The Publicists Assistant

What Estimating Construction Costs Can Show New Entrepreneurs

November 10th, 2008 | Author: Assistant

In all companies, wether you are selling information products or doing construction there are many lessons to be had. In this example we will have a look at the latter.

Your business has just opened its doors. A lot of money and time have been invested, in everything from advertising to office furnishings. The phone rings, and you answer professionally, though you are quite nervous. The conversation rushes by in an excited fog, and you gradually realize that the caller wants an estimate on painting her bedroom. “Two hundred dollars,” you blurt out of nowhere. Agreeing that the price is all-inclusive you seal the deal. As you hang up, you realize that you have just signed your very first customer.

So how could any of this be a bad thing? You named your price, it was tolerable to the customer, and a deal was made. Things couldn’t be any better, right? Before becoming too excited, consider what now takes place.

You arrive at the customer’s home, promptly on time. You make small talk, and are soon invited to see the room. Just before she opens the door, your customer more or less sngs, “I would have thought this would cost a lot more! Thanks a million for charging such reasonable prices.” You quickly get that sinking feeling as you get your first look at your new project.

The walls appear to be crumbling! You quickly conclude that the crumbling material is actually old paint. This will require a complete sanding job as well as patching and priming, before you can even begin to paint. To make matters even worse, the room is greater than your entire house, and you quickly establish that you are expected to paint not only the walls, but the ceiling and all of the trim as well. There are four double hung windows, each of which will need to be hand-sanded and repaired, as will the chair rail, baseboards, and four closet doors and casements. You quickly redo the math and immediately realize that the price you quoted will not even pay for the amount of paint needed, not to mention all the other tools and supplies that you will need in order to do the job. You taking your quote back, but quickly realize that new businesses are made or broken on the power of word of mouth, and to go back on an agreed-upon bid is suicide. You take the job in hopes of being able to write off your losses, and make a mental note do your home work next time around..

What went wrong in this situation, and is it possible to prevent this from happening to you? Fortunately, a myriad of software options exist. Software can teach you the ins and outs of cost estimating, and even let you know average rates for your location. You could also join a lead generation site. For a one time setup fee plus a small charge per accepted lead, these sites provide a wealth of tools, including cost estimation capabilities.

With the plethora of cost estimating software applications currently available, there is no need for even a brand new business owner to fall into the trap of poor estimating. Never quote a price over the phone, especially until you gain more experience. Even then, you may be able to ask key questions and throw out some very general figures, but you must continue to stress that you cannot give a firm price until you see the actual project.

For business owners there are many ways of keeping up to date and learning new things. One very popular learning tool right now are various instructional videos. A great place to find these is Ebook Maniac’s bookstore, particularly when if you are looking for various online business skills and strategies.