So how accurate are quotes and estimates then?

[Roz]

1) I've managed to get 3 quotes in for getting our project to watertight. 2 have used an 'estimating programme' and one has gone to various suppliers and got costs for things. Any thoughts on difference between two?

2) Secondly, how does it work if a job takes longer than they've estimated? The estimating service suggests a certain number of days for certain things, what if it takes longer? Do I pay more? The guy who hasn't used the estimating service seems more of the mindset that he'll just do it for the quoted amount even if it takes longer. 

 

3) What happens if its not that they have estimated incorrectly but something else gets in the way like it rains? 

 

4) Lastly, should I feel comfortable to ask them to break the quote down as much as I want them to? I asked them to put in a spreadsheet so I can easily compare, but 2 of them didn't as they used the estimating service. I don't mind about one as I'm not interested in it, but the other is a good price it seems but I feel uneasy not having the breakdown I was looking for, which was into separate jobs and in materials and labour. He's broken it into sections, so foundations, slab, wall erect, above ground floors, roof erect, etc. Mine's a bit more detailed, probably double the sections, and in material and labour.

 

[ProDave]

There is a big difference between an estimate and a quote.  If you have quotes they should be a fixed price but will likely be full of clauses that allow extra charges if there is anything ANYTHING different to what the quote says.

[Roz]

Just now, ProDave said:

There is a big difference between an estimate and a quote.  If you have quotes they should be a fixed price but will likely be full of clauses that allow extra charges if there is anything ANYTHING different to what the quote says.

They're all quotes "we are pleased to submit the following quotation" etc. So the price should stand regardless of weather, suggested timing etc? If I wasn't to change anything.

[ProDave]

1 minute ago, Roz said:

They're all quotes "we are pleased to submit the following quotation" etc. So the price should stand regardless of weather, suggested timing etc? If I wasn't to change anything.

But  for example (as happened on my first build) when they started digging they found they needed to go deeper than expected.  There was a clause for an additional cost for each additional course of under building.

 

Want a window or door moved. Additional cost.  Usually comes in the form of a "notice of variaton"

[Dreadnaught]

Isn't there a difference in practice between a fixed price and a firm price? I seem to recall @JSHarris highlighting a difference.

Edited January 27, 2019 by Dreadnaught

[Jeremy Harris]

Just now, Dreadnaught said:

Isn't there a difference in practice between a fixed price and a firm price?

 

 

Yes. 

 

A fixed price isn't "fixed", if there are cost changes outside the contractors control then the price can change to reflect those changes.  The most common example is when exchange rates vary, changing the cost of imported materials.

 

A firm price contract is "fixed", in that the price cannot change without mutual agreement by both parties to the contract.  In most cases what people really mean when they say "fixed price" is firm price, and I bet that difference in contract definition has caught out a lot of people over the years.

[nod]

I’m quoting for large jobs 15 months in advance 

As Dave pointed out there is a big difference between a quote and a estimate 

Most of my materials come via Gysum So I know when there is a price increase and how much and factor it in 

 

You are right to request a breakdown of any quote I’m not a big fan of the online estimators 

But perhaps I’m set in my ways 

With all the Brexit uncertainty it is difficult to product material rises 

But any quote should be firm Shen it comes to labour 

I would sit down with the third chap 

Seperate his laboure cost and ask him to breakdown his material quote including his 10% supply charge and agree to stand material price increases 

Then everyone knows exactly where they stand 

 

Also it is worth getting everything down on paper 

There will be some extras It’s difficult to estimate how deep foundation will go Propblems with drains etc 

 

There nothing worse than feeling like your being cheated for you or your builder 

 

[Roz]

2 minutes ago, nod said:

I’m quoting for large jobs 15 months in advance 

As Dave pointed out there is a big difference between a quote and a estimate 

Most of my materials come via Gysum So I know when there is a price increase and how much and factor it in 

 

You are right to request a breakdown of any quote I’m not a big fan of the online estimators 

