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How To Estimate Commercial Electrical Work?

We all know that commercial kitchens demand regular cleanliness and inspections. The same is true for electrical work. Regardless of industry type, routine electrical maintenance checks are instrumental for businesses.

At the same time, performing accurate commercial electrical estimates is also very important. It allows different construction firms to allocate resources effectively. Aside from that, contractors can make well-informed decisions throughout the construction work. However, inaccurate estimates can result in delays and budget overruns, affecting the electrical systems’ quality.

Estimating the commercial electrical work is quite challenging and needs much perfection.

But the question is, “How to estimate commercial electrical work?” Read on for more details!

Ways To Estimate Commercial Electrical Work?

Knowing how to estimate electrical work precisely can help you win more projects and profit. If you want to ensure that your estimating strategy is profitable, you need to consider many things. For example, they may include overhead, materials and labor.

Below, we’ve enlisted some crucial ways to make your commercial electrical work the right way:

Review Job Specifications

In case you are up to bid on construction or commercial electrical projects, you’ll receive an RFP. RFP is abbreviated as the “request for a proposal.” In addition, this RFP usually comprises the critical specifications of the job.

So, if you want to end up with smooth electrical work, review the documents first carefully. It will help you ensure that your electrical estimations perfectly reflect the specific RFP requirements. However, if you face any difficulties while reviewing, it is best to clarify it by asking questions.

Analyze Project Drawings

Another way to estimate electrical work is by analyzing project drawings. Besides, these drawings play a considerable role in deciding the success of your construction work. Ensure to analyze the construction and architectural drawings.

It’ll let you know the electrical requirements. Ensure to pay attention to HVAC, elevations and plumbing. If you are performing the electrical job for a home and the owner can’t provide you with drawings. Then, you can understand the work necessities by requesting a walk-through.

Perform Material Takeoffs

A material takeoff is nothing but a detailed inventory list required for the electrical work. Depending on the project scope, the material takeoff may comprise conduits, light fixtures, and switchboards. It can help calculate cost estimations.

You can use this information to measure the budget required for each material. Additionally, the price for electrical wiring and total materials can also be calculated through it. You need to keep this crucial material takeoff document in handy. It is an effective way to estimate electrical work.

Evaluate Labor Costs

Once you’ve clearly understood the project requirements, it’s time to determine how much labor is needed. Moreover, the labor cost can be easily calculated by multiplying the hourly labor rate by the total number of labor hours.

Commercial or residential electricians usually charge per hour. It is all up to you how much to charge your electricians. This is how evaluating labor costs helps in making precise estimates.

Calculate Overhead Costs

Overhead costs typically refer to the operational expenses required to keep your business running flawlessly. For instance, it may be for office rent, business equipment, insurance, taxes, electrical equipment, and work vehicles.

You can calculate the hourly overhead rate by dividing the monthly overhead costs by the number of billable hours per month. But, to figure out the electrical work overhead costs, you need to multiply hourly overhead costs by the number of hours required to complete the job.

Decide the Profit Margin

You might need to learn the terms profit margin and markup. In short, profit margin refers to how much money you generate after determining all the costs. In contrast, markup is nothing but an amount that you get after applying the profit margin. You can calculate the markup by following:

(Hourly rate + Material cost + Overhead costs) × 0.15 = Your markup

Afterwards, add this markup to the total cost estimate. Now, you’ll get the electrical work price.

Create an Electrical Estimate

An electrical estimate should comprise the business name, an estimator number, the validity of the estimate, etc. However, several electrical estimating methods, including Google Sheets, can take much time to complete manually.

If you have a clear estimating template, it will take only a few minutes to make an electrical estimate. This is how you can make accurate budget breakdowns to win more bids and projects.

Why Estimates Are So Important?

Estimates are of significant importance in commercial electrical work. Because they lay the foundation of a profitable project. Check out below why electrical estimates are so important:

Why Estimates Are So Important

Improves Project Management

Accurate electrical cost estimates assist construction agencies in creating effective project planning. Also, it helps make well-informed decisions regarding scheduling, resource allocation, and procurement. Consequently, it reduces the risks of pricey revision during the process.

Ensure Competitive Bidding

Precise electrical cost estimations offer significant benefits during the bidding process. For example, organizations that can present error-free estimates can have highly-secured contracts. Remember, customers appreciate the professionalism and transparency linked with estimations.

Help Avoid Cost Overruns

No matter what the construction project is, it is vulnerable to various uncertainties, leading to cost overruns. But, by accurately estimating electrical work, you can overcome such risks. Thorough cost assessments are extremely worthwhile in identifying potential challenges.

Streamline Project Budgeting

One of the other advantages of electrical estimates is that they help streamline project budgeting. Not only this, but also estimators leverage their industry knowledge and expertise to provide precise estimates. Therefore, estimates are critical in planning your budget effectively.

