Electrical Estimating Blog
Electrical Estimating Blog covering various topics on running an electrical contracting business from organization to time management and more. Check back often for new blog posts.
Outsource electrical estimating services can usually save you about half the cost of hiring a full time estimator. This will also provide you with the resources to bid more work which should help you win more jobs.
Stan Shook wrote an article in the February 2006 issue of ECmag titled: "Hire an Outsource Electrical Estimator".
In this highly competitive industry, you need to bid more work than you are capable of doing. Most of this work comes with unforgiving deadlines and requires many hours of estimating. Hours you don’t have. Estimators you don’t have.
So, what do you do when you need another estimator or an entire team? You just can’t pick up the phone and hire one. Or can you?
One solution is to hire outsource estimators. Outsource estimators can quickly fill a void in your estimating department, add to your estimating team or become the estimating department you lack.
How can I trust their work?
As owner of an outsource estimating firm, I have talked to hundreds of contractors about this service. Three concerns are commonly expressed: qualification of estimators, confidentiality and liability on mistakes.
I respond to the qualification concern by asking, “How would you qualify an estimator you want to hire to work at your office?” The answer: You review resumes, interview them and contact any references they provide.
It is the same for hiring a outsource estimator; you need to interview them. Get references and background information. Ask them how they estimate and what types of jobs they have worked on. Ask for samples of their work—something you probably can’t do with an estimator you hire off the street. Regarding confidentiality, your “in-house” estimator has access and is privy to far more confidential information than any outsource estimator. In fact, you can control the flow of information better with an outsource company than you can with your own employees.
The liability concern is valid, but is a nonissue. What is the outsource company’s liability if they make a mistake? Don’t be surprised if you’re told they are not liable for anything as it is simply “estimating.” Do they carry Errors & Omissions insurance? Insurance is very expensive and makes the service cost prohibitive, so it is unlikely they will have it.
The fact is your own in-house estimators don’t carry any liability for their mistakes. If they make one you can’t deal with—you can fire them. It is the same for outsource estimators; if they make a mistake you can’t deal with, you can replace them.
Get a quote and check the price
Most consultants will charge an hourly rate and provide estimates on what they think the overall project will take. There are also firms that price projects based on the number of E-sheets, charging their flat rates against so many hours per sheet. Some firms base their pricing on the final sell price or bid value of the project. Whatever the process, I highly recommend getting a price quote prior to ordering the work.
Is the price right?
Keep in mind that you are hiring this company to help you fill a void in your own staff, to be able to bid an important project and still allow you or one of your estimators to go on vacation, or to get two jobs bid when you were only able to handle one in-house. There is a premium to pay for this and you should not expect the price-per-job to be the same as it would be if you or your in-house estimator did it. The greatest thing about outsource estimators is you only pay them when you use them, whereas you are always paying for the full-time estimator you hired. Your competition uses outsource estimators. Still not convinced? Consider this fact: many of your competitors are already using outsource estimators to bid and win more jobs.
Will I win more jobs?
Yes, no, maybe. There are no guarantees in bidding. However, you should be able to bid more jobs; therefore you should win more jobs. But don’t expect miracles. Outsource estimating is special to me. For the last eight years I have done nothing but think, talk, write about and practice it. I have marketed it at trade shows, sold it and am trying very hard to perfect it. I am in about as deep as anyone can get into this field and I hope to someday be known as one of the best in the industry. I do truly believe in it and so do my many clients. Maybe I am a bit biased on the subject, but I highly recommend using this great estimating solution.
Estimating Solutions is one of the few electrical estimating companies that share that same quest. We are continuously upgrading our technology and looking for ways to fine tune the electrical estimating process.
Please contact us today for more information on our services.