pricing very large jobs?

Discussion in 'Landscape Architecture and Design' started by italianstallion69, May 13, 2013.

  1. italianstallion69

    italianstallion69 LawnSite Member
    Posts: 108

    i do 25-88g jobs all day long.

    nothing different on a 890g job just 10x the payroll, supplies,

    everything is math. production time planting a tree with just an excavator vs excavator + skid steer etc.

    the project will be done in stages, i will find out about it this month.

    I assure you i can execute any project from 25g up.

    numbers. projections. actual cost. variance. evaluate, adjust.

    just to prove your point wrong, my first job was 10k and I never looked back. i bill 6 figures in august.
  2. 94gt331

    94gt331 LawnSite Bronze Member
    Posts: 1,695

    Good post! I do alot of small jobs. My highest job ever was $15,000 haha peanuts compared to you. But we stay really busy knocking out 500- 2,000 jobs reguarly. Good luck to you man. Your on a different level than I am and certainly need to have alot of confidence in your company. I honestly like to play it to safe all the time. I turn down any job that gets to complicated and risky. But to each his own, good luck send us some pics if you get it. :waving:
  3. AintNoFun

    AintNoFun LawnSite Bronze Member
    Posts: 1,807

    whats your plan if the GC stiffs you? can you absorb the hit or go outta business?
  4. IES

    IES LawnSite Senior Member
    Posts: 296

    I've been there and ain't any fun. After that I've changed the way I run any size job. And the way I look at any large job as well.
  5. JimLewis

    JimLewis LawnSite Fanatic
    Posts: 6,841

    Honestly, he has a better chance of putting himself out of business - just by not knowing his production times well enough and not considering all of the possible expenses. You take on a $400,000 job -- only to find out near the end that you should have bid $500,000 like everyone else -- that will put you out of business faster than anything.
  6. SRT8

    SRT8 LawnSite Bronze Member
    from CA
    Posts: 1,294

    Yea, when bidding any job you have to know every single number.
    If its a $500k job and you bid $400k just to land wont be around very long. We recently turned down a job for $1.3mil , we were at $1.6 and they wanted us to drop our price and match what the other company was charging.............wasn't going to happen. $300k is a lot of money.
    When doing commercial you can lose a lot of money really fast, that's the bad part about it. You are forced to work around so many contractors, some times its ok and sometimes they are all ******ed.
  7. alexschultz1

    alexschultz1 LawnSite Bronze Member
    Posts: 1,555

    Ok, let's say he bids the job for $300k and it ends up being 400k. What do you do? I'm with 94gt331, my most expensive job was $35k so this is very foreign to me.
  8. JimLewis

    JimLewis LawnSite Fanatic
    Posts: 6,841

    You end up completing the job but instead of making the $55 per man hour you were hoping to make, you make $35 per man hour. The materials are a fixed price. So that cannot give. The only thing that gives is the amount of money you make after materials (labor, profit).

    In that case, in reality, you'd end up paying your workers; paying for a lot of the materials; still owing suppliers for some of the materials; making no profit on the job; some big tax bills, insurance bills, and worker's comp. bills that you wouldn't be able to pay. Then you'd be scrambling to land another job to help you recover your loss on that previous job. As you started getting funds in from the new job, you'd start paying off your late bills that were stacking up. Hopefully, you'd learn your lesson and start learning how to bid jobs correctly. But often times if you cannot get back on track quickly enough, it just ends up putting you out of business, because you're not really accounting for your full overhead and can't pay the bills.

    That's probably the most typical scenario.

    Another scenario is you run out of funds and cannot complete the job. The client goes against your surety bond and the bond company covers the cost to have another contractor come in and complete the job (read more here). Then your bonding company retracts your bond, black lists you, and you cannot get a bond anymore. At least not without paying exorbitant rates. So without a bond you lose the ability to bid jobs like this again and go out of business.
    Last edited: Aug 4, 2013
  9. AintNoFun

    AintNoFun LawnSite Bronze Member
    Posts: 1,807

    your forgetting another scenario (imo the most likely), he doesn't have the funds to finish and walks away. the gc hires someone else to finish the job and backcharges him the difference. gc sues him for the difference now he can owe another few hundred thousand on the job thus putting him outta biz..
  10. JimLewis

    JimLewis LawnSite Fanatic
    Posts: 6,841

    Not very likely. Any G.C. doing a job this size is going to require a surety bond. You wouldn't hire someone for a job that big without that contractor being bonded. Hence my second scenario above.

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