How Should I Create An Estimate Or Quote?

Do you want to create a quote or an estimate for your electrical work? Follow the below steps:

Choose a Template

Creating winning estimates or quotes is a learning process. So, the first step to creating a quote is choosing a template. You can customize your templates by adding the logos and letterheads of your company. However, make sure to select the right quotation template for your business.

Add Customer Information

Once you’ve selected the template, it is advisable to add client information now. For instance, it may include the phone number, address, business name, email address, and fax number. But, if you are using your company letterhead, there is no need to include the contact information.

Enter the Quote Number

Accounting software automatically will create a specific quote number by adding increments. Still, you can edit the quotation number as per your desire. If you’re sending multiple pages in the same email, the software will consider including individual numbers on the quotation sheets.

Enter Services or Products

Now is the turn to add services or products in the quote. It may include the product number, quantities, total price of each item and unit price in the description. However, following the different pages of the commercial electrical project, you can divide the services and products.

Include Notes

Notes are a good thing to detail the expected completion date and timelines for the project. Further, it would help if you summarize the scope of your project. Show professionalism by saying thank you to the customer for the opportunity to quote. It’ll help build trustworthiness.

Add Terms and Conditions

Above all, you need to add terms and conditions in the quote. Explain to your clients under what situations additional work might be needed. Besides, you can also include when and how they can pay you. For example, whether you accept a Credit card, a debit card, or other methods.

Include the Issue Date

The next thing to do is to include the issue date in the quote. Show clients when you will send the quote. You might not know, but quotes are time-restricted offers. Hence, it depends on you for how long you want to extend the timeline. Despite this, you can also decrease the timeline.

Consider Adding Optional Details

Lastly, you can add optional details in the quote, including a discount, signature section, sales tax, and business number. When creating a quote for estimation, this is a good idea to consider.

Difference Between A Quote And An Estimate

Pondering how to estimate commercial electrical work? You must also know the difference between an estimate and a quote. It would help you end up with accurate estimation results.

So, a quote is usually a figure that a supplier provides to the contractor for the cost of materials needed. In comparison, construction estimating refers to measuring all the required costs for the project. For instance, it may include indirect costs (office work salaries and equipment depreciation) and direct costs (worker wages and materials).

However, when it comes to choosing between an estimate and a quote, you need to consider several things. Like quotes are legally binding. But, if you have no idea of the costs involved, it is better to go for an estimate. But, there is a need to ensure that you don’t label an estimate as a quotation. Because this will show that you are held to that particular cost by the customer.

How Much Detail Does An Electrical Estimate Need?

As a rule of thumb, it is necessary to add as many details in your commercial electrical work as possible. Moreover, potential clients want to see the following things in an electrical estimate:

  • The total price
  • Contact information and the business name
  • Work description
  • A detailed work breakdown 
  • Name and address

The breakdown of the electrical project should comprise materials, labor and additional expenses. Because it will help clients better understand the final pricing. In addition, it is also advisable to show whether the total electrical work price includes any taxes or not.

How Much An Electrical Estimate Need


Knowing how to create accurate cost estimates and how to charge electrical work can grow your business. Furthermore, it can assist you in winning more bids for new commercial electrical jobs. Above all are described the key elements you need to consider when generating estimates. Once you send the estimates, the next is to convert the quotations into invoices.


Why is accurate estimation important in commercial electrical projects?

Accurate estimation is very important in commercial electrical projects. Because it enables construction organizations to allocate resources more effectively. Additionally, it also helps them make the right decisions to avoid cost overruns and project delay problems.

What information is essential to gather for a commercial electrical estimate?

Determining the cost of materials and labor required is a crucial step in creating a commercial electrical estimate. To be precise, you need to have an understanding of the current market conditions and the trade and a broad experience as well.

How do I conduct a site inspection for estimating commercial electrical work?

You can conduct a site inspection to estimate commercial electrical work by visually checking for cracks, breaks, or overheating signs. However, for estimations, site inspections can be easily conducted using the latest inspection software.

What factors determine the scope and requirements of a commercial electrical project?

This includes assessing the number of outlets, power and the types of lighting required for the project. Based on the planning and calculation, the engineers will design the electrical systems. At the same time, estimators will provide budget breakdowns for the installation process.

How do I assess the material and equipment needs for a project estimate?

It is necessary to identify all the materials and resources required for the given project. So, for that purpose, you first need to split your task. Now the text thing to do is to figure out the resources and equipment needed. More detailed and smaller tasks ensure higher accuracy.

James Oliver

With over 10 years of dedicated experience in the electrical estimation industry, I have honed my skills and developed a comprehensive understanding of the nuanced requirements that drive successful electrical projects.

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