Business tip #4 Profitable Estimating from Strategic Landscaper

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Business Tip #4

Business Tip #4- Profitable Estimating

Profitable Estimating

StrategicLandscaper.Com

Presented by: Matt Hudson

Part 4- Profitable Estimating

Purpose: An Overview of Different Estimating

Systems and How To Take Control of Your Business

Business Tip #4- Profitable Estimating StrategicLandscaper.Com

Take Time To Educate Yourself on Different Estimating Methods

Don’t Assume!

Ask Yourself:

“What Estimating Method Am I

Using Now, Where Did I Learn It &

How Do I Know It Works?”Business Tip #4- Profitable Estimating StrategicLandscaper.Com

Foundation: You Must Know Your Numbers

Annual BudgetCompany P&L

Project / Account P&LEstimating

Run Your Business From Your

Estimating Sheet

There Are Many Estimating

Systems:

Systems:• Factoring- Materials Multiplied

• (SORS) Single Overhead Recovery System

• (SORS) Single Overhead Recovery System• (MDUP) Market-Driven Unit Pricing

• (DORS) Dual Overhead Recovery SystemBusiness Tip #4- Profitable Estimating StrategicLandscaper.Com

• (DORS) Dual Overhead Recovery System• (MORS) Multiple Overhead Recovery SystemBusiness Tip #4- Profitable Estimating StrategicLandscaper.Com

• (DORS) Dual Overhead Recovery System• (MORS) Multiple Overhead Recovery System• (OPPH) Overhead & Profit Per Hour

Your Estimating Process Should Tell You Three Things:

1. Breakeven Point

1. Breakeven Point2. Net Profit

1. Breakeven Point2. Net Profit3. Process & Schedule

First Step:

Create Your Annual Budget

First Step:

Create Your Annual Budget• Identify Costs For The Year; Historical &

Estimated

First Step:

Estimated• Use When Recovering Labor & Overhead

First Step:

Estimated• Use When Recovering Labor & Overhead• Used To Determine Your Profit Margin

First Step:

Estimated• Use When Recovering Labor & Overhead• Used To Determine Your Profit Margin

Second Step:

Identify Which Estimating System

You Are Going To Use & WHY

Second Step:Identify Which Estimating System

You Are Going To Use & WHY

(OPPH) Overhead & Profit Per Hour

Third Step:

Identify Project Breakeven Point

Breakeven Point=

Breakeven Point=• Total Direct Costs:

Breakeven Point=• Total Direct Costs: • Materials (w/tax)

Breakeven Point=• Total Direct Costs: • Materials (w/tax)• Labor (w/labor burden)

Breakeven Point=• Total Direct Costs: • Materials (w/tax)• Labor (w/labor burden)• Equipment

Breakeven Point=• Total Direct Costs: • Materials (w/tax)• Labor (w/labor burden)• Equipment• Subcontractors

• General & Administrative Overhead CostsBusiness Tip #4- Profitable Estimating StrategicLandscaper.Com

Fourth Step:

Add Your Profit Margin on Top

Fifth Step:

Convert the Estimate Into

A Process & Plan

Sixth Step:

Implement Job

Track All Data

Analyze Estimated vs. ActualBusiness Tip #4- Profitable Estimating StrategicLandscaper.Com

Seventh Step:

Adjust Accordingly

Estimating Takeaways:

Estimating Takeaways: • Profitable estimating is vital

Estimating Takeaways: • Profitable estimating is vital• Puts you in control of your

business

business• Makes you more competitive

business• Makes you more competitive• Imperative for long term success

Action Steps: Part 4- Profitable Estimating

Action Steps: 1. Get Clear

Action Steps: 1. Get Clear2. Identify An Estimating System

Action Steps: 1. Get Clear2. Identify An Estimating System3. Implement It

Action Steps: 1. Get Clear2. Identify An Estimating System3. Implement It4. Test It

Action Steps: 1. Get Clear2. Identify An Estimating System3. Implement It4. Test It5. Grow

Be On The Lookout For:

Part 5- Developing A Sales

System

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