This sendout will focus on how businesses are changing their tendering tactics. It follows on from a newsletter we sent out two weeks ago with data taken from a survey we conducted (you can read it here.)

What we’re seeing

Section 1: Likelihood of tendering projects outside preferred contract value range:

Commentary:

• More than two thirds of our respondents anticipate they will be tendering significantly outside their preferred range in the coming twelve months. 
• The higher the preferred contract value range, the more likely the respondent is to anticipate tendering outside of that range. 
• Builders are signalling an intent to follow the work: while it isn’t financially desirable for larger builders bid on projects with smaller contract values, it’s a sign that there are less projects available in their target contract range.

Commentary:

• Businesses who predict market conditions will deteriorate are the most likely to predict they’ll be tendering on jobs significantly outside their contract range. 
• These respondents appear to be flagging pro-active changes in the way their business operates. They are signalling a need to be flexible in the face of worsening industry conditions – seeking an extra leg to stand on in a competitive market.

Section 2: Competitive tender panels:

Commentary:

• Like our data suggested in a previous newsletter (link), over three quarters of respondents feel that market competitiveness is increasing.
• Builders who prefer to work with $1 – $10m and $50 – $100m contracts are most likely to note an increase in competition. 
• Below we show a graph showing how builders are increasing the number of projects they are tendering per month. It is likely that the increase of competitiveness in these value ranges is a result of builders upping their tender load in areas where the work currently is.

Commentary:

• This chart shows the change in the number of tenders per month by a given builder, comparing 2020 to 2019. It includes only those builders who tendered in both years (so doesn’t reflect the effect of new entrants or business closures).
• Builders in the majority of states have increased the amount of tenders they bid on per month. With the total number of projects tendered on EstimateOne returning to more normal levels, the increased competitiveness appears to be driven by the market.

What we’re hearing:

Businesses are starting to feel the pinch of competitive tender panels.

• A builder who tenders on contracts under $1m told us that he’s seen an increase in competition on government and residential tender panels. He also told us about an education job he recently tendered on where 30 builders showed up at the site inspection and 20 ended up on the tender panel. 
• A survey respondent from Queensland also lamented the more competitive tender panels. They noted that some project panels were now in excess of 10 builders and predicted that the market will remain depressed for the foreseeable future. 
• Several builders have told us that selective tender panels have increased from an average of 3-4 builders to 6-7.

More subbie prices are coming in as the fear of underpricing grows.

• One estimator from Queensland told us that he’s seen an increase in subbie quotes coming in – which for him is the canary in the coal mine for market competitiveness. 
• Someone had also noted that residential builders are starting to pop up on comercial tender panels. On these jobs they bring their own residential subbies, who are able to quote the work for less.
• “The cost of building hasn’t decreased,” one survey respondent told us. In order to meet the price of the market and get on site, people are quoting much less. The respondent stipulated that the effects of under-pricing will come back to bite the industry in the next six months. 
• One builder we spoke to also mentioned that he believes some clients are using the current market conditions to their advantage. He believes clients are looking to lock in lower prices now with no intention to proceed with the build in the near future.

Businesses are becoming much more flexible in order to adapt to the change. 

• As a result of increased competitiveness, builders are starting to expand into different sectors in order to lock in any work.
• A builder from New South Wales told us that they’re “seeking any opportunity in any value range to keep people employed”.
• Builders have also let us know how they are diversifying the project sectors they are bidding on. Some builders who would only bid on private tenders have noted they are now bidding on public ones as well. 
• Having to work from home is also a reality many builders faced. Some have noted how going forward this will be offered to staff permanently. Adopting new technologies such as zoom was important to ensure collaboration remained in place.

The post COVID-19 Industry impact newsletter – June 17 appeared first on EstimateOne.

The respondents were not only generous with their time, but also with the level of detail they were willing to go into with their insights. It’s a real joy to see how our industry is banding together to help eachother out in these times. 

We’ll share the results over  two newsletters, with this sendout focussing on industry confidence and the government’s plan to use construction as a lever to stimulate the economy. 

