Itemized estimates/quotes

[tbellemare]

I've performed, sold, staffed, and sold/performed a lot of services for many years and lots of cultures.

Just about every comment I've seen in this thread so far is spot on... For certain situations.

I could be all wet but my view is that each situation is different and you get better at reading the customer(s) as you gain experience. I also think that there are certain rules/axioms that are appropriate when dealing with customers or potential customers. I would suggest that they are pretty universal across most cultures...

• Be polite
• Be fair
• Be firm
• DON'T ARGUE!!!!
• Be prepared to walk away
• Allow negotiation but stand your ground where it matters

I think every situation is different but they all have many similarities...

• Something for nothing is deemed to have no value (at least, monetarily)
• Value is deeper than is often obvious
• If you can't justify the value, maybe the value doesn't exist
• If you're reticent to justify the value, you might think it doesn't exist
• Everyone wants a deal
• The best deal can be justified with quality
• If the customer/(potential customer) can't see the value or won't admit they see it, and you know how to explain it, WALK AWAY! They are likely looking to take advantage of you.

EDIT
If you have to walk away because you can't get your prospect to see or admit value, you should take a break and reevaluate the entire negotiation. If possible, enlist the help of someone whose advice you respect to aid in the reevaluation.
END EDIT

There are many ways to look at things but most people I see on this forum appear to be in service roles. If you make your living on service as I have for a long time, you have to know what you're worth and know how to express that. Most of the craftsmen or artisans here are exceptional and deserve serious recognition. They should not be in competition with some casual pretender.

'Sorry for the rant, that's just my two cents.

Tom

 

[Holzhacker]

It's pretty rare for me to give itemized quotes. I used to do it more years ago when I was less experienced. Nowadays I only do it for compliance, i.e. Gov. or Corp. work. The breakdown is irrelevant. It's just a way for a client to try to nickel and dime a contract. I don't have time for that. My pricing is consistently middle of the work or slightly above. There are far too many factors that go into a bid that clients don't know or understand. Overhead for the truck, new planer blades, another demo hammer for this job, etc. I don't tell clients an hourly rate.
A few weeks ago, a prospective client wanted me to jump through hoops to get her job. I told her flat out I don't work like that, I don't have time for that nonsense, she can play those games with somebody else; $48K job. I don't care.
I've been in this business my whole life, made a lot of mistakes, lost a lot of money on jobs and learned a couple things along the way. I am extremely fortunate in that I have a good client base and don't have to grovel in the dirt too often anymore. There are a lot of con artist contractors out there and usually they are the best salesmen.
- don't try to compete with your competition who actually isn't your competition; be able to explain to a client why scumbag contractor can do the job for so much less
- itemized quote, waste of time
- choose your clients just as clients choose you, I won't work for everyone who calls and will turn down clients if I smell a PIA
- be nice, be honest, go a good job, go the extra distance even if it costs a few dollars more; some clients appreciate it, others oddly don't at all, either way it usually provides a good referral base
- know your numbers, know your business; X only costs so much at HD, why are you charging Y; because what I am installing is better than the crap at HD
- work towards your desired client base;
- document everything you do, take pictures of cavities before they are closed up, keep records
gotta go

 

[Tinker]

When i was in construction, I sometimes ran into situations where a client wanted a breakdown of the estimate.  With my proposal, i had itemized the project in sections;
Site work such as clearing of trees & brush
Excavation
Footings
Foundation
Fireplace and chimney
any thing else that was in the specs.

I would list the limitations to any part of project that might have questionable approach.

I gave a bottom line price
All extras would be included under an add on price
I did not give a total price covering basic proposal AND the add-ons price.
two separate prices

If the prospective customer insisted on a breakdown, I would go home and do the itemizing, add 5% to 10% (or more) to each item with the total shown if the job were to be broken up.
The original price i had given would be only if ALL of the original proposal were to be done by me, my crew and MY subs.

I was never out of work unless i needed some time off.  now i am in a different biz, i still manage to keep as busy as i need to be.  Trying to wind down, but still busy.
Tinker

 

[rnt80]

I have to say that I am extremely grateful and humbled at the wealth of advice that has been shared in this thread.  While I don't do this kind of work exclusively for a living it does occupy a lot of my time.  With that said I only know one or two other people in the business that I can bounce stuff off of.  Because of that I feel very fortunate to be a part of this community where so many other people, with so much more experience and expertise than me, are willing to share their lessons learned and methods of doing business over the years.  As some of you have said mentioned throughout this thread so much of this is a learning experience for me.  I'm glad that, in some respects, I have the shoulders of others to stand on in situations like these.

 

[Tinker]

Altho I was used to lifting heavy weights while in my masonry Biz and was about 7' tall when i started, My shoulders are no longer very much above the ground.  To be sure, you better find others shoulders to ride on.  I will just supervise.  : [thumbs up]
Tinker

 

[Sparktrician]

I've contracted a lot of work to a carpenter I know on several projects around town and he always produces an itemized bid with materials and time broken down per task. I've never turned his bid(s) down but I think it's better practice to get it all out in the beginning. That way, if I think he's missing something or is getting carried away on something, we can fix it before the project starts. It eliminates any bad feelings when some unknown or scope change occurs.

Tom

One company I used to work for required itemized bids from all subcontractors for exactly this reason.  Subs that turned in unitemized bids were dismissed summarily.  It was good in that it got rid of subs that didn't read the requirements, and hence, we could count on tighter adherence to the requirements. 

 

[peter halle]

I've contracted a lot of work to a carpenter I know on several projects around town and he always produces an itemized bid with materials and time broken down per task. I've never turned his bid(s) down but I think it's better practice to get it all out in the beginning. That way, if I think he's missing something or is getting carried away on something, we can fix it before the project starts. It eliminates any bad feelings when some unknown or scope change occurs.

Tom

One company I used to work for required itemized bids from all subcontractors for exactly this reason.  Subs that turned in unitemized bids were dismissed summarily.  It was good in that it got rid of subs that didn't read the requirements, and hence, we could count on tighter adherence to the requirements.  

Years ago when I was a PM, the bids from GC's had to have category cost breakouts.  We would whittle the 5 contractors down to 3 and then talk to the contractors and without telling numbers would ask about categories that were out of whack in comparison - both high and low.  We gave the contractors the opportunity to investigate and if needed make pricing changes.  We did not do it to get a cheaper price.  I can tell you that the contractors appreciated that we were looking out for them as well as for us.  Darn I miss those days!

Peter