So Wouldn’t You Like a Plan for Doing Construction Proposals
It’s Saturday, and today will be Gene’s third meeting with John. Even though there’s been no change in Gene’s overwhelming workload, today is the first time he’s not considered canceling. He knows the value of this information and is looking forward to the opportunity to learn more from his mentor.
It’s Gene’s turn to provide lunch and John’s in for a treat…Gene’s bringing chili-cheeseburgers and fries from the Burger Station. Driving to John’s office, the smell of those burgers is more than Gene can bear, so he samples a few fries on the way, just to be sure they’re okay.
Gene had barely gotten in the office door before John yelled out from the conference room, “You brought Burger Station!”. Over the years when Gene was working for John, the two of them frequented this fine establishment often.
As Gene gets lunch out, John says, “We have a lot to cover today, so we better get started. As we go through this today, think about building a proposal as compared to building a construction project. Now let’s review…
First, we started with WHY…
Why do you do what you do? Why should you do proposals? Both these questions are similar to the question we should ask customers when they’re considering a construction project. Why do you want to do this project?
Second, we discussed that communication is the contractor’s responsibility.
We are the professionals in this arrangement. We shouldn’t expect the customer to know everything about construction. This is why they are looking to hire someone to do their project. It’s up to us as contractors to communicate clearly.
Third, we discussed bid mistakes.
These mistakes are commonly made and are costly. Being aware of them ahead of time helps you know what to avoid and increases the opportunity for happy customers. Not to mention it gives you a big advantage over your competition.
In our meeting two weeks ago I gave you the proposal overview to take and review. Today we’ll go through it and break it down. I know it seems like we’ll never get to actually doing a proposal, but think about it like a construction project…
The designing and planning take as long as the construction.
Let’s start by looking at the documents included in the system and a brief description of each.”
Bid sheet – A Word document with the various construction categories and individual tasks listed with space for filling in the scope of the work to be done, dimensions, materials, locations, etc., for each category as needed for clear communication.
Worksheet – An Excel spreadsheet with all the construction categories and individual tasks listed with overhead and profit markup formulas.
Proposal – A Word document with space to fill in pertinent information, i.e. customer’s information, what will or will not be supplied by the contractor, the scope of work, the proposed price for each specific element, a total project price, payment arrangements, and project duration.
Data Base – An Excel spreadsheet with prices for material and labor for a wide variety of specific construction tasks. This information will be used in the worksheet template.
After reviewing and discussing these documents and definitions, they looked at the process of doing a proposal.
STEP 1 – Gathering Information
Gathering the right information correctly and effectively is critical to preparing an accurate and thorough proposal. Once you’ve been contacted by a potential customer, start by scheduling a meeting to discuss their project and find out what they hope to accomplish. At this initial meeting gather –
Measurements and dimensions, existing and new
Building materials, existing and new
Pictures of pertinent areas and existing construction
Customer’s design ideas and finishes
The information gathered at this meeting can be recorded in whatever way works best for you. The important thing in this step is to gather any and all information needed to prepare an accurate proposal. It can be handwritten on a printed out Bid Sheet template, or it can be entered directly to a Bid Sheet on a tablet, smart phone, or laptop. Using the Bid Sheet minimizes overlooking things because the different areas of a construction project are already listed.
STEP 2 – Preparing the Scope of Work
After the preliminary information has been gathered it’s time to clarify the scope of the project by writing out the description of each specific task in terminology that both the customer and the contractor understand. It needs to include enough specifics to be thorough without being too technical. It doesn’t help communication if the terminology is confusing to the customer. This written description on the Bid Sheet will be transferred to the Proposal and serve as a written scope of work to be performed and materials to be provided.
STEP 3 – Pricing the Project
Next is putting prices to the project. This process involves two different Excel spreadsheets, the Worksheet and Data Base. Based on the descriptions written on the Bid Sheet, content from the Data Base will be copied and pasted into the correlating cells on the Worksheet. After the pertinent information from the Data Base has been placed on the Worksheet, it’s time to fill in the quantities.
STEP 4 - Quantities
On the Worksheet you will fill in the quantity needed to do the work on that line item. This may be lineal feet, square feet, square yards, cubic feet, cubic yards, numbers of pieces, etc. Once this is completed you will now have prices for each of the different tasks listed on the Proposal.
STEP 5 – Preparing the Proposal
Now you have everything you need to complete the Proposal. You will take the descriptions from the Bid Sheet and the prices from the Worksheet and put them both on the Proposal. After filling out the customer’s information at the top of the page, the scope of work, the price for each task, the total project price, how payments are to be made, and the duration of time to do the project, the Proposal is ready to be presented to the customer.
As they wrapped up the meeting, John looked at Gene and asked him what he thought so far. Gene said, “I had no idea there was this much to doing proposals.”
John said, “I know. That’s why most contractors either guess at their bids or just give estimates…and we’ve all seen how that well that works out.
Next week we’ll dig deeper into GATHERING INFORMATION.
If you’d like more information about the proposal system referred to in this blog post, you can check it out here. You can learn more about some of the other tools for building a successful construction business here. If you have any questions, schedule a free 30-minute construction company consultation.
Previous posts in this series:
What is “business clarity” and how do you find it? (12/24/23)
What Does it Take to Build a Successful Construction Company (12/31/23)
It’s Time for the First Meeting (1/14/24)
Being Aware of Bid Mistakes is the Best Way to Avoid Them (1/21/24)