Category Archives: Commercial

Commercial Electrical Estimating Methods

One of the difficulties when growing your company is the step up from residential to commercial estimating. The work is more complex, requiring a more complex estimating method to match. Here is a recap of the residential estimating methods I am aware of, with thanks to the members at Electriciantalk.com. 

1st Method, Unit Pricing – Some contractors have a list of unit prices they use such as $100 for a cut in receptacle or $2000 for a service change. 

2nd Method, Price Per Hole – In my 1 month working for a residential contractor, we used this method for apartments and condos. Each hole (receptacle, switch, fixture outlet, etc.) cost $9 (it was a long time ago). Add labor and material for the fixtures, switchgear and feeders.

3rd Method, Square Foot Pricing – This method can be used if you have accurate historical data that matches the work you are bidding. 

4th Method, Material Plus Labor Allowance – The contractor puts together a priced material list and adds an allowance (such as 2 men 4 days) for labor.

All of the residential electricians I have talked to use an estimating method based on one or more of the methods mentioned above. Some use a combination of methods. Some enhance these methods with custom built spreadsheet templates.

The forth method is closest to the way commercial estimates are prepared. Instead of a labor allowance, labor is calculated for each piece of material. The labor is expressed as decimal or whole portions of an hour, and is called a labor unit. Here is an example of a duplex receptacle.

            4S Box                               .20 (.20 * 60 minutes = 12 minutes)

            4S 1 Gang Ring              .10 (.10 * 60 minutes = 6 minutes)

            Duplex Receptacle      .20 (.20 * 60 minutes = 12 minutes)

            Plate                                  .05 (.05 * 60 minutes = 3 minutes)

            Total = 33 minutes

Here is the hard part. Labor units are subjective, meaning they do not always work with a particular installation situation. Labor manuals with one column of labor units are meant for “normal” labor situations. Other manuals have multiple columns, one column for normal and other columns for more difficult installations.  Make sure you read the scope of work covered by the labor units in the manual you obtain. There are differences between the manuals.

Where do you get these labor units? If you purchase a computer estimating system, it will come with built in labor units. Labor guides are also available from a number of organizations. A quick search of the internet came up with well over a dozen.

The above is only a brief description of commercial electrical estimating. There is much more to it, and proper procedures should be learned or you risk losing money on projects. There are several ways to learn the process. N.E.C.A. offers classes in many areas. There are many books available. There are also a few universities that teach electrical estimating.

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Electrical Estimating Per The Electrical Specs? Are You Kidding?

This title reflects a growing trend I have seen since the recession started. I have been able to document the fact that many bidders are ignoring the specifications and bidding to the minimum electrical code requirements. Some are qualifying their bids as being per the NEC, believing that this relieves them of the responsibility to follow the specifications.

 I understand the need to resort to this kind of bidding, but even though times are tough, this is a very risky practice. Sometimes the bidder gets away with this strategy, or is able to work out a deal with the owner. Other times, the bidder is made to comply with the specifications and will lose money on the project (if he does not walk off).

 The most prevalent practice I have seen is bidders ignoring a specification requirement that all conductors be run in raceways. They base the bid on MC cable instead. Other bidders substitute commercial or residential grade devices for specification grade devices. I have also seen aluminum conductors substituted for copper. How does an honest contractor compete with this kind of bidding? How can you level the playing field?

 For my company, I have started making these kinds of substitutions in my bids. I keep it honest by writing detailed qualifications in our proposals. I also include adders for the specified materials and methods if the customer wants them. I believe (hope?) that this kind of proposal will prompt the GC/Owner to ask if the others contractors are bidding to the plans and specifications.

 As usual, I am interested in your opinions, so leave a comment and let me know what you think.

The Branch Takeoff Argument

I learned my trade from two excellent estimators, a series of N.E.C.A classes, and of course, the school of hard knocks. I was taught to measure the branch conduit. Everywhere I have worked, it was expected that the branch conduit would be measured. All this was on the west coast.

Soon after starting this company I begin getting work from the east coast. Imagine my surprise when I opened the plans and found that the branch was not engineered. No solid lines. No dashed lines.  No hash marks to indicate how many wires. Just circuit numbers at the outlets.

 At first I thought this was a fluke. Maybe it was just one lazy engineer. But that was not the case. Most of the projects I received from the east did not have engineered branch. At first, I drew the branch in, and then took it off. This got to be a very time consuming on larger projects.

 While this was going on, I switched to the ConEst Intellibid estimating system. I soon found that the fixture and outlet assemblies included the branch conduit, and prompted for the average footage between outlets. Since ConEst was developed by an east coast estimator, I started to get the picture. Fortunately, I was able to find a mentor who taught me how to take branch off using the averaging method.

 Being west coast trained, I am more comfortable with measuring. For my customers that prefer to save on estimating costs, I will use averaging, very carefully. Consider a project I recently estimated, a large furniture store. The main sales floor lighting consisted of about (50) 12’ tracks. If an estimator did not study the circuiting very closely, they could have missed the fact that each 12’ track was on a separate circuit with an average homerun close to 100’. Additionally, the specifications did not allow combining of circuits in homeruns. This could have been an estimating disaster.

 So this leads to the argument. Many estimators believe strongly that the only safe way to take off branch is to measure it. Others argue with equal passion that measuring is a waste of time, time that could be used to get out more estimates per estimating dollar.

 I am looking for comments on this topic. Please let me know how you feel about this argument.

Okanogan P.U.D. Office Building

$50.00 per square foot? For a commercial office building? You have to be kidding. Didn’t these projects used to run under $10.00 per square foot?

My point here is that square foot costing can be a very dangerous way to bid projects these days. One reason is that material and labor costs continue to increase rapidly. Another is the number and complexity of systems being stuffed in new buildings today. Here are some of the reasons this building was so expensive.

  • A very expensive DALI lighting control system with daylight harvesting and dimming
  • Two sidewalk and pavement snow melting systems
  • A complete computer server room with two Liebert UPS systems
  • An extensive data and telephone network

Early in my career, I estimated and managed a high end office building on the corner of Wilshire & La Cienega in Beverly Hills. The shell was a little over $3.00 per square foot. Even though it was in a high rent district, the building had nothing special in it. California codes did not require anything special. If we constructed that building today, it would include additional scope such as a tele/data network, code required energy management systems, ADA compliant life/safety systems and a security system with CCTV. Technology systems and code changes continue to add new costs to these buildings every year. 

I suggest you keep a log of the square foot and per unit costs for every project you bid and construct. If you must use square foot pricing for a budget or (heaven forbid) a contract estimate, tread carefully. Make sure that you analyze the scope of work closely before committing to anything.

Long Island Railroad

We bid a project for the Long Island Railroad (LIRR) last Friday. The scope was to  convert the underpass at Sutphin Blvd and the LIRR Jamaica Station into a retail center. This was a very interesting project. The inside of the project was fairly standard, but the outside brought a little of Las Vegas to New York.

The sidewalk had uplighting, downlighting, in-sidewalk lighting and a ceiling with hundreds of color changing LED fixtures. In addition, low-bay lighting was added to the bridge structure over Sutphin Blvd. I want to see this when it is finished.

Of note on this project was problems with drawing scale. Both the digital and paper documents were not even close to the stated scales. This problem continues to get more prevalent. On some documents the inacurracy is subtle, only making your takeoffs just a little bit short. Other projects like this one will have you winning a project with half the needed conduit in your estimate. I strongly recommend that all drawings be checked for scale accuracy before starting takeoff.