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Understanding the Estimating Process - Part 2 of 12

Understanding the Estimating Process - Part 2 of 12

Understanding the estimating process from start to finish

Last month, we discussed the first step in the estimating process — getting to know your business. Now that you’ve assessed your business, know your overhead, and have a deeper relationship with your accountant, you’re ready to take the next step. Sure, you know your business, but the question is, “Do your potential clients know you?”

We know price is a big driver in purchasing decisions; however, when a general contractor, developer, construction manager, or owner is faced with two similar prices — and they know one company over another — who is more likely to get the contract award? You guessed it: the one with the relationship. In addition to knowing potential clients, it also helps to make your expertise known. If you have a long company history in the type of work you’re bidding, don’t be shy — promote this fact.

As in any business, but especially in the construction industry, the power of relationships is significant. Relationships help you find the private jobs as well as jobs general contractors may already have. Contractors who have remained busy despite the economic downturn have put time and effort into building and maintaining relationships with their client base, making it an integral part of their business — not just something they do in their spare time.

Just as many contractors have viewed the task of getting to know their business as daunting, some may feel the same way about establishing, building, and maintaining relationships with clients. The truth is all you need is time. With a surprisingly small amount of effort, you can build profitable relationships, just by making this goal a priority.

The cold-call method is a great idea. Although you might not get to see the person you’re calling on, you can leave your business card, some company information, and even a box of doughnuts for the office staff. Once you get your foot in the door, be prepared to bid a few jobs before you’re awarded one. This is the contractor’s way of getting to know you as he watches how your prices come in. Watch for potential new clients when you’re driving around town, and stop to introduce yourself. Check out construction sites too; it’s all about being in the right place at the right time.

Clients can also get to know you with documentation about your company. A simple folder with slips sheets detailing your staff, capabilities, tools and equipment, and past notable projects is a good start. For the more creative, develop a professional brochure. If you don’t have experience in graphics, contact your local college. There are always students willing to share their craft at a reasonable price to gain experience for their portfolios. A website is another area that can greatly add to your company’s credibility.

Don’t forget good old-fashioned networking either. A great way to meet new clients is through networking groups, such as the Chamber of Commerce, the Rotary Club, the Elks or Eagles, and other social organizations. Chances are you’ll meet someone that needs work done or knows of someone who does. Check out the Associated Builders and Contractors ( and the Associated General Contractors ( organizations. Both represent all specialties within the U.S. construction industry and are comprised primarily of firms that perform work in the industrial and commercial sectors of the industry.

Whether you choose cold calls, social clubs, industry organizations, or a combination approach, these methods will undoubtedly introduce you to potential clients. One word of caution: When you get the chance to bid, don’t expect to get a job right away. That doesn’t mean you should give up. One day your persistence should pay off. In this day and age of non-personal communication (think texting), it’s still important to put your face to your company’s name and be able to explain why someone should do business with you. It’s a lot easier for a client to say “no” to someone they don’t know. Make it your business to get to know them, and do everything in your power to become indispensable.

Next month, we’ll discuss knowing when to bid (or not to bid) a job based on job requirements, such as bonding or pre-approval, and the signals you receive from those who are soliciting a proposal from you. Stay tuned!

Candels is president of Candels Consulting, an electrical estimating consulting firm in Niantic, Conn. She can be reached at [email protected].

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