What we’re seeing

Section 1: Industry Confidence
Question: Over the next 12 months, for your business do you think things will…

As we saw in our analysis of COVID-19 impacts by state and sector, fortunes in the industry are mixed with some bearing the brunt more than others. Confidence is split, though a greater share still expect improvement in conditions compared to those who foresee a deterioration.

We’ve asked this question before as part of our annual industry survey. Here is how it looks when compared to the same question being asked in 2018 and 2019.

Commentary:

• A ten fold increase in people thinking that business conditions will deteriorate in the next 12 months re-enforces the anecdotal evidence we’re hearing; the initial panic has subsided, but much of the industry feels the toughest times are yet to come.

Commentary:

• Industry confidence is down particularly in Queensland. The increase in competition on Queensland panels we showed in our last newsletter  could be a contributing factor to this result.

Section 2: Government stimulus: 

Question: Is your organisation well placed to benefit from government stimulus in the construction industry?

Question: What impact do you think the government stimulus for construction will have on your organisation over the next 12 months?

Commentary:

• A third of those who responded to the survey believe that the stimulus will not effect / have a negative effect on their business. 
• Expectations around business confidence were linked to builders’ views on the stimulus; 55% of responders who said at the start of the survey they expect business conditions to deteriorate, believe that the stimulus will have no effect / a negative effect on business.

Commentary:

• Responders in states like NSW (link) and VIC (link) who have started announcing details around planned stimulus policy have the highest confidence that their business will benefit from the packages.

Below is a split of what impact businesses think the stimulus packages will have based by the value of contracts they typically work on.

Commentary:

• We can see that builders who typically work on larger contracts are more confident that they will benefit from the stimulus. 
• Conversely, builders who work on smaller contracts are more likely to say that the stimulus will have a negative effect on their business.

What we’re hearing:

As the above data suggests, the government’s plan to use construction as a lever to stimulate the economy has been met with mixed opinions. We gave our responders the option of writing down why they answered the question in a particular way – this has given us the chance to provide deeper insight into the way the industry is feeling. 

Many feel the stimulus is geared towards tier one or two builders:

• Many of our respondents wrote to us fearing the lion’s share of the stimulus packages will go to the larger builders. 
  • One responder claimed that “a lot of projects are in large bundles for the multi-national builders”
  • Another responded “The stimulus package will most likely only help the Tier 1 and larger contractors, not the mid tier”
• One responder was hopeful that this stimulus would trickle down to the tier 3 and 4 builders, but expected that to be at least 12 to 18 months away. 
• These sentiments could be based on experience, as this is somewhat like what we saw with the Building the Education Revolution (BER) stimulus in the wake of the GFC.
  • $16 billion worth of stimulus work was released quickly to the market. The lion’s share of the school packages were awarded to the nation’s largest builders, due in part to the government’s desire to deliver the stimulus to the market quickly via packages of a hundred schools at once. 
  • In some instances, this resulted in unnecessary levels of additional project management and wastage of funds. 

Some feel that the construction stimulus won’t be in the fields they typically operate in.

• One person noted that policy amendments such as the first home buyers scheme will benefit project builders but not those who work on more bespoke / commercial works.
• One noted that they believe the majority of the funds would head to regional areas where their business doesn’t have the subbie contacts required to put in a competitive quote.
• A concern was also shared that these packages will attract their regular subbies to infrastructure works, leaving them at risk in their current tenders / and future awarded tenders

Some worry the stimulus could exacerbate the problem of under-pricing:

• One responder told us: “You still need to win the work, potentially of all the contractors that can complete those projects, there will be a few that will do it for nothing, making it difficult for the majority to win the work.”
• Another responder stipulated that all the stimulus work will have a lot of businesses flocking to it – thus increasing the competitiveness in price required to win it.

Those who are ready / willing to adapt are confident in what the future has to bring. 

• A lot of responders wrote that they are confident their business will benefit, as they have gone through all the necessary procedures to complete government work in the past. 
• One person wrote “We are restructuring our company to be able to undertake more government work.”
• Quite a few responders also were confident as they had won a lot of education jobs in the past. With education likely to be the lynchpin of many policy announcements, these builders are confident they’ll be able to take advantage of the upcoming packages. 

