Pricing Jobs as a General Contractor: How to Give an Accurate Quote
By Scotti Ian Ogden
Owner of Ogden Contracting LTD
As a General Contractor, pricing a job is complex. It’s not as easy as some would think. Here’s my tips for providing customers with an accurate quote.
No two jobs are the same. There are many variables included in providing an accurate quote to my customers. These variables include things like What city or township is the property located? Is the property flat or on a hillside? What is the subsurface of the ground made of? These are just the first few questions I have to ask when pricing jobs as a General Contractor because there could be hundreds of thousands of dollars just in these three simple questions.
Pricing a Job: The Breakdown
Have an Initial Detailed Consultation with Your Customer
First of all, when I speak to a customer who wishes to build a structure, home, accessory building or home renovation, I need to get a detailed description of what they’re trying to accomplish so that we share the same vision of the end results.
Communication is key. Once you have a clear idea of your customers needs and wants, then you can translate them to a blueprint.
Scotti’s Tip #1
If you are a general contractor, you need to understand the importance of completing drawings with clear selection before starting a project. Don’t tell the homeowners that you can do the job for a certain price without seeing the project, this is not an honest way of dealing with owners/customers.
Design Structural & Architectural Drawings
The design element is the first step to any successful construction project and accurate quote. The design process is long, and can take anywhere from 3 months to a year depending on the level of detail and accuracy expected in the quote. As a builder, I want the drawings to be as reflective as possible to my client’s vision, dream home or kitchen, before I start pricing.
Once the structural and architectural drawings are complete, I have a clear selection of details to be included in the quote, from colour to finishings.
Scotti’s Tip #2
The owners need to know that your numbers are only budgetary and based on historical data. The prices of labour and materials do go up over time. Most trades and suppliers hold their prices for no more than 30 days, and a home can take up to 2 years to build after the building permit has been issued.
The next course of action is to send out the structural and agricultural drawings to all the trades involved to request a quote from them for their particular service.
Some people may think that there are only a dozen or so trades involved in building a home. In reality, there are nearly 100 different trades and professionals involved. Therefore, presenting a fully accurate number to your customers is next to impossible. For builders who are highly experienced in the industry, an educated guess may be close to accurate; however, only if the customer does not make alteration to the plans during the ongoing project.
Some of the bigger items in the construction phase are; Framing and their material, plumbing labour and fixtures, electrical labour and Fixtures, cabinets, drywall, insulation, HVAC, etc. These trades can give more accurate numbers for the job.
Scotti’s Tip #3 for Homeowners
If you are the owner of a project, here is my advice. You will find it difficult to get a fixed number from any general contractor or home builder.
Here is the best way to receive an accurate quote from your builder:
- Design the building or space of your desire. Once the drawings and selections are finished, you can start to bring in more accurate numbers.
- Allow a contingency of 10-15% more for inflation and unforeseen items.
- Be sure to ask your contractor to provide you with a budget. Make sure you keep on top of those numbers.
- Ask your contractor for an updated costs sheet with every phase and monitor your spending. It is not the job of the contractor to make sure you don’t go over your budget, but it is his job to provide you with the data as you request it
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