Construction Management and Estimating

You got to know when to hold them, know when to fold them. It's kind of like on the spot bidding. Sometimes it works and sometimes it doesn't. We're going to talk about that today cuz on the spot bidding is a good tool for you to use to get your way. I just made that up on the fly. Damn. I'm like Eminem. I'm like an older, crustier version of Eminem. Take that, Marshall Mathers. I'm g take you with me out onto a job site where we do an on the spot bid. Now, I don't normally like to do that, but there's times when it's appropriate, when you don't want to waste any more time with the customer where you don't know where the customer's intentions lie. Sometimes you need to start, you need to quickly set a price and then adjust it up and down from there. Today I'm going to walk you through that process and take you out. We do a $65,000 on the spot bid with a customer and uh his jaw just about hits the floor. But what I needed to do with this is I needed to bring him back to reality. This guy was flipping clueless about his job. and he just kept adding on and adding on. And as we carried on the conversation further and further, he kept increasing the scope of work. And then he throws this out there where he says, "Oh, I just I just give me a ballpark figure." Well, you know, when you got a gigantic job, you give a ballpark figure, you're not going to get it. But you know what else? You're not going to want to keep wasting your time with some guy that's probably not going to be able to af Sorry, I need a better holder in my car. You're not going to want to waste your time with somebody that's probably not going to be able to afford the job in the first place. That's where on the spot bidding sets the price. Then you can read the customer's face. That's the thing. When you set that initial price, you need to look the customer in the eye. And if he's squirming and squeaming around, well, guess what? You're probably not going to get the job. You know he's not serious about it. And you don't have to go back to your office. you don't have to calculate all the other components in there because why? But sometimes you'll be surprised. Sometimes you'll give them an on the spot bid and they'll go, "Okay, let's proceed." Well, there you go. Now you got your starting point and then you can figure out the details from there. So on the spot bidding, it's not always I don't like to do it, but sometimes it's the right thing to do to save yourself some time. So let's take you through a job. Never seen the site we're about to go on. have been called out because they need a complete renovation. It looks to me you're going to see it for the first time just as I'm seeing it. This house has to come down behind me and then I'm actually not called out to do the house demolition on this job. The overall scope of work on it, which I'll try to get my foot in the door on it, is to knock this house down. Now, I can go through and calculate it. And I've taught you the numbers in other videos on how to calculate something like this. But after you do 50 to 100 of these things, you come out and you look at it and you go, I'm going to look at the front. I'm going to see how deep it is. Sometimes these houses are pretty deep and there's stuff behind them. This is an easy house. This is $12,500. Literally how long it takes to do it after you get doing it. That's the lick and stick method until you guys have years of experience and numbers of jobs underneath you. It's dangerous to do it that way. Okay? You really, if you're getting into this and it's your fifth one or your 10th one or your 15th one, you should really be calculating it all out like I've taught you in other videos. There's a formula for it that takes time and the formula ends up being the same as what I just said. So, um, let's look at this. We've also been called out to build the retaining walls. That's the portion of work they want us to do is the retaining walls. Now, I don't know what we've got going on here. Okay, we've got a giant hill that comes right to the back of this guy's house. Now, I've done this job before. I've done this job many times. In fact, I have a video called How to Turn a Hill into a Flat Backyard. And that is it lays it all out um in that on that job. So now what I'm doing right now is instead of recalculating everything and reme-measuring everything, I'm going on past experience. And this is where you guys as you grow in your business, you're going to be able to do the exact same thing on this site. Let me back up so you guys can get a view of it in comparison. Now, we're going to compare and contrast that video where it says how to turn a hill into a flat backyard. We had 600 cubic yards of soil we removed. It looked almost identical to this. And then we ended up installing I don't remember how many square feet but I think it was 75 tons which 75 times 7 somewhere. Let me think about this for a second. You know on that job how to turn a hill into a flat backyard. I can reme I can't remember how many square feet we installed but I can remember how many tons of