The post COVID-19 Industry Impact Newsletter – 3rd of June 2020 appeared first on EstimateOne.

However on both fronts there is cause for caution. Just as health authorities prepare for a second spike in cases, our clients are telling us they’re preparing for an industry dip down the road., 

In this newsletter we take a look at competitiveness, and unpack how the lower volume of tenders since COVID-19 might be causing an increase in competition on the tenders that are now closing.

What we’re seeing
Section 1: Aggregate new tender volumes:

Commentary:

• Week 0 represents the first Federal Government response to the pandemic, so you have to look to week 3 for when the strictest lockdown policies began. 
• Last week we saw the most tenders added to the noticeboard since the lockdown restrictions began.
• Tenders in the Government, Commercial and Education industries continue to be the strongest performers throughout the pandemic.

Section 2: Tender competitiveness:

While we are starting to see an uptick in tenders in the last couple of weeks – we are also now starting to get a picture of how the dip in tenders affected the market. 

Throughout this time we saw an increase in the number of builders on each tender panel. We attribute this to a potential combination of a couple of things;

• There are less tenders on the market to quote on, and,
• Builders are looking to sure up their work pipeline ahead of an uncertain future.

Commentary:

• Here we are seeing a clear uptick in builders per tender for tenders that closed/are closing in April and May. 
• By industry, we are seeing an increase in competitiveness is most noticeable in Commercial, Education and Fitout tenders. 

Commentary:

• By showing a year on year comparison, we can see that a decrease in tenders being added to the noticeboard has led to a more competitive than average May. 

5+ builders per tender:

Commentary:

• Traditionally, we’d see spikes in projects with 5+ builders towards the end of the year.
• However, currently we are seeing a big spike which defies usual April/May activity. 
• Anecdotally we have been told of a school project being tendered  in Queensland that has in excess of 20 builders on the tenders panel.

What we’re hearing:

Tough times ahead for tier ones:

• We’re hearing that the pipeline of future works suitable for tier one builders is starting to dry up. These pipelines were slowing prior to COVID-19 and the uncertain economic outlook is only making it harder to get these projects off the ground.
• Action taken by the government to fast track certain projects hasn’t been as helpful as hoped. Even with hastened approvals, the inability to secure sales/tenancy commitments is making it challenging to obtain finance
• We’ve also heard that some large corporates will be looking to make working from home arrangements permanent for a couple of days per week. If adopted at scale, this practice could reduce demand for larger commercial buildings

Subcontractors pencils are getting sharper:

• One client has told us they’ve seen drop in subcontractor prices upwards of 20%. This suggests that subbies are also desperate to secure a future pipeline of work.
• We’re hearing of some “particularly sharp pencils” in quotes that are being received. The AFR (link) last week shared an article where the winning tender came in at almost 30% below another bid.

There is good news coming for some:

• On Monday, Victorian Premier Andrews announced a $2.7 billion stimulus for the construction industry. The lion’s share of this stimulus will be distributed on education and social housing projects. Builders who work in this space or are able to adapt to these types of projects have the potential to do quite well. 
• Projects that come from the Victorian School Building Authority also have a tender panel limit of 4 builders. Theoretically this should see an even spread of builders who are able to take advantage of the government stimulus.         
• Although it has yet to be announced, other states (link) have hinted in the past that stimulating construction is a key part of their economic recovery plan.

We’re intending to continue this newsletter as we have updated data. We don’t anticipate sending it more than once per week. If this is not helpful for you, you can unsubscribe by using the button below.

The post COVID-19 Industry Impact Newsletter – 19th of May appeared first on EstimateOne.

Happily, our data reflect some of this optimism, though the impacts differ by state and by industry. After a slower fortnight that added the Easter long weekend to any COVID impacts, this last week shows a strong pickup to pre-COVID levels of new tenders. 

It’s important to caution this result with some of the less optimistic reports we’re hearing, especially about slow-downs in demand at the planning and design stages. The forward view remains uncertain, but this most recent week’s uplift is a welcome start.

Below we share some more detailed observations to help you navigate the impacts to our industry.

