Your complete guide to estimating, Lesson 1 of 7: The foundation of great estimating
"Designing your company around repeatable, predetermined processes that follow predictable steps to known outcomes is great for accurate estimates."
October 24, 2019 by Robert Koci
Over the next seven weeks I will be bringing you my seven part series on estimating. This series was originally produced as a video podcast. If you have any questions from this series, please contact me at firstname.lastname@example.org
I have been part of the remodeling and custom home building industry for over 40 years now, 20 years as a trade and remodeler and 20 as writer, editor and publisher. I’ll start this series with an overview of the three foundations to solid estimating. After that, we’ll drill down to details of accurate effective, profit building estimates. but before I get into it, I have to lay down a cardinal rule without which you will never be able to develop an accurate, repeatable, scalable estimating system.
Here it is: Be organized.
Foundational to all good estimating is good mental and physical housekeeping: clean desks, organized paperwork, blocked out time, an office that runs on a predictable timetable… you know… frankly, the things that are basic to good business practices. Stuff that has to be in the DNA of anyone who wants to run a renovation company AND predict the future with numbers, which is what estimating is.
Are you organized? Are you the kind of person with the discipline to work through a repeatable process protected from silly errors that have big consequences? If not, stop reading now, think about your work place and how you conduct business and redesign your processes and practices.
Now, being organized can mean different things to different people. Here are the kinds of things I am referring to:
- Do you have a daily routine? As the owner of the company, you can be in the office when you want, but can you? Maybe not if you want to build a culture where predictability and organization is the norm.
- Establish job descriptions for all your employees. Are we talking about estimating here? Yes and no. Good estimating starts with these fundamental things. You won’t generate accurate estimates if you are guessing about what your employees are doing on site.
- Designing your company to focus on a narrow band of projects. You might do only kitchens and bathroom, or just decks, or stick with basement remodels. Designing your company around repeatable, predetermined processes that follow predictable steps to known outcomes are great for accurate estimates.
This may not SEEM like estimating advice, but it’s fundamental to good estimating and needs to be done. So, are you there? Then you are ready to carry on to lesson number two.
Next week: Lesson 2: My $30,000 mistake