Leveraging Software to Faster Bids, More Profit
By implementing software to automate the construction takeoff and estimating
processes, contractors are realizing a significant return on their
technology investment. With seamless solutions, construction companies can
save valuable time and improve accuracy, as estimators can bid more jobs
quicker with a competitive edge and profit margin. Also, the software helps
contractors to submitting future bids that best fit the type of work using
insight gained from historical data analysis of each bid, how the company
performed the work, the costs posted, the profit ultimately realized on the
job, and more.
An automated solution, using digital plans, allows estimators to never
touch a piece of paper and seamlessly roll the measurements and quantities
calculated in the takeoff process right into developing the estimate. With
the takeoff data pulled directly into the estimating process, duplicate data
entry is eliminated, errors are prevented, and time is saved.
Additional productivity and accuracy benefits will also result with an
automated solution that provides built-in tools for easily managing
historical pricing data, costing jobs properly, generating proposals,
manipulating proposal pricing on-the-fly on bid day, and producing reports.
Contractors using manual methods are spending hours or days taking off
items by hand and then when it comes time to determine what the job will
cost, they are only able to guesstimate the numbers. This can cause mistakes
throughout the estimate and make it extremely challenging to identify and
fix them. Requiring so much time to complete an estimate also translates
into less time available for considering “what-if” scenarios and negotiating
the process enables contractors to reduce the time needed to complete
estimates, which means a reduction in overhead expenses; as well as allows
them to get more bids out the door. The more bids submitted, the higher the
chance more jobs will be won. Estimators will have more time to thoroughly
analyze their estimates as well, finding new ways to generate more profit on
Overbidding and underbidding projects can both present problems. If a
bid comes in too high, there is a likely chance the work will not be won. If
a job is bid too low, the work may come in, but most likely, the job will
cost the firm money. Therefore, the importance of accurate takeoffs and
estimates is evident.
Matt Elfreich, estimator and project manager at Klenck Company based in
Indiana, commented on his previous manual takeoff and estimating methods,
“If one formula was off, it could make a huge difference; especially on bid
day, when you’re running around like your head is cut off. One wrong number
could significantly impact a job.”
using an automated takeoff and estimating solution that handles the
measurements and calculations, as well as stores real-time pricing
information on cost items including materials, equipment, and labor in one
central location will help produce more accurate estimates that win more
jobs, and result in more profitable projects.
Klenck Company now uses Maxwell Systems ProContractorMX as its software
solution. ProContractorMX is designed to empower contractors by
significantly improving their takeoff, estimating, and proposal management
Elfreich explains how ProContractorMX has reduced the time to develop an
estimate from about four hours to just one hour: “We simply do the takeoff,
plug in the numbers, do some manipulations based on the specific job, and it
calculates the numbers for us. It is by far the nicest part of the
Tracking and Using Data
It is almost inevitable that disagreements arise on construction
projects, whether with the project owner or with the other contractors on
the job. Any paper-based method of taking off and estimating jobs makes it
extremely difficult to support the details in the original bid, and if the
data is available, it often takes significant time to locate it in the
mounds of information used to develop the bid.
Today’s advanced takeoff and estimating software solutions provide audit
trail capabilities that make it easy to reference when a dispute arises.
They also provide the financial department and project managers the
necessary information to execute jobs as originally planned.
Before implementing estimating software, Florida Paving & Trucking struggled
with paper-heavy processes, which impacted time and accuracy, as well as
lacked the data needed to understand how to produce profitable bids. Now
using Maxwell Systems ProContractorMX software, Florida Paving has a
seamless process that eliminates the time and errors associated with
re-entering information, often needed if using manual methods or disparate
Tony Martinez, estimator at Florida Paving, explains: “ProContractorMX is a
good source of data for us to determine where we made mistakes and how we
can do things better. Using the solution, we can gather data, such as what
types of jobs give us the biggest profit margin and what are filler projects
for our crews, and determine whether we have the cash flow we need.
ProContractorMX is a real time-saver and helps us run our business more
Decisions and Insight
Looking back at past estimates that were done on paper or in
spreadsheets can make it very challenging to determine whether a project was
profitable or where money was lost.
A seamless takeoff and estimating solution manages data in one central
location that’s easily accessible, so projects can be carefully tracked as
they progress, enabling project managers to make timely decisions based on
the original estimate. After a project is complete, the historical data can
be analyzed to determine where profit was made (or not made), and new
estimates can be generated based on past experience. Furthermore, this
valuable data can help a construction firm determine what type of jobs they
do best and whether they are spending time on bidding the right jobs.
According to Florida Paving’s Martinez, “In the past, we would get out bids
on jobs and not know how to win the work or what was a smart bid. We didn’t
have the data needed to understand how to be profitable. It was all on paper
that we were shuffling back and forth. Now, with ProContractorMX, we are
able to look more carefully at the scope of work required and develop more
competitive bids. We can easily go back and look at the data and feel
comfortable with making decisions on how to proceed.”
Reaching Full Profit Potential
In a competitive construction landscape, contractors can’t afford to let
money slip through the cracks. ProContractorMX enables contractors to bid
jobs quickly and accurately to help them reach their fullest profit
The full breadth of the solution goes beyond takeoff and estimating to also
offer project management and accounting to deliver to contractors the
industry’s only true all-in-one construction management software solution
that handles the entire project lifecycle from end to end.
By empowering construction teams to communicate faster and react smarter,
contractors will be better positioned to succeed and grow than if they stick
with the antiquated methods of yesteryear.
About the Author
Mike Gillum is Director of Product Management; Estimating at Maxwell
Systems, a leading provider of construction management software solutions.
He can be reached at email@example.com.