What we’re seeing: 

Section 1: Aggregate new tender volumes

Commentary:

• The overall volume of tenders has increased from 200 in the week of Easter Monday to 259 this last week – back at the level we were seeing before the first impacts of COVID were being felt
• At a category level, Government tenders contributed the most to this increase; there were 49 new tenders from government last week compared to 25 the week prior
• It’s difficult to disentangle the effects of Easter; two four-day weeks might have delayed some tenders going out (leading to a ‘catchup’ effect) in week 7 which makes us hesitant to attribute this to any specific changes in the effects of COVID, but we’ll continue to monitor week by week

Section 2: State by state view

NSW:

Commentary:

• NSW has now seen 60 more tenders in the 8 weeks from the beginning of March than the 8 weeks prior (497 vs 437).
• Between them, Education and Government tenders represent an increase of 52 over the 8 weeks, offsetting falls in Aged Care, Civil and Fit Out tenders over the same period.
• Although builders we spoke to were seeing delays in tender awards and project go-ahead; (consistent with the awarded work data we shared in our previous newsletter), none were experiencing a slow down in new tenders nor had seen evidence of drop-offs in cost planning to date.

QLD: 

Commentary:

• Queensland saw the most obvious ‘bounce’ of any state this last week, getting back to a weekly new tender level in line with the pre-COVID rate, having seen a steady drop-off since Week 0 of the COVID risk.
• This reflected the experience of builders we spoke to; the slow down had been felt but things were beginning to pick up again. Government tenders, in particular Defence and Medical were listed as the most likely to gain pace over the coming weeks, with an expectation that private tenders were more likely to be delayed where clients were in a position to do this.
• Although the increase in tenders happened across all budget ranges, the biggest increase was in the $10m + category (representing roughly a third of tenders in the state) which increased from 8 to 25 week on week.

VIC:

• Compared to NSW and especially Queensland Victorian tenders have shown a much steadier trajectory throughout the COVID risk period, although the composition of the state’s tenders has shifted by category. Commercial tenders, which represented roughly a third of tenders between weeks 0 and 3 have dipped since then to under a quarter, with the slack being picked up in part by a small increase in Government tenders.
• Builders we spoke to in VIC told us the state had felt ‘flat’ throughout, though wondered whether this reflected a slower start to 2020 more than any impacts of the COVID risk being felt more recently.

What we’re hearing:

• There is steady support for government funded projects, specifically in corrections, public housing and health.  Builders we’ve spoken to have confirmed that this appears set to continue, with confirmations of tender lists for upcoming projects being announced during the last week for new projects.
• Assuming tenders take 3-6 months to prepare and bring to market, some builders are concerned about tenders that should be commencing preparation now, for arrival later in the year
• Both architects and quantity surveyors are reporting a dip in new enquiries for preliminary design and cost plan work, especially associated with new residential projects.
• There is growing concern from several builders around demand for high-density residential projects, especially that which would be classified as “investor stock” which will be more exposed to deteriorating rental market conditions and price expectations.
• Conversely, demand for medium-to-high-density residential projects catering to the owner-occupier market is holding steady.

Looking forward

With restrictions easing rather than tightening, we expect forward conditions for the industry to be impacted more by the demand outlook than by operating conditions. 

On the upside, government projects are already representing a greater share of new tenders and we expect this support to continue, with state governments putting together stimulus packages that fast-track and expand already-planned projects. This support will be intended to offset downward pressures in other sectors. challenges to rental demand and projected falls in house prices are likely to threaten at least some sectors of residential demand, while recessionary pressures slow commercial and retail growth.

We’re intending to continue this newsletter as we have updated data. We don’t anticipate sending it more than once per week. If this is not helpful for you, you can unsubscribe by using the button below.

The post COVID-19 Industry Impact Newsletter – 28th of April appeared first on EstimateOne.

Efforts across the country to ‘flatten the curve’ appear, for now, to be working. The rate of new cases identified is dropping and health systems remain able to handle the volume of patients presenting with the virus.

