Contractor Cuts
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Contractor Cuts
Beyond the Basics: 10 Critical Estimate Items Contractors Forget
Clark Turner reveals the top 10 critical items contractors forget to include in their estimates, resulting in lost profits and awkward change order conversations. He shares practical strategies for building comprehensive estimates that protect your margins and enhance client relationships.
• Due diligence line item covers pre-construction work like Gantt charts, selection workbooks, and MEP walks
• Design fees for renderings, layouts, or interior designer consultation should always be included
• Architectural and engineering costs need separate line items, especially for additions
• Port-a-potties, temporary utilities, and job boxes are essential job site preparation items
• Include separate line items for each required inspection to improve scheduling
• Site protection costs for floor coverings, countertop protection, and dust barriers
• Landscaping restoration is commonly forgotten but important for client satisfaction
• Final cleaning ensures the project ends on a high note and prevents disputes
• Create job templates in your estimating software to include these items by default
• Document when clients decline services like cleaning to avoid disputes later
If you want the full list of these 10 items or to learn more about our coaching services, visit prostruct360.com and schedule a call directly with me through the contact page.
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Want to learn more about our software or coaching?
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Welcome to Contractor Cuts, where we cover the good, the bad and the ugly of growing a successful contracting company. Welcome to Contractor Cuts. My name is Clark Turner. Thank you for joining us again this week. So today we're doing another Coaching Cuts, which is our shorter version, where I talk directly with you about things that I cover in my coaching sessions with our clients. So I wanted to cover today a really important topic. Last week we covered estimates, how to build estimates, things that you can do to compete, as well as how do we defend ourselves against the low ball offers that sort of thing. If you haven't listened to last week's start there, go back and listen to that one. It's a really good one. This week we are talking about the 10 things that contractors forget to put on their quote before the job starts that they end up losing money on that they either have to pay out of their pocket or they're those early change orders where we're going to have change orders, potentially on a job. I don't want to use those up early and make a client upset on stuff that I should have caught originally. So today we're going to list the top 10 things that I want to see on every single estimate Now, before I get into it, if you're in our software, there are job templates.
Speaker 1:In the ProStrux 360 software you can build a job template and what that is. You can add a bunch of line items and save it as a template of a normal estimate. So when you're starting a job you can say, hey, I want to use my standard template and you can have all of these items already listed on there. You can do a kitchen renovation template, you can do a basement, you can do an addition, you can do a new construction template. But you build out these templates with all of your line items already on it, where all you have to do is select it, edit those line items, delete some, add some, change quantities and it takes a 40-minute estimate down to about five minutes. What's great about that is these 10 things I'm about to talk about today. You can go ahead and prep and have on those estimates. That way you're not forgetting them. You're not having to remember them every single time and add this stuff on Now. Again, these 10 are not going to be on every estimate, but I like to have it in my template and delete them off if I don't need them, as opposed to having to try and remember them every time.
Speaker 1:I'm writing an estimate, all right, so let's run down the list of the top 10 things that I want to see on your estimate. Number one and we've talked about this in other podcasts, I'm not going to spend too much time on it is your due diligence, your pre-construction due diligence line item. I want you to be charging the client for the time you're spending before you start swinging a hammer. The due diligence if you haven't listened to the podcast a month or two ago is where we take the time. We slow down and we say hey, listen, we've got a very close estimate. During this due diligence period, we're going to charge you $1,000, $1,500, $3,000, $6,500, depending on the size of the job, amount of work we need to do During the due diligence.
Speaker 1:I'm building out your Gantt chart. I'm building out your selections workbook so we can pick out every single material before we get started. I'm doing my MEP walks and walking the crews on the job site or pulling the blueprints and showing it to my vendors and my crews, and I'm making sure that every dollar is accounted for and every selection is picked out to where, once we start construction, there's not a lot of discussion calls to the client hey, I need this picked out. Hey, don't forget this. I need that paint color by next Tuesday. And then it doesn't get picked out and so we can't order the paint. Now we're behind schedule. Right, all of the stuff that you need to do to prep for the job we do during due diligence and we charge them for it.
Speaker 1:And I explained to our client saying hey, listen, I'm going to take some money from all of our line items and pull it out and this money is the due diligence money and in that money I'm going to spend all of our time converting the estimate into a quote. So by the time we get out of due diligence and we're starting construction, I've got a quote built that you are down to the penny spent. We've got your final material selected, the flooring that you want, the light fixtures you want. All of that is on the finalized quote. To where now the numbers are locked in. It also allows me to walk on our estimates. I might throw $10,000 for the HVAC.
