I recently had an opportunity to be invited into an estimating class via video conferencing so that I
could provide a demonstration of our TurboBid estimating software.
The company providing the class was Candels. They have a new state of the art training facility located in Southwest Florida.
The main reason that I’m writing this is to share just how impressed I was with the concepts that I saw being taught by Mr. Candels, and how they mirror the same concepts that we use in TurboBid.
While most estimate training classes will focus on the obvious aspects of estimating, it was refreshing to see Marc Candels taking the time to dig down deeper and help his students learn how to calculate their company’s operational costs, and then how to apply those costs to their estimates.
I was delighted to see that Marc had developed an Excel spreadsheet that basically matches the same context as the manpower burden calculator that we include in TurboBid. Both tools assist users in identifying and accounting for the additional cost, above and beyond the employee’s pay rate per hour, that their company incurs for each field employee that will be working on the job. The calculated annual burden cost is then divided by the employee’s annual billable hours. Annual billable hours are basically the number of hours that the employee will be on the job working each year. The result is an accurate manpower burden rate per hour that can be plugged into their estimates.
Mr. Candels also developed an Excel spreadsheet that follows the same concept as the overhead rate per hour calculator that is included in TurboBid. Both of these tools are designed to assist users in identifying and accounting for all of the costs that their company incurs simply because they’re in business. These costs have nothing to do with a project’s material, labor, etc. They include vehicle expenses, office supplies, office staff, utilities, etc. These overhead expenses must be paid each and every month regardless if their company is awarded 100 projects or, heaven forbid, they are not awarded a single project. The second step in the process is to calculate the company’s total annual billable hours. This basically represents how many hours all of their field employees will actually be working on projects over the course of the year. Once these values are determined, the annual overhead expense is divided by the annual billable hours. The result is the company’s overhead cost per hour. This overhead cost per hour is then plugged into their estimates.
When it comes to estimating, I constantly preach that a company must know all of their costs before they can decide what to sell a job for. Unfortunately, I’ve seen that far too many estimators don’t accurately account for their burden and overhead costs. This is why I was so pleased to see that Candels training classes dig deep into these subjects.
I am often asked where someone can receive estimate training. Candel’s will certainly be high on my list of recommendations.
For more information on Candel’s, please visit their website at https://www.candelsoncall.com.