The Prime Minister has reaffirmed an intention between his office and the State Premiers’ to keep construction sites running, and this is reflected in continued activity across the industry. Tenders are still flowing, projects are still being awarded and construction sites are continuing to operate; although on all fronts we see the impact of COVID-19.

Below we share some more detailed observations to help you navigate the impacts to our industry.

What we’re seeing: 

Section 1: Aggregate new tender volumes

Commentary:

• Tender volumes dropped from around 250 per week to around 220 in Week 3 of the crisis and this most recent week we saw a further drop to 198 – though a shorter week with Good Friday explains this further fall. We expect this coming week, also shorter, to show lower volumes too.
• We have confidence in attributing the March slow down to COVID-19. Last year weekly volumes in March were equal to February numbers, this year they’re ~10-15% down (see chart below)

Section 2: Breakdown by sector

Education:

• In the first few weeks of March, education tenders halved from a high point in late February, but the last two weeks have seen an increase. Clients have mentioned education projects in Government pipelines being fast-tracked to tender as a COVID-19 response which may explain this uptick.

Commercial: 

• Commercial had a more moderate drop-off which was concentrated in tenders above $2m (lower price tenders saw a reduction in the early weeks of the crisis but have since rebounded)

Fitout:

• We anticipated fit-out tenders to be amongst those most affected by the crisis and by the lock downs – but volumes remained higher until this last week where we saw a significant reduction. Our builder clients have suggested that their clients have been seeing opportunities to bring forward smaller projects given their empty offices – this is supported by our data; projects under $2m have actually increased since Week 0. (beginning of March)

Government: 

• New government tenders have seen the most significant drop-off amongst sectors (note that this Category excludes tenders categorised to other sectors like Education or Medical which are likely to include Government clients). This drop-off is accounted for largely by a reduction in small tenders $0-$2m, with tender volumes $2m+ holding steady through February and March.

Residential:

• Residential tenders saw a similar volume profile to Government and Education – with a sharp drop in ‘Week 3’ and a recovery after that. Unlike Government, the reduction in Residential tender volumes has been most strongly in the higher-value tenders $2m+, with smaller projects less affected.

Section 3: Awarded tenders

Commentary

• Our last newsletter in Week 3 showed a drop-off in Projects awarded – a measure that regularly tracks between 70 and 100 at this time of year and which had dropped to 49 for the week. These last two weeks have seen a significant pickup in this measure. This supports what we’re hearing from Builder clients: decisions were delayed as the likely impacts of lock-downs for sites and projects were being assessed, and now that there is more certainty projects are continuing to move forward.

What we’re hearing:

• Builders have been quick in adopting new collaboration and remote working software to enable their teams to work from home – many of the builders we spoke to expect these new ways of working to remain in place even after the COVID-19 risk has passed.
• Although Government clients have shown an inclination to fast-track tenders where possible, this has not (yet) resulted in material volumes of new tenders to offset drop-offs in other categories. 
• The ‘new’ rules and setups for hygiene and social distancing on site are being a norm, but are difficult to execute well (narrow corridors, lifts and doorways present challenges for distancing). 
• Shut-down and clean protocols are well established and in use where COVID-19 cases are identified, with minimal disruption to the progress of a project. The impacts to productivity we’re hearing about are more linked to site-measures than to temporary shut-downs.
• Subbies, suppliers and builders have all spoken to greater optimism in the past fortnight than in the weeks before. The reality of lockdowns has been less dire than many feared, and the determination to keep sites running (despite the objections of some) seems resolute.  

Looking forward

Our view two weeks ago was that stricter lockdowns, like those imposed in New Zealand, were coming. The flattening of the curve challenges this view. If case loads continue to drop, even as authorities work to increase health system capacity, governments may decide Stage 3 restrictions will suffice. 

How long these restrictions will be in place depends on which exit strategy authorities select. Australia finds itself in a rare position globally to have a choice between seeking total elimination of the virus (with longer restrictions in the near term), and attempting a controlled infection rate that stabilises the health system (with lesser, but longer restrictions).