Speaker 1:Now, during due diligence, I sit down with my HVAC technician and say, okay, this is what we're doing. This is the look. It's very similar to that previous job we did. I budgeted about 10 grand. They look at it and say, yeah, according to this, let me get you a quote and it ends up being at $10,800 for what we need to do. I then take that and edit the estimate to where those final numbers are, converting from an estimate to a quote.
Speaker 1:So that due diligence period don't do for free, don't do all hours and hours and hours of work for free for clients, for them to go with another contractor. We want to charge for the due diligence and make sure there's a separate line item on there. It's hard to pitch in the beginning, when you're first starting to do it. Give me a call, let's hop on a call and I'll help you do it and we'll practice running through it. But having that due diligence line is so important. So that's number one.
Speaker 1:Second thing that I want to see on that quote I want a design line, I want an interior designer, some sort of layout. Obviously, if you're doing a new construction, there's going to be already architect design, all that stuff in it. A lot of additions will have that. But when you're doing a kitchen or a basement or a bathroom, a lot of times there's not a designer involved, it's the homeowner wants to do a new kitchen. Here's some pictures. I've thought I've seen that I like Can you guys do something like this? I'm not a designer, I'm a contractor. I enjoy the design. I enjoy that side of it. I can do it for you, but I'm going to charge you for it. You know we would charge $500 to do a sketch up and rendering of the kitchen and we'll just our project manager will do it for you or one of our people in our office will do it. But we are going to charge to think through the design phase.
Speaker 1:A couple of reasons we do this. Number one you're spending time on it. We want to charge if they want us to design it. They come with an exact design. We're quoting it. We're thinking through it and giving them a quote and then executing the work. Great, we don't need a design line on there.
Speaker 1:But if you don't know what you want, if we have an interior design line on there, we've got interior designers that we work with and we say, listen, I'm going to pay for two hour session with this interior designer. That's on our quote. It's a part of our quote. I want them to help you pick stuff out, if you want, if you have me pick out your paint colors, we're going to be painting the house purple. You don't want that. You don't want me doing your selections. I'm a general contractor, I'm not a designer. So it gives a spot where I can ask the client, hey, who's doing the design work? By asking that when I'm going and reviewing the estimate, they're automatically the assumption is I'm not doing design, I'm charging you for it. We're going to hire a designer, they're going to handle it. If you want me to do some renderings, if you know AutoCAD or SketchUp or something, you want to charge someone to do it, great, but have a charge to do it. Don't do that stuff for free, all right.
Speaker 1:Next line on there I kind of mentioned in the last one architects, renderings, any sort of engineer, all of that stuff we need to put on there. Obviously, if you are doing an addition or a new construction, there's going to have to be all of those things, an arborist potentially. I like to have it on there and have that conversation with the client. Even if we're doing a kitchen, even if we're just doing a bathroom, I'm going to say, hey, do we? Are we getting renderings? Are we getting drawings? Again, that's similar to the design. But I want to make sure that, if they are expecting that, that we've got a budgeted line item for it so we can have that conversation. They can see the price on it, they can see our budget amount for the architect and for the engineer and that will fluctuate depending if it's a new kitchen versus a new construction versus an addition. Right, all those are different prices. If you need those prices, call your architect, say hey, I'm trying to do roundabout budgeting numbers for my estimates. Help me with this. How do you charge for this? How do you charge for that? Go through that and they will love to give you those prices. You lock them into your software, you put them into your line items, you select architect, new construction. Boom, it's already pre-written on your estimate. You're good to go, so make sure we're charging for that Now.
Speaker 1:Again, this is one of those things that is going to be a change order. If you forget it, on stuff like an addition, if I forgot to put an architect on there, we're going through the estimate, we get some signatures, we're ready to start and I'm like, okay, well, we need an architect. Oh crap, I didn't put that on my estimate. Hey, we need to add this on. And so, before we even got started, I'm hitting them with change orders to be things that actually happened during the project. That actually is a valid change order. That wasn't because you were incompetent as a general contractor and didn't build the right estimate, but stuff that comes up changes, requirements by the city, that sort of thing I want to keep for my change order. I'm sorry, conversations, not hey, I forgot to put an architect on our quote. I'm sorry, conversations, not hey, I forgot to put an architect on our quote.
Speaker 1:Next thing, after we get all of that, our designs let's start thinking about how we're going to prep this job site. So, number one that I'm going to put on there port-a-potty, port-a-john, whatever you call it in your area I'm going to have one of those on there. Two of those multiple months we price it out by the month, and so, whether it know whether it's a month, month and a half, three months, it is a per month charge. That's preset in our software. So I put that in there. I say, okay, this project's a four month. I click on four, boom, my pricing's on there and it's and it's set.
