8 minute read
Estimate faster, more accurately, and save time
Spending your days creating takeoffs with paper plans and a scale ruler? Waiting on your supplier to get back to you with accurate pricing for your estimates, only to find out that your customer chose another builder because they got their quote in faster? There is a better way.
Estimating is one of the most challenging — and time-consuming— yet essential elements of the job. The accuracy, or lack of it, can make or break a business’s profitability. Accurate estimating takes time, practice, skill, and reliable data because not every job is the same. An accurate estimate helps boost your construction business’s average profit margin.
Construction business owners need to monitor their overhead costs, gross profit and net profit to ensure healthy profit margins. After all, how much money a business is making is the ultimate factor when it comes to measuring whether a business is successful or not.
Adding estimating software to your business can streamline your entire estimating process, from doing takeoffs to creating estimates, to sending out professional quotes, to setting your construction business up for success. The construction industry is very competitive; so construction businesses look to drive business growth by monitoring direct costs and indirect costs.
Job costs will dictate the net profit margin and gross profit percentage. It’s very important to stay on top of your numbers and the amount of work coming in at all times. It’s also important to complete jobs in a timely manner, if you are to continue driving your business’s success.
Every construction business owner should invest in project management software to ensure the projects are well-staffed, organized and completed in a timely manner to keep customers happy and the business operating efficiently.
More importantly, you need to run a successful business. Software will help you calculate profit margins easily. You simply input all of your overhead costs and then your job costs and the software will calculate your gross profit and net profit. Knowing your profit margins will allow you to invest in your business, so it continues to grow.
You will easily see if you’re making enough profit to make a job worth it or not. This will make it easy to plan when to invest in your business with office equipment or other expenses you might have planned for in the future, but more importantly, it will help ensure you have a growing business and that you stay in business. Keeping your balance sheet in order is crucial.
We’ve outlined five tips to improve estimating, to increase your efficiency and to maximize profit using Buildxact.
1. Ditch the paper plans and scale ruler for automated takeoffs
You may have learned to do takeoffs using paper plans and a scale ruler before the rise of takeoff software solutions now on the market. This method risks human error – an incorrect calculation can cause problems once you invoice the job.
Today, takeoff software solutions, like Buildxact, enable you to be up to 80% faster while being more accurate. Automated takeoffs make estimates quicker and more accurate, ultimately paying off when it comes to your profit.
Accurately estimating soft costs in construction will, such as design, permits and surveys, design, among others, is easy with software. The improved accuracy of estimates will show up in the profit margin for your construction business. Construction business owners will greatly benefit from automated takeoffs and software, which will help them save time so they can work on other parts of the business.
2. Templated checklist for any project
A templated checklist with different categories is a great way to ensure that nothing’s forgotten in your estimate. Whether you’re creating an estimate for an extension, renovation, adding a second story, kitchen or bathroom, a checklist means you’ll be covered. Since projects differ, the ability to add or remove items on your checklist is critical.
Many builders use Excel for checklists, but it doesn’t sync to the rest of your business systems. Buildxact allows you to estimate using a range of prebuilt checklist templates. Once you win the job and manage the finances, you can view where an item was over budget, adjust the estimated checklist to avoid this on your next job. You’ll have peace of mind the first time and every time. This goes a long way in terms of taking control of your business. Knowing your gross profit, net profit, profit margin, overhead expenses, etc. is the key to running a successful business in the construction industry.
“We all have systems in place for running the operations. Those are kind of cobbled together, but having all the services on a single platform gives me the confidence to take on more projects that I know I can successfully deliver and ultimately be less stressed” – Matthew McCrimmon, residential builder and Buildxact customer.
3. Pro dealer pricelist integration
It isn’t easy to create an estimate when you don’t have access to the most up-to-date pricing. You likely rely on your supplier returning emails and phone calls so that you can check the price of multiple items and ordering materials.
Buildxact enables you to access your supplier’s price list in the online platform to create takeoffs, estimates and quotes. It saves time, increases your efficiency, and maximizes your profit.
4. The use of formulas also called assemblies
Buildxact uses a formula-based process called assemblies, where the calculations are automated, saving you tons of time. Typically, you would create a takeoff, work out the quantity of every item you need (like how many studs in a wall), and add up all the components you need (like a bottom plate and top plate).
It serves as an assistant, ensuring you never leave anything out when putting your materials list together and keep your job costs as low as possible, by buying the materials all at once, instead of having to go back to the store to buy something you forgot to buy.
Recipes package all the components together to create the takeoff, and the quantities automatically calculate, speeding up the estimating process and your accuracy. This is how software gives you time back. Time is our most valuable commodity, so anything that helps you save it and use it wisely is a good investment. To complete a wall framing estimation, trace along the wall in your building plans, and you’re good to go. It is that simple!
5. Manage your subcontractors RFQs online
Receiving quotes from your subcontractors to include in your estimate should be hassle-free. Instead of calling each subcontractor individually, Buildxact enables you to send RFQs directly and then review and accept quotes in real-time. Once you’ve selected your subcontractor’s quote, simply add it to your estimate. Streamlining this step-by-step process online saves you time and increases your efficiency.
Any more tips? Yes, one more.
Buildxact allows you to estimate using all of these features and more. Designed for residential builders and remodelers who want to streamline their estimating process, Buildxact is easy to get started and simple to use.
Start a free trial or book a demo and experience Buildxact for yourself.