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Steel estimators identify all the steel items to be fabricated from the set of bid or contract documents. They list and price these items. They then provide a bid price to the potential customer, prior to their required bid date and time, in the format requested.
Learning to become a steel estimator takes time, practice, and repetition. It is a profession that is learned by doing. There is no set format for doing the job—only unwritten practices that have been handed down by predecessors to eager apprentices. Each estimator’s skill is developed over time and trial. What works or does not work to gain success is learned quickly.
All the information needed to prepare a steel estimate with regard to takeoff and pricing is indicated in the bid and contract documents. A complete price must include all the labor hours to fabricate the work; all costs for steel detailing, steel materials, fasteners, buyouts, forming, and specialty items; all paint and related labor; shipping; and last; all markup and profit extensions.
It is the steel estimator’s goal to include everything needed for the completed scope of the work and still be the low bidder against the competition. Although this task sounds impossible, it is not because all the other steel estimators bidding on the projects have the same set of information. The utilization and interpretation of that bid set information, together with the knowledge and experience of the steel estimator, are the trick to being successful.
It is highly unlikely that any two projects in the commercial marketplace will ever be the same. Because all jobs are different, it stands to reason that the methods for steel estimating vary from project to project. Nevertheless, the basics applications, as defined in this manual, remain consistent.
Consistency in the work structure helps to avoid confusion, both for steel estimators and for others who need to use the information created within the steel estimate. Developing a consistent format for the take off and estimating practices will enable others to quickly understand the information provided. Because the specifics of the steel fabrication company’s requirements will vary, the estimating format needs to be shaped individually.
The basic information contained in this book will get you started and move you along in the right direction. Your work activity will help you learn more. Each project may reveal something new and different in the plans and specifications. Be flexible in dealing with project inconsistencies. Learn to work with potential customers in order to resolve any problems that may arise from those issues.
Steel Estimating is a little like gambling—you throw down your dollar and place your bet. You never really know how other people arrive at their bid numbers. What is truly important is that you know how you arrived at your price. Don’t spend a whole lot of time trying to figure out how your competition arrived at theirs—the unknowns will leave you with many unanswered questions. In the end, the project sells for what the market will bear. Stay on top of what the current market values are by obtaining post bid information whenever possible. Having this information will help you know where your finished pricing has to be in order to create a successful quote.
Mentoring with someone who has a successful background and years of steel estimating experience is a great way to get started. Build a strong foundation for yourself by working with those who are successfully established in the industry, and stick with the winners.
The ability to read the contract drawings and the shop fabrication drawings is essential to steel estimators. Acquiring a working knowledge of these drawings is important. By understanding contract drawings—what the steel fabricated items look like and how they are used—you will know exactly what to look for and where.
After they are familiar with the drawings, steel estimators must then learn to list the steel materials, also referred to as “performing a take off.” Listing the materials from the contract drawings becomes easy once you know what you want to find. After the take off is complete, the pricing is installed and the shop labor is applied. All the rest is just math steps—with the extensions of weights, pricing, and markups—to arrive at the proposed sale amount.
It is essential that steel professionals know everything there is to know about the steel items being quoted. They must know the plan for detailing the steel; purchasing the materials, goods, and services; and the required time to schedule for the shop, as well as the anticipated final shipping date for the steel. As the steel estimator, you must create a good map to the project by way of your take off, using adequate and current pricing and labor hours; you should demonstrate the expediency and efficiency toward which the project managers and shop managers will need to perform.
Create a complete plan with everything itemized and listed, including contract drawing details and drawing references. Those who refer to the plan should be able to see the necessary steps for fabrication, using the guides provided for them to follow. This plan created by the steel estimators will be referenced during the entire course of the project. From bid day through to the final billing, all the information you put in your quote will be very valuable.
All information provided by steel estimators must be clear and concise. Any items that are not clear and concise will be the ones that will come into question later—guaranteed! When questions come up during the fabrication process, the steel estimate will always be referenced for answers as to what was bid.
Every job has situations that are unclear. Therefore, even the ambiguous items must be well documented along with what was priced to cover that work. The materials list together with the bid letter precisely documenting all of the information goes a long way towards a successful project.
Many shops assign their estimating department to their sales department. In many cases, the estimators double as the ones who will also choose the projects to quote. The estimator as salesperson is common practice with smaller fabrication shops; estimators have the working knowledge of the project they quoted or will be quoting, enabling them to work more efficiently with the customer.
Initially, choosing a job sounds like a simple task. One would think that if a project requires fabricated steel, well, you would then quote on providing that steel. However, when the bid documents are analyzed based on the items to be fabricated, the process of choosing or not choosing a particular job to quote becomes a bit more involved.
Selecting projects to quote for the shop is a responsibility that involves a realistic view of a combination of items. Use Table 1.1, The Elements of Project Evaluation, to help with your choices. Know where you are with these items listed before you choose to bid on a job.
Consider these items carefully. It is important to understand both your own estimating capacity and your work backlog. Don’t overload yourself and create a quote in a rush if you can avoid it. Overselling the shop has negative implications to project schedules and cash flow requirements.
Steel estimators must understand the types of projects that are a successful fit for the company. If the company is interested in expanding or diversifying, then looking for small projects with fabrications that are different than what the shop normally performs might be prudent.
Table 1.1 The Elements of Project Evaluation
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