Speaker 1:Osha, you got to have one of those on site, even if you don't. I don't want my crew walking through a house, going to the bathroom in the client's guest bathroom or their hallway bathroom, so I want to have one of those on there. If the client says, hey, take that off, I don't want to pay for that, say great, which bathroom can all my guys use in the morning after their coffee? Right, and so we. It helps us have that conversation of expectations as well, as I'm going to have to pay for that, and if it's not on the quote, it's a hard conversation about another change order as well as well. I, you know I assume that you guys were taking care of that I'm not going to pay for that, you know, after you've already signed the quote. So make sure that that's on there.
Speaker 1:Next, temporary utilities right, when I do electrical sometimes you know talk with your electrician about. But we need a temple. If we're adding new electrical somewhere, there's going to have to be a temporary electrical pole that we've got to do separately and a permit for it. Or let's say we're working on a property and there's not going to be power on. I need to budget for a generator. I need to budget for a water truck to come if there's no water on it, there's all of the utilities that you might need temporarily. Have that as a line item on your standard template. So when you're going through building your estimate you can see it and say do I need that? No, I don't Delete it off. You're not going to use that on every single job, but having it on there allows you to either charge for it or delete it off. But those type of things are assumed that that's part of the quote, right? So it's a lot harder to get a change order for that than like an architect, because on something like that you're saying, hey, I need to have a generator and they say, well, you knew the power was off, you quoted it that way. I assume that that was part of your quote. And now there's this push and pull with the client thinking you're taking them for granted, trying to take money from them.
Speaker 1:Another line item we do it's a cheap one job box, right, I'm putting a four by four posts outside. I'm getting a box, whether it's a custom built one that you do, or one from Home Depot I'm putting a couple hundred dollars on there for that. I want to post it so I can put all my permits on there, all my paperwork in there. But we need a charge for that. So it's a line item so we can make sure we budget for purchasing what we need to purchase and assign someone to install it and that sort of thing. So again, that's somewhere that we've lost money on. We've forgotten to put that on there and we just do it because it's difficult to change order.
Speaker 1:Something like a job box to be able to have the permit box out there. So make sure that that's on there. It's a small one, but again, two, three, $400 on every single quote really starts to add up. Next, now this one I sometimes charge for, sometimes don't, but I want it on there, whether it's a $0 line item or I'm charging for them. But I want to have separate line items on my estimate for my inspections, right? So if you are doing permitting on the property and you have inspections, I want to have inspection number one, inspection number two, inspection number three as line items on there. You can charge for those. Say, hey, I'm going to spend half a day waiting for the inspector to show up, meeting him, walking him around, so I charge per inspection. I'm breaking it out as opposed to just lumping it into some of this stuff or other times it's part of your quote and so you're just doing a $0 line item.
Speaker 1:But by doing that there's a couple of things I can do in my software. Number one I can schedule it on my Gantt chart and see when my inspections are and say, hey, I'm gonna tie the inspection line to the sheetrock that's coming next. My drywall line can't start until the inspection's done. So if I move that inspection down, my drywall and everything else shifts on my timeline. So I can see my new accurate timeline in the job. So I can see where all my inspections are visibly on my Gantt chart, on my calendar, by having those line items in there. And then I'm going to assign the line items to myself or my project manager, so their name is beside it and they say, once we pass an inspection, boom, mark complete. Even if it's a $0 line item, great, we can still mark it complete and show, hey, this is the date that we passed the pass, the inspection, and it's all noted on there. Clients can see it. It's just additional information. That's super helpful and sometimes you can charge for that stuff as well.
Speaker 1:Next thing site protection. This is the big one that we've lost money on. That is super easy to charge for because you can give the client the option right. So, site protection I mean I want to put cover all the flooring right. If we were walking through hardwoods, I need to put some sort of protective covering on those floors. Countertops I want to cover the countertops. Plastic walls between rooms, on the rooms. We're not working in Stuff like that, where I'm thinking through keeping the property clean and protecting the areas that we're not working in, those that stuff adds up and that stuff, who's setting it up, who's tearing it down, who's cleaning up? At the end, all of that stuff needs to be on the quote and you can easily charge for it, because if the client says, hey, what's all this for? Well, we don't have to do that. There's just going to be dust all over your entire house or there's going to be mud across the floors. If you're fine with it, or we can charge for this. It's a couple hundred dollar line item, it's not a big deal, but having it on there allows me to sign someone to do it, allows me to charge for it and not have that leaky bucket of dollars just pouring out of my pocket that I'm not accounting for All right.