Beyond the duration of restrictions, additional uncertainties remain:

• Contractual interpretation of Covid impacts for clients, builders, subbies and suppliers remains uncertain for now.  Force majeure, repudiation and frustration have all been mooted as protections for stakeholders.  Lawyers we’ve spoken with during the week are optimistic that implied duty of good faith will prevail in dealings between parties during these challenging times.
• With slumping business confidence ([LINK]) and recession-level unemployment ( [LINK]) both looming, the economic outlook is gloomy, however the depth and duration of this impact for construction industry demain remains uncertain. This impact will depend strongly on the degree to which stimulus efforts focus on creating demand. 

We will continue to monitor the impact of the virus and the policy response to it on tendering in our industry in the coming weeks and will share what we find.

The post COVID-19 Industry Impact Newsletter – 15th of April appeared first on EstimateOne.

In the interest of sharing information to help everyone make better decisions, here are some observations made from our own platform. With more than 400 active head contractors and more than 40,000 active subbies and suppliers using EstimateOne, we believe we are well placed to provide analysis to support the industry as we all try to understand what’s happening right now, and what we should do next.

What we’re seeing: 

Chart 1: New tender volumes

Commentary:

• We compared the new tenders added to our notice board by builders from before the crisis to after. We treat March 1st as the ‘beginning’ of the crisis (the 29th of February marked the first significant policy response from the Federal government with the implementation of compulsory self-isolation for returnees from several other countries).
• For the first three weeks volumes tracked ‘BAU’. Last week was the first week we’ve seen a slow down in tenders with 218 tenders compared to an average of 260 in the week previous. Typically the middle of the week is busiest for new tenders, with between 40-60 added to the noticeboard each day; on Wednesday and Thursday this week we had only 22 and 27 respectively (though this picked up on Friday).

Chart 2: Awarded tenders

Commentary

• The number of projects awarded by week is often a ‘noisy’ number for us (it depends, amongst other things, on builders reporting their awards on the platform), but the reduction over the past two weeks supports what we’ve been hearing from our builders – that clients are deferring their award decisions where possible. 

Chart 3: Subcontractor delinquency

Commentary: 

• Cash flow for all parties in the industry is a concern through this period. One indicator we track is the decline rate for credit card transactions (for our noticeboard subscriptions). This rate has increased only slightly from its usual 5% to 5.6% over the past week.

What we’re hearing:

• As of the weekend there is still an intention to keep sites running for active projects. Construction sites are deemed ‘necessary activity’ under the national guidelines, and we haven’t heard (yet) of site shutdowns.
• Tendering is still active and volumes have been ‘normal’ throughout most of March (this corresponds with data shown above).
• Builders are adapting to social distancing rules quickly where this is possible: many have implemented blanket working-from home policies or are working with rotating in-office shifts (dividing the business into teams who rotate in and out of the office). On-site options are more challenging, but builders are implementing new practices for hygiene and distancing on site, creating more space for amenities. Staggered working hours are being considered on some sites.
• Early impacts of COVID-19 are being seen in Head Contractor awards: clients are deferring award decisions in the face of uncertainty in their own businesses and the economic environment (this is reflected in our data). 
• Business Development activity has slowed right down, a combination of remote work plus a desire to defer decisions whilst the outlook remains uncertain.
• Departments of Health are paying additional funds to accelerate progress on live jobs, in particular those which yield additional ICU beds.

Our view of what’s coming

• It’s likely further lockdown restrictions will be put in place, especially if States decide to move on their own. Stage-3 restrictions in Victoria (as an example), adopted after the National Cabinet announcement on Sunday, still permit construction activity to continue, but Premier Andrews has signalled a willingness to move ahead of National guidelines.
• Rules for sites will become more, not less, restrictive in the near term. NZ-style restrictions are likely, where “essential” construction activity is that which is related to the building of essential services and/or human health.
• New fit-out tenders are likely to see a material drop-off as clients defer decisions on new office moves/refurbishments whilst their staff work remotely.

There will be concerted efforts to develop test kits for rapid detections of antibodies, allowing people who have developed an immunity to the virus back on site. UK researchers should announce material progress this week. Link

We’re intending to continue this newsletter as we have updated data. We don’t anticipate sending it more than once per week. If this is not helpful for you, you can unsubscribe by using the unsubscribe button below.

