bid. When his chains get dull he just puts a new one on. When he gets a stack of dull chains he takes em to get sharpened. This guy is just a retired coal miner who got into the tree business to stay busy. If he can't get his bucket to it, he won't do the job.
 
Calling it the dumbest thing ever was harsh, but you can just step off a tree and come up with a price. Location has much more to do with cost than diameter does. What if you have a small pine but it's in a perennial bed where you can not drop anything do you charge 100 dollars for every branch and chunk of wood you have to rope down. Put that same tree in the far back corner of a fenced in back yard were you have to carry everything out, and it's going to be a lot more expensive than if it's in a open front yard where you can just drop it and winch the whole tree thought the chipper.
 
Donald- if it works for you and you make money, go for it. IMO every job is unique and requires consideration of all the factors people have posted about. If your friend says he has never lost money on a job, take it with a grain of salt. Nobody bats 1000%.
 
What I think is being said, is that there is a BASE cost and variables. Thinking in accounting terms we're talking about fixed costs and variable costs. Donald's buddy has come up with a simple way to figure out his rate understanding these two factors. Straightforward and simple method for him.

When i first started doing estimates, I went through a lot of detail but found that it became repetitious.

Do you have a minimum charge regardless of the tree? It's not always about that tree but our costs.

Got to agree with Zale, if it works for you Donald keep it up. Only thing is, understand the real costs behind the numbers so you can adjust the multipliers as your fixed costs change.
 
Oh Christ, I had my formula inverted and paced it out with clown shoes . . . I'm going to lose a sh*tload of money this week on bad bids.

I'm hiring an ex-pirate with two wooden legs to get me out of this jam. (I already have two Geisha girls, but they don't like to leave the house)
 
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Oh Christ, I had my formula inverted and paced it out with clown shoes . . . I'm going to lose a sh*tload of money this week on bad bids.

I'm hiring an ex-pirate with two wooden legs to get me out of this jam. (I already have two Geisha girls, but they don't like to leave the house)

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super funny, are you going on tour soon? I'd buy tickets.

No seriously, here's the best formula for never underbidding a job: bid 1000 jobs and perform just as many. You'll probably underbid at least 30 of them. The amount that you are under will get less and less every time. I'll never forget the job i bid $330 and it took 10 hours. Two man crew, bucket truck, chipper. Yup, that's $33/hour.

If you rely on a formula to assess a tree, you'll probably hose yourself just as much.

v
 
Dude...PUNCTUATE

@ Donald

I've found that there is no real 'one size fits all' approach to bidding jobs.

The best way I've found for straightforward jobs is T&M. Anything else is a little more difficult. A person just has to gain experience and know the costs involved inside and out. All variables have to be considered. It is very important to look at all access to the work, and to evaluate the site THOUROUGHLY. Nothing worse than showing up to a job which has an extra hazard which was not noticed during the sale.

I've been told that one should always measure stumps to price them out...think I do? Hell no. Do I always price out jobs based on an hourly rate? No. There are times when the work warrants a higher than average rate. A client will give a lot of clues as to the kind of budget that they have for the work.

As for Mr. Roberston...well...keep on keepin on dude.
 
It interesting I saw this tonight. I am bidding a large clearing job with a business associate. He has a program where he has all equipment listed and price associated to them type of worker with price, profit margin, other variables. All are custpomizeable. We chose which equip/people/etc and how long for each one and we got a price. we tweeked it from there. Is anyone using estimating software?


Not trying to jump on the thread but thought it related. I for one will try the above method on a couple jobs I already have when I get there and compare. What do you do for pruning?
 
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If this works I'm going to include boot size on sales rep employment applications.
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hahahahah


hey donald i like your idea cause i have really small feet.... hahaahah lol im gonna be makin millions yea.....lol
 
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I'm sorry I don't mean to be mean but that is one of the dumbest things I have ever heard. I've been pricing tree removals for 17 years and one things for sure there is no fromula that fit all trees. You just know from experience how long it will take to take down and clean up and price accordingly.

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Exactly what I would of said.
 
You guys can keep saying good or bad stuff about how I make an estimate for a tree but I'm not crackin on you how you do things but I know the the way I explained in the forum how I price trees is not a bad way for me nor guy guy I know who thought of this have ever lost money doing it this way. So if you don't like my way, just keep on doing the way you do it.
 
Donald,
If this formula works for you then use it.
Do a few more jobs and then describe to us how it worked out.
We used the WAG method years ago and it seemed to work. (Wild asss guess)
The hardest part for most companies is figuring overhead.
Only you can put a number on.
What does it cost you to go out and work for a day?
 
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