There are various methods for bidding on electrical jobs. You can bid on the jobs either per square foot or through the estimation file requirements. Bidding on the job through the square foot method is usually the most precise, and that’s what most owners prefer. It gives an accurate and to-the-point cost to the owner. You’re here because you want to learn how to estimate the job through the square foot method. Here’s a detailed guide on it on how to big on electrical jobs through the square foot method:
key takeaways:
Calculate cost per square foot using total land area and project type.
Consider time, effort, and project complexity for profit.
Understanding the Process to Bid on Electrical Jobs by Square Foot
Total Land Area
Total land area is essential to obtain before you bid. We know you might be thinking why would we need the total land area for the per square cost. It is essential, for the sum of the cost. The total pricing reduces as the land area increases, hence it affects the per square foot of the land. The bigger the land area, the cheaper your bid per square foot will cost.
You can use the formula to estimate the electrical work per square foot:
Per Square Foot Cost = (Total Cost – Land Cost) / Building Area
The more you increase the land size, the lower the per square feet cost you’ll get as construction. Similarly, the cost will increase in small land areas. Therefore, it’s essential to obtain the total land area from the owner before bidding on the project as per the square foot pricing.
Ask The Client Or See The Type Of Electrical Work They Want
You must see on the sheet or ask the client about their type of electrical estimate. There are different types of electrical estimations such as:
- Energy Estimation
- Load Estimation
- Wire Length Estimation
- Lighting Estimation
- Power Consumption Estimation
- Voltage Drop Estimation
- Cable Sizing Estimation
- Equipment Estimation
- Transformer Sizing Estimation
These are the 9 most popular types of estimations that most of the clients or building owners may need in the electrical estimation category. Now, you want to know what type of electrical estimation they want from the above 9 types.
The per square foot pricing will always differ from type to type. For example, in load estimation, you give them the load per square foot will consume through the formula:
Load distribution = 100 pounds / 10 square feet = 10 pounds per square foot.
On the other hand, the wiring estimation gives you an estimate on how much length, amount or cost of the wire per square foot. The formula for the wiring estimation is:
Electrical Wiring per Square Foot = Total Length of Wiring / Total Square Footage
As you see, the formula for both items are different, so both require different efforts and time, which influences the average cost of electrical per square foot in your bid. Therefore, it’s always essential to ask for the type of the estimation your client wants.
Factor Out Your Operational Cost And Profit
You’re doing the job to earn profit, right? Therefore, considering your operational costs and profit margin is always a top priority in the electrical work cost per square foot bid. Here, you aren’t investing any monetary item, but rather investing your time, experience, and efforts, and that’s what your client is paying you for.
Your profit margin should be influenced on the following factors:
- Time it’ll take to complete the project.
- Efforts and brain it’ll consume to complete the estimate.
- Difficulty of the project.
All the above 3 points are ∝ bid amount.
You don’t need to worry about the acceptance. A professional client understands the time, efforts and difficulty of the estimate is proportional to the cost of the estimate. Therefore, always bid an appropriate amount as per the market, or a bit lower if you’re a new estimator in the market.
Here’s the visual image for your easy understanding:
Explore the Market
You don’t want to bid an excessively high price that the clients reject your proposal for being too expensive or too low and that clients think it’s a cheap service and not up to the mark. You need to bid a good price that is as per the market, or lower enough that doesn’t sound too cheap to the client.
How are you going to do that? Through visiting and exploring the market. You should at least survey the market pricing of the contractors for an adequate bidding price. We don’t always mean big average pricing, the bidding price always depends on the work, time and efforts you need. However, a market visit can give you an idea of how much the project costs.
Perform an Estimate of The Efforts You’ll Need to Put in The Estimate
You’re of course bidding as per the time, efforts and difficulty of the project, but how would you know how much effort and mind you’re going to give to that estimate? That’s when you use the estimation of your efforts. How can you estimate that? Here’s a detailed section on it:
Estimate the Efforts You’ll Put into the Project
The more effort you put into the project, the higher the bid will be. You can take the idea of the required efforts through the project details mentioned on the sheet. Some high efforts project like:
- Load Estimation
- Power Consumption Estimation
- Voltage Drop Estimation
- Transformer Sizing Estimation
They require complex calculations and other technical calculations and physic formulas, hence more efforts, and so high bid. You can use this equation to obtain precise result:
E = k * P
In this equation, “k” is a constant of proportionality that determines the exact relationship between efforts and pricing. The higher the value of “k,” the more efforts are required for a given pricing level, and vice versa. On the other hand, “p” is the calculations and formulas that you need to use in the estimation project. If there’s no formula, the value of “p” will be 1.
Time that will be consumed in the estimation of the project
The more time you spend on the electrical estimation per square foot project, the higher bid you’re going to place on the project. The time is proportional to the amount of the bid. However, it only refers to actual time as per the average. If you are slow in the work or add delays in the work, that’ll not be added to the cost.
We are only referring to the time consumed to complete the project’s estimate non-stop without delay with an average speed of the human. Therefore, always consider the time that you are spending on the project. The more time is proportional to the bid amount
The equation for that will be:
T = k * P
In this equation, “k” is a constant of proportionality that determines the exact relationship between time and pricing. The higher the value of “k,” the more time is required for a given pricing level, and vice versa.
To better understand the process of electrical estimating, you may find it helpful to review our previous blog post on Key Factors to Consider in Electrical Estimating. In this comprehensive guide, we will dive deeper into the various aspects of estimating electrical projects using the square foot method.
FAQs
What is the square foot method for bidding on electrical jobs?
The square foot method is a bidding approach where the cost is calculated based on the total square footage of the project.
Why is obtaining the total land area important before bidding per square foot?
Obtaining the total land area is important because it affects the per square foot cost. The larger the land area, the lower the per square foot cost will be.
How can I calculate the per square foot cost for electrical work?
The formula to calculate the per square foot cost is: Per Square Foot Cost = (Total Cost – Land Cost) / Building Area.
Why is it necessary to ask the client about the type of electrical estimation they want?
Different types of electrical estimations have different formulas and require different efforts and time. Knowing the client’s desired estimation type helps determine the appropriate cost per square foot.
How does the type of electrical estimation affect the per square foot pricing?
The type of electrical estimation influences the cost per square foot because each type requires different efforts and calculations.
Should I consider operational costs and profit margin while bidding on electrical jobs?
Yes, considering operational costs and profit margin is important to ensure you earn a profit from the project.
How can I factor in my operational costs and profit margin?
Consider factors like the time it will take to complete the project, the efforts required, and the project’s difficulty. These factors influence the bid amount.
Is it important to explore the market before bidding on electrical jobs?
Yes, exploring the market helps you understand the pricing range and ensures your bid is competitive and fair.
What are the advantages of performing an estimate of the efforts required for the project?
Estimating the efforts required helps you determine an appropriate bid amount based on the complexity of the project.
How can I estimate the efforts and time required for an electrical job estimate?
You can estimate the efforts and time by reviewing the project details, considering the complexity of calculations and formulas, and using proportional relationships.
What factors should I consider when estimating the efforts for a project?
Factors to consider include the complexity of calculations, technical requirements, and the level of difficulty involved in the project.
How does the time consumed in the estimation of a project affect the bid amount?
The more time consumed in the estimation, the higher the bid amount, as it reflects the effort and dedication put into completing the project estimate.
