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Contractors & Contracts

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Architects & Engineers - Articles & Advice. Residential Architect - home architect, hiring, costs, & fees. General Contractors, Remodelers, Specialty Contractors Business Help. Estimating Training for Construction. An accurate estimate is the first step in selling and building a profitable job.

Estimating Training for Construction

When you know how to estimate a job properly, nothing is forgotten. In these construction estimating training classes taught by Michael Stone, you'll start with a small job (under $12,000) and build skills as the jobs become more complex ($1.2 million remodel). Michael has taught estimating to contractors in 44 different states and Canada. The Profitable Estimating class is 12 hours of training, but it isn't just videos.

The ability to estimate a construction job is a skill developed with practice. The Profitable Estimating training classes are available in DVD format for viewing on your computer and are also available as an online estimating class. If you prefer the DVD, you can receive a username and password to access the online classes while you wait for the DVD package in the mail by sending us a note after purchase. The DVD and the online class are identical. Labor is so difficult to estimate. Applying Markup to Material Costs. I'd like to share a letter from a contractor trying to put the pieces together and make his business work.

Applying Markup to Material Costs

You talk about the importance of having a consistent markup. Let's say I have a small paint job that requires two gallons of paint. The paint costs $30 per gallon and my markup is 1.4. That would be $24 markup. It takes me five minutes to order the paint on the phone, and five minutes to pick up the paint. If the customer purchased their own paint to save money, yes, you should turn down the job. Watching Your Client's Budget. A reader sent a note last spring explaining a situation with a potential client.

Watching Your Client's Budget

I'm sharing this because it's a fairly common occurrence and it isn't always this obvious. "Our company has many of your products and they have all helped grow our remodeling business. Hiring A Contractor - What You Need To Know. Last weekend our friend Bob Youngs showed us an article published in the June 2016 issue of Consumer Reports.

Hiring A Contractor - What You Need To Know

Portions of the article are available online, although the printed version is more detailed. The article is written as advice before hiring a contractor, and some of the advice is spot-on: Bring your contractor into the project during the design phase (if working with an architect). "An experienced GC will help you head off things you can't afford before you pay for finished drawings. "Get everything in writing.Changing your mind after the work is underway is the biggest mistake homeowners make, and it can be the costliest, too.Deal with your general contractor, not your subcontractors. Markup Isn't Profit, or How Much Should a Contractor Charge? We realize that many of our website visitors aren't contractors, they are the clients of a contractor.

Markup Isn't Profit, or How Much Should a Contractor Charge?

They are generally either looking for help with their Cost Plus project that's gone wrong, or they're trying to figure out if the price they were quoted (or charged) is reasonable. Construction Insurance Repair Work. A coaching client shared two recent experiences while doing insurance repair projects.

Construction Insurance Repair Work

The first experience shows that sometimes it can go well: Construction Contract Allowances. A recent note: "I have both of your books but haven't seen a good plan or section on how best to work allowances with a client.

Construction Contract Allowances

Currently we show our cost as the allowance on our contracts, estimates and design agreements. What happens when they go over the allowance, or under the allowance? We Want to Get Three Bids. Our family went through a time when we did a lot of business with a local auto body shop.

We Want to Get Three Bids

That's when we discovered that we didn't need to get three bids; we could choose the shop we trusted. It was perfect; we knew them and they knew our cars. Construction Pricing and Sales. When it comes to pricing your jobs, you need to keep it simple, especially if you want to make the sale.

Construction Pricing and Sales

This contractor didn't keep it simple: "I met with a contractor today and have questions as to whether or not I should hire them. This contractor has multiple fees. Is this normal charging? Client Wants the Lowest Price. Some clients want the lowest bid for their project, and nothing else matters.

Client Wants the Lowest Price

Forgive me while I paraphrase John Wayne, "They are just ignorant, they don't know any better. " It's your job to try to educate them Your first response upon discovering that they only want the lowest price should be to find out why. They might tell you, "I just want the cheapest price I can get. This job will get done the same no matter who does it, so I'm keeping my costs down. " They believe all contractors will build the same job, the same way. Cleaning Up After a Low Bid Contractor. I got a note from a good friend the other day, he wanted me to review a request he had received from a potential client. This potential client had a house built using the "lowest bid" contractor. The builder cut corners, leaving out little details like collar ties on the roof rafters. Yeah, just little details. Of course, the walls are now pushing out and leaks have occurred. You get what you pay for.

