Estimating and Bidding
Estimating is where profit is won or lost. Know the components of a bid: direct costs (labor, material, equipment), indirect costs (overhead), contingency, and profit. Understand quantity takeoff - measuring materials from plans - and how waste factors (commonly 5–10% for framing lumber, more for tile and roofing) are added to net quantities.
Master labor productivity concepts: labor hours per unit, crew size, and how productivity drops with weather, access, and overtime. Know the difference between a unit-price bid, a lump-sum bid, and a cost-plus bid, and when each is appropriate. Understand bid bonds (guarantee the bidder will honor the bid) versus performance and payment bonds (guarantee the work and the bills).
Learn contingency - an allowance for unknowns - and the danger of the "lowest bid wins" mentality when scope is unclear. Know how to handle addenda issued during bidding and the rule that bidders must acknowledge them. Understand alternates and allowances in a bid package.
Worked rule of thumb: If a crew of 4 carpenters at 8 hours/day installs 320 sq ft of wall framing per day, productivity is 320 ÷ (4 × 8) = 10 sq ft per labor hour. For 5,000 sq ft, that's 500 labor hours. At $45/hour burdened, labor cost = $22,500 before waste and contingency.
Traps: forgetting overhead and contingency; using net quantities with no waste; ignoring addenda; confusing bid bond with performance bond.