This is a difficult time for everyone. We all have a part to play in supporting each other and our industry through this challenge. 

Our commitment is to continue to provide insights and observations as we see them over the coming months, in the hope that they may help you make the best decisions for your business. If you have questions you think we can help you answer – we’re here to help.  

Our thoughts are with you, your organisations and your families. 

Cheers,

Mike

Michael Ashcroft

Founder, EstimateOne

The post COVID-19 Industry Impact Newsletter – 31st of March appeared first on EstimateOne.

1) Networking:

Getting in touch with new leads is no longer as laborious as jotting down names into a little black book from the tenders section of a newspaper. There’s also no more need to sleuth around multiple sources to work out who all the tendering builders are on a job.

And while you can now access all these details so easily, so can everyone else. If you’re calling into the builder cold, you are missing out on a great opportunity to get a head start on building that working relationship.

Every builder is online in some form or another these days. And it’s not just a matter of jumping on the EstimateOne address book and jotting down a few names or numbers. Try a couple of these tricks to get your networking to the next level:

• Before you call to enquire about a project, note the estimators name and have a quick look on their LinkedIn. Estimators are notorious for being on the move a bit, you might just find a couple of mutual connections from jobs you’ve worked on in the past.
• Have a squiz at the builders listing in the EstimateOne address book and see what other jobs they are working on. If there’s more than one you can help them out with, let them know you’re keen.
• If you’re on a paid plan, have a look at some of the jobs they’ve won recently — a nice congratulations can go a long way, and they might even need your help to get it built!
• Jump to their website. Many of the websites have a “News” or “About” section where you can mine heaps of useful information to drop in conversation.

There is a wealth of knowledge that is so easily accessible. Taking the time to find this knowledge can be worth its weight in gold.

Knowledge is power, and we all know people love it when you take the time to talk about them.

2) Prioritisation:

With all these new contacts comes an influx of invitations to put in a quote. But how do you work out the ones that are actually worth your time?

No one’s getting paid to put in a quote — so it’s important that you’re only quoting the jobs that will most likely to lead to a pay day.

In the marketing world there’s a thing known as lead scoring — putting a number against a lead so you know where to direct your efforts. This kind of system is perfect for many construction businesses.

All you need to do is work out and then codify how important aspects of a job are for you. For example if I was a supplier of glass, I’d be looking to see if my product was spec’d, if I had a prior relationship with the builder and how much of the product I could actually supply.

Then you need to put a percentage rating against those criteria to dictate how important they are. So say:

• Product Spec’d = 45%
• Relationship with the builder = 30%
• Product amount = 25%

Next, put a score between 1–10 for each of the criteria against the job. You just need to multiply your score with the percentage you assigned to it, then add them all up. You can see from the example below that I should be prioritising the St Kilda Trophy Cabinet job:

To get started, Google ‘lead scoring template’ — there are plenty of free options out there you could be taking advantage of.

Once you’ve got yourself into this kind of mindset, you can also start actively searching for jobs that will give you a high lead score.

Tools like EstimateOne’s spec search allow you to find jobs where you can put a 10 next to “product spec’d” straight away by only showing jobs where your product has actually been specified.

The post 3 Ways you should be using tech to win that next job appeared first on EstimateOne.

It probably goes without saying that when you’re quoting a job to a builder, the most important work is done over the phone. After all, it’s an industry built on relationships — and not many people build a relationship over a few emails.

We’ve had a chat to a couple of people who have experience taking plenty of these calls during their work as Estimators. Both of them had a similar take — they both loved to hear the ‘right’ questions.

We were all told back in school that there is no such thing as a stupid question.

While there are no stupid questions, being able to ask great questions can be just as important as knowing the answers.

Those who have worked in the commercial construction business for a while know the importance of having a conversation. Whether it is to introduce yourself or get some clarification on some of the documentation — having a chat is always the best way to get your answer.

Even if you‘re worried about annoying them, it’s always better to be the person who called too much than the unknown random who threw in a quote.

When you’re on these calls with a head contractor — it can be a bit like a quasi-job interview. Think about the difference between these two questions, and the question you’d rather hear if you were an Estimator;

“How do you want me to quote this package?”