boulders. In this case it was about 87 tons of boulders. Now, if I'm going to do the math bass backwards, 87 tons at we get seven square foot per ton using a 2 to threeft boulder. Uh, so that's going to give us right around 600 to 625 square ft. Depends on how, you know, how many square feet per boulder we're getting. So, on that job, we hauled out 600 cubic yards of material and installed 600 square feet of wall. That job was $34,000 for that project. So, I know that's going to be our base. I really I know that's where we're going to be our base where we're going to start from, but then I'm going to start designing backwards on this one to uh find out what they need, where the house is going to be positioned as well because this this one is coming down and then the new one's going in. Um, and so we've got to get that figured out. Now, the homeowner is looking at me like, why is there a person outside my window? I've never I didn't knock on the door. I didn't know anybody was home. So, good enough. I better go talk to him, huh? Okay. It doesn't relate to the So, homeowner Dan builder, Eric. And what we're looking at is uh 130 linear foot retaining wall, 7 foot tall, excavating out at least 600 cubic yards of soil. He asked me for a quick number, something that he could budgetwise, and we came up with 1,120 square feet, measured it out. Um, my quick number was $65,120 that was on the site. I have to go back to the office, calculate engineering. This is a double terrace retaining wall. A lot of a lot of other things go in place, but I've done this enough that I can give them that quick number. champagne taste beer budget. Um, and so that that struck as uh a bit of a surprise to him and way out of budget in this case, which is not a surprise to me. Um, and so then we looked at alternate options. He needs to get this done. And so what we've got to do is do it in stages. I do retaining walls in stages. You guys can do retaining walls in stages. So, in this case, we're going to dig this out. We're just going to do excavating this year. We're going to haul out all that dirt, and then we're going to platform the hill. So, this is a really big hill. This this hill is probably 18 ft tall right there. But then it drops down to about 14 ft right over in here. Okay. So, what we're going to do is we're going to take this 18t nub off. We're going to level this hill out. We're going to dig this bottom portion back. that's going to be about $10,000 worth of work. And then next year he wants to start building about $10,000 worth of retaining walls. And so we'll start in the back corner. We'll build $10,000 in retaining walls and we'll stop. And then the next year he wants to put another $10,000 in. And then we'll stitch it together. So there's a way when you do a modular block retaining wall that you can actually stitch them together and we'll just stitch them together and keep going. And so that's the plan that we're going to go with right now and see what what comes about. I'm going out coaching tonight, but I want to wrap this video up so you guys know where I left it. That on the spot bid that I gave that customer, that's all the more I'm going to pursue it. I could tell that this guy, his taste was way up here and his budget was way down here. And I'm not going to waste my time trying to make up the dis the the difference. Some people have to learn on their own. And I don't need to be their teacher. I'm your teacher. I'm your contractor. I'm the guy that's here to help you guys. So, if you're going to be wasting time on customers like that, you don't have the option now to go out and pursue other people that have more realistic expectations. You might the next person, their budget may be right here and their expectations are right here. And all you got to do is ek out a little bit of a difference. Those are the guys you want. But a lot of guys have such a gap in it that forget it. it's not worth your time. And that's what I'm doing. I'm forgetting this guy. He's got my my number. He's got my card. If he needs my help, I'll come in and then pursue it further. But even then, I'm not going to spend a lot of time with this guy until our expectations match up. So, on the spot bidding, it saved me going back here and typing on my computer and figuring out engineering costs and getting permit fees and all that other stuff because that takes time. that takes time away from other jobs. You don't have a lot of time. You're a contractor. Very rarely do those things pay off. Occasionally, they do. I will tell you, it's not always that this guy will flake out on you, but sometimes they'll come through and it works out. To me, it's not worth the gamble. Take it for what it is. You can use on on the spot bidding as a tool to determine where your customer's intentions lie. There you go. It works. I use it. I use it on this one and I use it for big jobs. I use it for little jobs. I'll use it for a $50 lawn. And I use it for a $50,000 landscaping job. It works when you know how to use it. I get to go watch a bunch of 12-year-old girls. My girls soccer team beat Rochester. Catch you later.