So, this potential client is looking for bids on what needs to be done to fix the problems. Government Advice On Hiring a Contractor. A recent online article from Louisiana gives advice to homeowners on how to protect themselves from contractor scams. The article was triggered by complaints about contractors receiving payment but not completing the work. Most of the advice comes from the state attorney general and the Louisiana contractors licensing board. We've seen similar articles from other states. In my opinion, these bureaucrats are dealing with the effects of a problem rather than the cause.

Make it Up with Change Work Orders. I'm hearing far too often from both contractors and clients about contractors deliberately underpricing jobs so they can come back later and write change work orders at inflated prices. They do this so they can sell the job by having the lowest price, and use the change work orders to recoup some of the money left on the table by their original bid. This practice isn't new. My grandfather related to me many times that this practice was prevelant when he owned a contracting business years ago. Construction Contract Advice on Prices, Quoting. Just a quick reminder. Be sure to put a limit on the length of time your proposals are valid. That time should be a maximum of 3 working days, no more.

Storm Damage can be Opportunity to Reconnect with Previous Clients. A national construction-industry magazine posted a note that said about half of their subscribers were in the path of Hurricane Sandy these past few days. Which leads me to a question: How many of those contractors are taking advantage of the potential new business? Let me share some thoughts. Storm damage may or may not be the kind of work you like to do, but it is work.

I've said many times that the smart contractors, the ones who make good money, focus on their most profitable work, whether or not it's the work they like to do. Insurance Restoration Contracting: Startup to Success Book + eBook (PDF) - Construction Manuals - Books and Software - Craftsman Book Company. Insurance Restoration Contracting: Startup to Success. Free Estimates. Construction Cost Plus Contracts, T&M, Time and Material. Why Itemizing Estimates for Construction Projects are a Bad Idea. By Michael Stone When a client asks for itemization, they normally add the phrase, "So we can compare bids. " Right. Adjusting Your Markup For One Construction Job. In Markup & Profit Revisited, we explain how to calculate the markup you need to reach the sales price for your jobs.

A common question we receive is whether or not you should adjust your markup based on the length of the job. Recommended Reading for Construction Business Owners. Thou Shall Prosper, by Rabbi Daniel Lapin. Transparency is More than Itemized Estimates. Should Contractor Add Markup to Customer Furnished Materials? A recent note said, "The client wants to furnish all the materials. Cost Plus Contracts Video Clip. The Vendor Client Relationship. Generic CUSTOM KITCHEN CABINET AGREEMENT.docx. The Remodeling Market has Changed. Construction Contract Allowances. Payment Schedule for a Construction Contract. The Finer Points of Change Work Orders. We have discussed Change Work Orders for several years now, but new stuff keeps cropping up. Let's take a look at some of the new things that have come our way. First - We continue to hear from contractors that insist on sending out invoices and bills for their work, and that includes CWO's.

Sooner or later, probably sooner, that practice is going to bite you right in your assets. When Clients Want Cost Plus. Should You Markup Subcontractor Quotes? Home Improvements and Remodels. Lovette Construction's Projects. NARI - National Association of The Remodeling Industry. 10 Things Every Remodeling Contract Should Include. What is essential to include in remodel contracts? Generic CUSTOM KITCHEN CABINET AGREEMENT.docx. 40 keepitup. Design/Build Additions & Home Remodeling in Lincoln, Nebraska. 40 keepitup. Contractor Fees, Demystified. Material Cost Calculators -

Contractor Talk. Building Construction Specialties. Construction Contracts: What to Know About Estimates vs. Bids. Bathroom Workbook: How Much Does a Bathroom Remodel Cost? Learn the Lingo of Construction Project Costs. How Much Does a Remodel Cost, and How Long Does It Take? Learn the Lingo of Construction Project Costs. 10 Questions to Ask Potential Contractors.