“How can we win this job?”

Even if the first question is asked with the best intentions, it can come across like you are asking them how to do your job — and you already know how to do that.

Speaking to Jeremy Barrow — Estimating manager at ABD Group — the best questions he gets from subbies are the ones that teach him something. The estimators on the other end of the line aren’t just working out how to get the best price possible — they also need to work out how they can build the thing.

As an expert in your trade — there’s no real point ringing up asking how they would like it quoted or what they want included, leave the exclusions to your written quote.

Our own Tony Dymock has had plenty of experience taking these calls during his past life as an Estimator. For him, it was all about showing some enthusiastic know-how. Simply put, give solutions, not problems.

Think something like;

“I wasn’t able to price the specified product, but I’ve used a comparable alternative. Would you like to see a sample first?”

This question demonstrates to the builder that you’re here to help with problems, and also that you’re able to help them out reducing costs.

When you get to the bottom of it all, the only question you really want answered is “when can I start?” The best way to get a start on the site, is to show the head contractors you know what you’re talking about.

Take the chance to impart a bit of knowledge, show you’re keen for the job and most importantly — demonstrate that you really know your stuff.

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There’s something pretty unique about the Estimator. Crazy hours, not many quiet moments and having to work within razor thin margins — you sometimes wonder who these nutters are.

Let’s say we stepped into a room of construction students and asked them what they wanted to do when they graduate. My guess is the majority would be keen to be Project Managers. A couple would be keen to get into contract administration. No doubt more than a handful of the ambitious ones are already thinking about what to hang in their office when they become a General Manager.

You wouldn’t guess that many would say they wanted to be an Estimator — you probably wouldn’t even blame the grads for not knowing what an Estimator did.

That pretty sums up the Estimator — the surprise (but super rewarding) career in construction that no one knew they wanted to get into.

ABD Group’s Estimating Manager Jeremy Barrow wasn’t too different to most fresh construction students. When he was a uni he had aspirations of being a PM when he graduated. That was until he started his first role with Kane and was introduced to the Estimating department.

“I didn’t even know what Estimating was”, Jeremy told us — but it wasn’t long until he changed his tune.

The eureka moment was when Jeremy discovered that it was “a business within the business, which is in the business of winning”, and Jeremy liked to win.

It’s not a rare thing to find this competitive streak in an Estimator. After all, there is a rhythmic cadence to putting in a tender. It’s a bit like a season of footy — you know what you need to do, you know the opposition, yet every game (or tender) is completely different.

Jeremy describes it a bit like a university exam every three weeks, but a bit more fun.

“Every three weeks you have a new submission to put in, present to the client, get a bunch of subcontractors involved and work together with this team. In the end, if you are good, you get a win”

But it’s not all about winning at all costs. It’s about winning, and winning well.

Once the building has been built, the client needs to feel that they’ve got the best value, and a high quality finished product.

Construction margins are at an all time low. That means there is a big focus on every detail, and how each detail can be done more efficiently. The Estimating department is at the frontline of many of these cost v quality decisions. Helping navigate a minefield of labour, plant and material trade-offs.

And within all these tradeoffs and concessions, you still need to win the job.

At a strategic level, estimating is about looking at the project and finding the most clever way to build it. What can I find in this project that will get it over the line?

What’s the best way to work with the market out there? What’s the best way to work with the Project Managers and the 100 odd trades you need? What’s the best way to pull together a proposal that will convince the client and get this thing built, and built well?

It’s a lot to take on, and it all can’t be captured in a number. Estimating is just as much about having a holistic view to the project. As Jeremy pointed out to us, the winner isn’t judged solely on dollars — it’s won by those who can find the smartest way to build the thing.

“The pitch is just as good as the price… the dollars mean nothing unless you understand what’s behind the dollars.”

In the end, it’s about being that key cog in the bigger machine. Taking those architectural drawings and working out how we can turn it into something physical.

This is what the love of Estimating is all about. The concept of taking an idea, assembling the right team, and getting the ball rolling on turning that idea into a reality.

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