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View Full Version : Patios at Townhouses! They can suck up profit.


DVS Hardscaper
07-31-2011, 05:38 PM
I'd venture to guess that we probably do 1 to 2 patios at townhouses per year.

200 to 300 SF patios. What can go wrong, how perfect for the rookie patio guy just getting his feet wet!

Well, we did a patio at a town house last week. Didn't go so smoothly. I haven't entered the numbers into the job cost sheet, but I would be surprised if I cleared 6% net profit.

New, luxury, 3 level townhome community. The house we worked at was the 2nd one in from the end. The house we worked at had an empty pad (for more houses to be built) next to their island grouping. Meaning we had plenty space to dump gravel and to access rear of the island town houses.

The grass in the common area is well established. So we used my 3,000#, 35 hp, New Holland compact utility tractor instead of using a 7,200# skid steer that would have destroyed the turf and torn up the ground. Not as productive as a skid steer, but it saved us from destroying the common area and from having to spend 3-4 hrs regrading and seeding the HOA'S common area.

Also, it was 95-103 degrees all the days we worked there. No trees for shade, Full afternoon sun beating down.

My guys worked their tails off. Consistant production, taking very few breaks, and working at a really good pace.

The patio we installed was a radiused 300 SF. It needed a small 12" high retaining wall because the grade sloped away from dwelling. And required 15 tons af aggregate (as was estimated) for the gravel base and to level off the slight slope.

Townhouse patio, 300 SF, TOOK 4 days to build!

Such a harmeless sounding patio. Yet it was a profit killer.

Townhouse patios and front walkways can rob you of profit if you don't know how to price them. It's hard to tell someone that the 300 SF patio they want behind their townhome will cost them $7500.00........


And....an example of where unit pricing (known as per square foot) can bite you in the tail.



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SVA_Concrete
07-31-2011, 06:22 PM
the small jobs always bite the worst.

even pouring cast in place walls. last month we poured out 35 yards flawlessly, and then go to pour a 3 yard wall and she blows out!!

zedosix
08-01-2011, 09:15 AM
Unit pricing ahhh, gotta love it. I had a bbq this weekend with my ex-business partner and we were discussing the old days. One story in particular was a 60sq.ft. walkway with 3 concrete steps. We priced it at $5sq.ft (1987) and it took us a day and a half to do it. Nearing the end of the job we cracked one of the steps and had to drive 30 miles to get another one and replace it. Needless to say we didn't turn a profit, actually it cost us to do that job. Soon after we were asked to quote her back patio and when we gave her the #'s to do it she was blown away at our price. This is still the way people think today, unit pricing, the contractors use and and the home owners use it. Basically your screwed if this is the method of estimating.

GreenLight
08-01-2011, 12:53 PM
I have never fully understood the whole beef with unit pricing. Theoretically, it doesn't have to be any different than T & M pricing. It's just a matter of cross referencing in estimating. If you are doing a 100 sq. ft patio and you estimate your materials, man hours, overhead and profit to total $2500.00 dollars, then it's pretty basic to come to the conclusion that your total price is $25.00 per square foot. This number might not be the number you want to present to a customer, but it's still the unit price of installation based on what you have acquired from your base figure.

This doesn't mean that every job is $25.00 per square foot, simply implies that based on the order of operations necessary based on scope of work, this is what it will cost this job.

jeffslawnservice
08-01-2011, 12:59 PM
A lot of the work in my area is like that. All small twin houses, no way to get a skid, tractor, or mini ex back there. A few were had very steep hills on the side yard and you could not even bring in a dingo. A lot of people look at me like I am nuts when I say such a high price, but when you have to do everything by hand the costs add up. For bigger jobs at properties like this I am looking into the use of a crane to move material in and out of the backyard. Still need to run numbers to see how much time it would save vs. the cost of renting a crane.

PatriotLandscape
08-01-2011, 04:35 PM
I have never fully understood the whole beef with unit pricing. Theoretically, it doesn't have to be any different than T & M pricing. It's just a matter of cross referencing in estimating. If you are doing a 100 sq. ft patio and you estimate your materials, man hours, overhead and profit to total $2500.00 dollars, then it's pretty basic to come to the conclusion that your total price is $25.00 per square foot. This number might not be the number you want to present to a customer, but it's still the unit price of installation based on what you have acquired from your base figure.

This doesn't mean that every job is $25.00 per square foot, simply implies that based on the order of operations necessary based on scope of work, this is what it will cost this job.

Unit pricing fails because we do not work in a factory.

If I owned a paper cup factory then I would know exactly how much it cost me to make each cup. The factory is the same everyday.

In landscape construction the factory can be up a hill, down a hill, rain, can have a house in the way, etc. that is why we should not use unit pricing.

you can figure out what your square foot price is on each job but it really has no impact on the next job.

GreenLight
08-01-2011, 04:42 PM
Unit pricing fails because we do not work in a factory.

If I owned a paper cup factory then I would know exactly how much it cost me to make each cup. The factory is the same everyday.

In landscape construction the factory can be up a hill, down a hill, rain, can have a house in the way, etc. that is why we should not use unit pricing.

you can figure out what your square foot price is on each job but it really has no impact on the next job.

I don't disagree at all and I agree about the downfall of fixed rate unit pricing. That being said if we are simply talking "terminology" that is common to the industry, just because someone gives a square foot quote, that doesn't mean that is a fixed quote for every job. I have customers ask me for square footage pricing all the time and I oblige them by taking all of the estimated numbers and ultimately coming to that figure through cross referencing. As has been stated, sq ft pricing is often what is known in this industry by customers and is often what is quoted, but it doesn't have to be based on a fixed unit pricing model. As I stated before, If I add up all of my variables for labor hours, materials, overhead and profit then divide by square feet I have produced a number. It's something the customer is certainly going to do anyway.

DVS Hardscaper
08-01-2011, 05:39 PM
Greenlight,

its appearing you're getting "averaging" confused with PRICING.

I think we all know what our jobs "AVERAGE OUT" to be.

But you can't take a small, tideous property and use that average cost, as you'll lose your backside.

I've looked at jobs with easy access, smooth sailing, and I've known it will average out to so much per SF. But I don't use that for a price. I still turn on the computer and I enter in production hrs and the materials are calculated.

And no, the general public DOES NOT know SF pricing. Most competent contractors are careful not to go that route with prospective clients, as that can be misleading.


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White Gardens
08-01-2011, 05:54 PM
This is a great conversation DVS.

I've run into that problem multiple times where I've bid really high to account for the BS of installing a patio.

I always thought I might be out-pricing myself, but the last couple of jobs I've done I've learned there is no such thing.


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DVS Hardscaper
08-01-2011, 07:05 PM
I don't like to turn down work. Small job big job we do them all. But it's amazing how a 300 sf patio can practically cost as much as a 500 sf patio. It's the variables that must be factored, and the variables are never wrong.

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zedosix
08-01-2011, 07:44 PM
hrs and the materials are calculated.

And no, the general public DOES NOT know SF pricing. Most competent contractors are careful not to go that route with prospective clients, as that can be misleading.

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In my area its what the customers want to know, "how much per sq.ft."
And I know many contractors in this trade are still using it. The same goes with pricing of retaining walls etc. It can get you into trouble on the small jobs and you can make a fortune on the larger ones.

DVS Hardscaper
08-01-2011, 07:58 PM
I can't speak for other markets.

People do ask me "how much per Sf", but I'd say it's maybe 2 out of 10. But that might be because price gets overshadowed when I tell peope I am a Lawnsite Gold Member.....
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