Speaker 1:Number nine on my list is going to be landscaping. Again, this is one that will for sure be a change order, but I don't know why, but we always forget about it. Now, on new additions, on new construction, we you're not going to forget it, because that's that's kind of one of the standard things we talk through. But a lot of times we're doing, uh, some exterior work, we're doing new siding, we're adding, you know, changing the roof out, or you know, maybe we're pushing a kitchen two feet, uh, out into the yard or a room extending a little bit, a minor addition that we're doing on the property. What are we doing with the landscaping outside? Is it going to be mud when we're done? Is it going to be torn up bushes? Because we did all this siding?
Speaker 1:If I start talking through that now, the torn up bushes were budgeted for and expected where we need to work on that, as opposed to, if we don't have that on there, don't talk about it with the client. We mess up some bushes and some grass and they're like, hey, you guys suck at what you're doing. You need to come back out here and fix this for free If it's on my quote and say, hey, listen, when we're doing all this siding, you know all these bushes need to get trimmed back, and afterwards you're probably going to want some, you know some sort of mulch or something around the base of this. You can have that conversation, charge them for it. They're thankful that you're thinking through that stuff and now you're not having to cover the cost and they're happy with it. Right, you're saving your reputation, saving your dollars and covering your basis on your quotes to where you're not thinking about more fires that are happening later on. So make sure landscaping is on those jobs, even on interior jobs.
Speaker 1:Right, I got guys walking through the back, around the side of the yard to the back. Hey, when I have 14 guys walking through here for three months straight finishing this basement and doing whatever's happening on the interior of the house, we're going to have some tearing up of your, of your grass over here. Do you want to do something about that? Do we want to plan for seeding afterwards? No, that's fine, I've got a landscaper He'll handle it. I've had that conversation up front. Now they can't be mad at me at the end when it's when their grass is dead where we've been walking. So have that line. I'm on there, even if it's just a discussion point with the client, if you're going to be walking through the yard, that that sort of thing. And the final line, number 10, that we that I always like to have on there. You should always have this on there cleaning.
Speaker 1:I want a super clean line and what this is is we have a cleaner come through and we list out what we're doing. Now a great example we're doing about to start a basement. It's a full basement. It's an unfinished basement. We're just finishing it. We're entering through the outside. We're not walking through the house. So the cleaning that we're doing is we're going to wipe everything down. We're going to mop the floors after we install them. We're going to wipe everything down. We're going to mop the floors after we install them. We're going to make sure everything's cleaned up. Um, you know my flooring guys do their cuts and there's a couple of scrap pieces. We're picking all that up and this also includes cleaning outside around the door or the walkways that we got in and out from. I want, um, maybe a bale of pine straw to cover where the guys wash their brushes out. I want to leave the house looking like a brand new home I wanna end well, and it charged 450 bucks to clean that space so I can send a cleaner out there who has that eye on it.
Speaker 1:If someone says, hey, no, you know what, I'm gonna clean it myself. Take that line off there. Okay, I just want you to know. I'm gonna put in writing. I'm gonna put zero this cleaning line item out and say client chose to clean themselves. This means the site will be left dirty and scraps, blah, blah, blah, blah, blah, blah, blah. I'm going to put that on the quote. So when they sign it, I've got an agreement that they did that. And so towards the end of the job, when they say, hey, this doesn't look good, and you know I want to give you your final payment, say let me have my cleaner out here. You know you took it off the quote, can I? Can I put it back on there? But now there's an expectation of the way the job site's gonna be left at the end and I've got dollars budgeted to make it look good and end well on the job. So again, I ran through 10 of those very quickly.
Speaker 1:If you're driving around your truck listening to this, go back and listen, take some notes If you want the full list of this, let me know. Hit me up. Go to proshruck360.com and I'll send you a copy of these 10 things and how to do it. Love to kind of show you around the software and how to set it up this way. If you're one of our coaching clients, on our next meeting let's talk about this and let's start building out your job templates. So all of these things are included and we make sure we capture them.
Speaker 1:If you want to talk about coaching, if you want to talk about software, if you just have some questions about how the heck you need to be doing something in your company, I'd love to have a conversation with you. Go to ProStruck360.com and go to the Contact Us At the bottom of the Contact Us. My calendar is on there where you can schedule a call with me. So go to our website, schedule a call directly with me. I love to have a phone call with you. Uh, if, if you're interested in any of this stuff or just have a have a question about how to run your company, all right, thanks so much for listening this week and we'll talk to you next week.
