In my many trainings, I have learned there are certain warning signs that if not recognized can snowball and affect your company’s profit. Here is a list that I have put together based on my experience. They are by no means ranked in importance.

  1. Master Estimate has not been updated in a long time. Low escalation is around 3% a year. In 2021 we saw labor and equipment rates (including fuel) jump anywhere from 5-20% so if an estimating team is not updating cost, it doesn’t take long where there is no profit in the estimate. It tells me that someone in the estimating department is either lazy or doesn’t know what they are doing.
  2. Estimators have a pre-conceived idea of what a unit bid price should be. For example, if you look at their estimates you will see the same approximate bid unit price (for example $300/cy) for let’s say 4″ sidewalk across many years. The issue is with escalation when does this price increase? Similar to my first point. What I have estimators do is in order to achieve what they believe is a price the market will support they will manipulate costs (usually production) to achieve it. This practice will eventually bite you in the rear. And 2021 should certainly stop the practice with all the price increases.
  3. Estimators just guessing the number of shifts instead of actually going through the thought process of assigning a production type and production quantity. See my previous blog on the subject: BLOG
  4. Copying all the time from other estimates. A big red flag warning. The estimator cannot create an activity with production and material without copying; they need training! There is a growing number of HeavyBid estimators out there that say they know HeavyBid but take away the copy feature and they would freeze like a deer in the headlights. Now there are ways to speed up this process of copying but in the end it it much slower than having an Activity and Biditem Codebook. Get off this train.
  5. Send costs out of HeavyBid and finish up the bid in Excel. Doesn’t sound that bad but what I have found is it signals a major knowledge gap of what HeavyBid can do. Big warning sign.
  6. Doing something that no one else does in HeavyBid. Here is one example. I was at a company that each estimator FOR the SAME common estimate had their own estimate. In the end they sent all the costs out to Excel to combine them there. Creates all sorts of issues in terms of efficiency of quick changes, unplugging quotes that cross multiple estimator items and lots more. Again, this reveals that there are major gaps in knowledge of HeavyBid.
  7. Insistence that published databases (like RS Means) should govern costs in an estimate. I like published data, but it is only a reference tool not an end all. Any estimator worth their salt should have the basic knowledge of bidding a project without these tools and these databases are just a gut check. If the estimator doesn’t have the knowledge get out to the field!
  8. Treating Heavybid like it is a magic black box. I tell people I train all the time that it is 5th grade math. If you don’t understand the math don’t use it! HeavyBid in the end is made for the professional estimator and is a tool. I have people question why they are not winning jobs using HeavyBid and that tells me they are missing a major concept.
  9. Takeoff is still done by hand even with all the digital takeoff programs out there. Programs like Agteck have been around for well over 30 years. It is still king of dirt takeoff but there are other options out there as well.
  10. Last but still very important. Is the Estimating team being separated from the accounting effort of the company? If the estimating team doesn’t know if ongoing projects are on budget or not, how can they improve their estimates? I question companies that hide all accounting information from the estimating team. It just doesn’t make sense and is not a long term strategy for success.

See any of these at your company? They can be corrected.

I train and equip estimators to take estimating to the next level using HeavyBid. Contact me for your training needs. Just fill in the contact information on my blog site and I will give you a call.