Bidding Out Your Project Correctly for Huge Savings

Bidding out your project is like shopping on Black Friday.  It’s important to…Know what you want…Never take the first price…Compare apples to apples.  That’s it.  You’re welcome.  But seriously, using good technique when bidding out your home activities to contractors can save you thousands of dollars.  Whether you are building a home from the ground up, or just replacing your roof, you can save some huge cash when you take a little extra time to do it right.

Know What You Want

How do you expect to get what you want at the price you want if you don’t know exactly what you want?  You know that guy that’s been camping out in front of Best Buy for a week now to be first in line for Black Friday?  Crazy right?  He may be nuts, but he certainly knows what he’s in line for.  For home building and repair, the bidding process should start with a detailed description of what you are trying to achieve.

So let’s say the roof needs to be replaced.  The person that doesn’t know what they are doing will start calling roofing companies and say something like, “I need to replace my roof, can you tell me how much it will cost?”  So, the roofing contractor will come out to the house and start making assumptions.  You know what they say about assumptions.  The contractor may assume you want 25 year asphalt shingles installed directly over the existing roof, and new roof vents.  So if you really wanted a 30 year architectural shingle installed after removing the old roof and keeping the existing roof vents, your price will be WAY OFF!  If you don’t know what should go into the detailed description, check out the Armchair Builder Scopes of Work and Specifications for important details on all building activities for homes.

Never Take the First Price

Let’s go back to the example of the guy camping out in front of Best Buy.  Do you think he knows what all the other stores are charging for that T.V. he has been waiting out in the cold for a week to purchase?  He can most likely tell you the price for the T.V. at all the other major retailers….down to the penny.  After all, if he just likes camping, I can think of some much prettier places to pitch a tent.  So no matter what type of work you are bidding out, be sure to get a minimum of three bids.  In this case, the more bids you get, the better off you will be.  With each bid you get back, you will learn something new.  I promise.

Compare Apples to Apples

Have you ever been burned by one of those scams that says, “Sign up for this and we will give you a brand new [insert your dream product here]”.  We all learned pretty quickly as kids or young adults to look hard at the fine print.  The truth is, the details can make a big difference in price in anything we buy.  This applies to T.V.’s, iPads, roof replacements, or new foundation installations.

So how do you go about comparing apples to apples when the item is somewhat unfamiliar to you?  Well, you better get educated fast.  Contractors can smell an uninformed person coming a mile away and some, will take full advantage of it.  One way to show that you know what you are doing is to request the bid in a certain format.  Create a spreadsheet that lists out how you want the price to be broken down.  This achieves several objectives.

1. You communicate to the contractor that you know what you are doing.  In other words you are saying, “Don’t try and screw me.”
2. You let them know that you are pricing out several companies.  This says, “Give me your best price or you won’t get the job.”
3. By having each company break down their price, you will be able to compare them directly.  Remember the last home project you priced out?  The price probably came back as a single number.  This doesn’t tell you anything about what is being done, how much is being done, what materials are being used, how many materials are to be used, how long the project will take, warranty period…etc.

Here at Armchair Builder we call these price spreadsheets Bid Sheets and they are a vital component in every project we build.  We have created them for all of the major building activities so you don’t have to.  Check them out in this video.  I can honestly say bid sheets have the potential to save you tens of thousands of dollars on your next major home building or renovation project.  So even if you don’t purchase the Armchair Builder versions, definitely take the time to create your own before bidding out your project.

Are you going shopping on Black Friday? 

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