View Full Version : Estimate Questions
07-22-2009, 04:46 PM
How do you go about giving an Estimate on Commercial Jobs? Would it be basicly the same as yards or should I charge more? Not to get off the subject of the estimates but what kind of Insurance do I need to look in too?
07-22-2009, 06:25 PM
I base all my lawn jobs on total time to edge, trim, mow, and blow. In my area $50 an hour is about normal. But, Im not doing a 15 minute lawn for $12.50 if you know what I mean. There has to be a minimum as well.
07-22-2009, 06:51 PM
If you're good at estimating the length of time it takes to complete a job, I recommend the cost-plus method. This is the method that I used to write estimates. The problem with using this method is it requires knowledge regarding how long a job will take to complete (and this knowledge usually comes with experience). The cost plus simply takes your base hourly labor rates, then adds percentages on top.
With this method you are able to cover all of the costs many people forget to include in their bids.
Here’s an example of the Cost Plus Formula:
Total Hourly Employee/Your Pay Rate
x 20% (for payroll taxes, workers’ comp, etc.)
= Base Hourly Rate
Base Hourly Rate
x 15% Depreciation (vehicles, equipment, etc.)
= Total Depreciation Rate
Base Hourly Rate
x 10% Administrative (accountant, invoices, office expenses, etc.)
= Total Administrative Rate
Base Hourly Rate
x 30% Profit (business growth, your bonuses, etc.)
= Total Profit Rate
Now total all these categories.
Base Hourly Rate + Total Depreciation Rate + Total Administrative Rate +
Total Profit Rate = Total Estimate for the job.
I highly recommend you adjust the percentages you use according to the market in your area, and the length of time you have been in business. As your business grows and changes, you will have to adjust these percentages.
This is a little difficult to explain on paper. Let me know if you have any questions, or if I need to clarify something.
Check out www.LawnSuccess.com (http://www.lawnsuccess.com/commercial_video2.php) for more info on
getting commercial accounts.
07-22-2009, 09:39 PM
I'm getting pretty good at estimating lawns and I go off a rate of $40Hr my minimum is $35. Flower beds set me back alittle due to lack of experience on my part being new to this and all. I just add a certain amount of time for each object in the yard I can't mow close to and I get my time within about 10 to 15 minutes of what it actually takes me. I was just wondering it I should charge my normal rate or a higher rate for commercial jobs. Thanks for the help I appreciate it.
07-23-2009, 11:16 AM
Your normal rate seems a little low, but many not be. Everyone talks about $1.00 per minute as a minimum, which is a good goal, however, not everyone carries the same overhead.
Using your normal $40.00 per/hr rate may be fine on a commercial job, if you don't have any increased expenses directly resulting from this job. (ie. additional insurance, equipment, labor, etc.)
I always billed my commercial accounts on a monthly basis, with a 12 month agreement. If you are going to provide an estimate based on 12 month service you'll need to adjust your bid a bit.
Calculate your per service price for each service you'll provide. (general lawn maintenance - mowing, edging, trimming, trash, weeding beds....then calculate the per service price for each other service - trimming hedges, fertilization, etc.)
Now total the number of times per year you'll provide each service. For example:
You may estimate general lawn maintenance at $50.00 per service. Then multiply that by the number of times you'll perform that service each year.
Example: You may maintain the account weekly in the summer which might be 20 service calls. And you may service them bi-weekly in the winter, which may be another 16 service calls.
You would have a total of 36 service calls at $50.00. For a total of $1,800.00.
Then simply repeat for each other type of service you'll provide. For example: You may trim hedges 4 times per year at $100.00 per time. So your annual total would be $400.00.
Then you would simply add all of your service totals together and divide by 12 to get your month billing amount.
Let me know if you have any other questions.
07-25-2009, 01:04 AM
I I was thinking I might use $50hrly rate for the commercial accounts and keep $40hrly for my residential accounts.
07-25-2009, 04:22 AM
Around here you have to bid commercial accounts pretty competitevely in order to get them. Residentials, not so much. I like a good balance of both.
07-25-2009, 05:16 PM
I'm just trying to get some ideas about getting commercial accounts right now. We're staying residential for now, we just started putting out signs to advertize this weekend getting a late start.
07-25-2009, 10:22 PM
you will have to make a list of EVERYTHING and have it signed off on....
Dont screw this up. you could find your self in serious trouble.
PM me and I will send you a sample contract you can use as an exzample.....
dont try to do calculations based on residental accounts. the libilaty is HUGE with some proptries.... you need to raise your prices for this....
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