But perhaps I’m set in my ways 

With all the Brexit uncertainty it is difficult to product material rises 

But any quote should be firm Shen it comes to labour 

I would sit down with the third chap 

Seperate his laboure cost and ask him to breakdown his material quote including his 10% supply charge and agree to stand material price increases 

Then everyone knows exactly where they stand 

 

Also it is worth getting everything down on paper 

There will be some extras It’s difficult to estimate how deep foundation will go Propblems with drains etc 

 

There nothing worse than feeling like your being cheated for you or your builder 

 

My 'best price' has come from one of the guys using the estimating service. This guy didn't break down the costs as I had asked so would be the one I would need to persuade to break them down ( I already asked him to do it, and he said he would, but then he just sent me a half break down). 

 

My 'best feeling' is coming from the one that didn't use an estimator and went to his merchants and asked for prices. He's always replied to my messages straight away and happy to answer questions as I need them. However, he costs more. However... I would feel more confident that he wouldn't hike is prices. 

 

The first one thinks the job will take 6 weeks, the second thinks 12 weeks.

 

If I go with the latter I think I'm going to want to ask him to do it labour only, as he's not VAT registered. He's broken his costs down for me as I originally asked, so I know how much it should be in theory. But i don't want to piss him off...

[recoveringbuilder]

He may be quite happy to do labour only, saves him having to put out any money on materials before you have given him any cash, it would also be better for you as you can shop around for best prices and get the vat back, we did this with our builder, we made a list of materials we would need and sent it to 5 different builders merchants asking for best price however one of the merchants who had been one of the most expensive sent in their rep who we told their quote had been too expensive and he slashed the prices and they ended up being the cheapest and getting all our business.

[the_r_sole]

.

Edited September 26, 2019 by the_r_sole

[newhome]

I deal with fixed price contracts a lot at work and they are far from fixed if anything changes that's not explicitly catered for in the contract. If you have a more detailed breakdown why don't you provide that and ask if all of the things on your list are included. And then you need to validate all of the assumptions that have been made - both yours and theirs. So your assumption might be that weather conditions will not impact the cost and ask them to validate that, and so on. We came a bit unstuck with one of the jobs we had expected to come under the fixed price for the timber frame kit and that was fixing the sarking to the roof which is standard practice in Scotland. It came as part of the timber frame kit so we had expected it to come under that quote. The guys putting up the TF said no it came under roofing (the TF team was doing the trusses) but the roofers said no it didn't so we ended up paying the TF team extra for that. That's just an example of something that due to our naivety ended up costing us more. 

 

One of the biggest causes of a change to a fixed price contract where I work is when something happens that is outside their control. So when someone else fails to deliver on time or to the quality needed for example. That's when we generally hit change request territory fairly rapidly but if your guys deal with it all then you should be covered to a degree. If however you are ordering the materials and something doesn't turn up on time they can argue that you caused a delay so do be careful to manage supplies carefully if you go down that route. If one of the guys isn't VAT registered you will want to order the materials yourself however in order to reclaim the VAT but it needs careful management. 

 

I think the moral of the story is to expect that jobs will take longer and cost more, and to expect the unexpected despite how much due diligence you think you've done. 

[epsilonGreedy]

Assume it will end in tears so focus on termination clauses, staged payments and what will be delivered at those stages.

[Ferdinand]

If it is just a ‘quote’, then I would say half or double ... obvs it is logarithmic.

 

And the way to manage it is by taking out the risk for them, as well usual cost disciplines.

 

If you eg make them responsible for variable elements, then the price will include that risk that is difficult to strip out.

 

Very important to have a frozen design, to minimise changes, and to have taken more than adequate time up front.

 

Ferdinand

 

[Declan52]

Just remember that no matter what price your given shit will happen during every single build and end up costing more than you expect.  So factor in your contingency to cover yourself.  

And as above go over every single aspect before you start to make sure you haven't left anything out or the builder hasn't put everything in the quote.  Same goes with changes,  doesn't cost much to do it with a pencil but will later on.