How to Estimate Electrical Work? Step-by-Step Guide

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Are you an electrical contractor? – Struggling to find the correct ways of creating estimates for your electrical jobs? You’ve landed at the right place. In this blog, we will take you through the electrical estimating process in detail, along with its importance, so that you can bag more jobs and accelerate your business.

The electrical contracting business is highly dynamic and competitive at the same time. For each new project, you have to generate a fresh quote and follow the standard procedure of bidding.

While at it, you have to ensure that your estimate charges the potential client just the right price for your electrical contracting service. A price that is competitively low to win against other contractors but sufficient to cover the entire project expenses, from labor and material costs to indirect expenses and your revenues, optimally.

This process of determining the total expense of the electrical project is known as electrical estimating. It helps you gauge the line of services required and gives the clients an insightful view of where their money would go.

Since one wrong move could cost you the job, it is crucial to get your estimates right every time for each project, whether it is with a new client or an existing one.

So what should you do?

Simple. Devise a standard flow for estimating all your electrical projects. To give you a headstart, we’ve answered your question about how to estimate electrical work in the easy yet most effective way. It would not only speed things up but also keep the estimates as accurate as ever.

What are the Steps to Estimate Electrical Work?

  1. select the right projects for electric estimate

    As an electrical contractor, you should never say yes to all the projects that come knocking on your door to simply keep the money flowing. If you wish to grow your business, first understand your expertise. Know whether you’re best at industrial electrical construction projects, commercial ones or residential electrical jobs, or a mix of these options.

    Each of these domains has its unique set of requirements that either an experienced or an expert electrical contractor can fulfill. Thus, the first step to bidding for the right electrical job is to identify the scope of your specialties.

    Doing so helps you focus on trying for projects you know you would complete exceeding client expectations. It also prevents you from bidding for work where you possess zero to minimal experience or high chances of mistakes, causing you reputational damage, financial losses, or both.

    Therefore, it is wise to stick to the projects you feel confident in to present a precise, reasonable bid. And as you gain experience, you can tap into new horizons gradually with as much efficacy.

  2. Review the Specifications

    Where does the project stand in terms of its present electrical spectrum? Are there any abnormalities or oversights? What are the client’s requirements and expectations from the fresh electrical work if you end up winning the bid? To get answers to these questions, you have to analyze the project specifications carefully.

    Unless you get the specs right, you cannot gauge what type of work you’re expected to provide. And without the clarity, your estimates would suffer – you would end up underquoting or overestimating – losing the bid in both cases.

    The only way to avoid such a scenario is to cautiously review the specifications of the electrical work. Get your doubts cleared. Include alternatives, too, if you feel the need to and get approvals for the same in writing to avoid future disputes.

    The clearer you are about the specs, the more precise your estimates would be.

  3. Analyze the Drawings

    analyze the drawings for electronic estimate

    As an electrical contractor, you may receive drawings, graphics, and blueprints along with the RFPs for an in-depth idea about the electrical requirements. Study these visuals closely to create a clear scope of work.

    Moreover, ask for architectural images of the site, if you can, to understand all the technical details, including working elevations and heights, better. Apart from that, do not forget to make a note of the premise’s current plumbing and HVAC system wirings.

    What if no drawings are provided? Arrange for a walkthrough of the site to assess the work scope.

    Whether it’s a residential job or a commercial project, all these components affect the material and labor costs, as well as the equipment requirements. Failing to consider even one of these aspects can make your material takeoffs inaccurate, turning your estimates and efforts ineffective.


  4. Pro Tip

    Look out for any disparities between the specs and the drawings, jot it down and bring them to the client’s attention.

  5. Identify the Necessary Materials

    The accuracy of your estimate depends upon how precisely you can determine the materials required, along with their quantity, to finish the job successfully. This task of listing down the materials is known as material takeoff.

    Such a list would include every single material that you would use for the electrical project: right from circuit breakers, light fixtures, and receptacles to the number of electrical outlets, panels, and switches.

    The detailed breakdown of the necessary materials simplifies the execution of the project. Besides, this takeoff also enables you to identify the anticipated yet near-accurate total material costs, increasing the precision of your final estimate.

  6. Calculate Labor Costs

    calculate labor costs for electrical estimate

    Once you are clear about the scope of work, as well as material takeoff, it’s now time to assess the project’s labor requirements. How many workers would you need, on-field and off it? How much would you pay each of them? What would be the pay rate? Finding answers to these questions is central to arriving at the total expected labor cost of your electrical contracting job.

    While some electricians prefer hourly wages, some workers charge an upfront fee for the entire project. Make a list of the hourly and upfront compensations, and add up the numbers.

    Determine the total number of hours you think the project would take and multiply it with the sum of the wages. Don’t forget to keep a window for accidental damage and overtime hours. That way, you would get a precise cost of labor which would boost the authenticity of your electrical estimate.

  7. Create the Estimate

    create the estimate for electrical work

    Now that you have all the essentials figured out, the project scope, labor, and material needs with their respective costs, it’s time to put them together in an estimate. You could use your previous estimates to get started or create one from scratch.

    Using a modern electrical estimating tool for this purpose is also a great option. Such systems come in with a range of estimating templates and automation of manual processes, such as calculations, making your estimates sleek, professional, and error-free.

    Whether you’re using the tool or creating the estimate on your own, ensure to itemize the proposed materials. You could also create a template of the commonly used items to complete and submit estimates faster.

  8. Add Your Profit & Overheads

    At the end of the day, you are a business. And you have to make profits to survive. That’s why your estimates must include your profit margins, as well as overhead costs to run your business.

    Once you’re done summarizing the overall job cost, add a profit markup that you want for each of the jobs. However, make sure the markups are also in line with the standard rates in your local area. Apart from that, factor in your business overhead expenses like insurance and transportation costs to the estimate.

    The general overhead percentage tends to range between 12% to 20% of your business sales cost. It may vary based on the size and scale of your operations. So, give it careful thought before adding final numbers to the estimate.

  9. Develop a Proposal

    More often than not, electrical estimates make for a small part of the larger proposal that you submit for the bidding process. Thus, once you have the final sales price ready, build a professional proposal.

    It should detail every minor component of things your estimate includes and the things it excludes with clarity. Outline terms and conditions, if any. Keep the language similar to the project specs and drawings documents. Doing so saves both parties from future conflicts while building trust to start on the right note.

  10. Double-Check Everything

    Before you hit the send button to submit the final estimates to your prospective client, review your proposal thoroughly. From material and labor costs to the final project quote, ensure there are no mistakes.

    Recalculate the numbers if you want. Double-check client details, including their name and address. Correct any faults that you come across, hand over the final proposal, and keep a copy for your records.

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Ending Note

Creating an electrical estimate is a comprehensive process. You have to make sure there are no loopholes or unreasonable prices to win the project. What we explored in this blog is a simple checklist of steps you could implement to estimate the total project expenses.

Feel free to adapt these steps to suit the standard operations of your business. It would help structure your estimating operations and speed up the entire process.

To create estimates and invoices in simple steps, all you have to do is adopt InvoiceOwl which allows for managing and streamlining your business process in just a few simple steps.

So, what are you waiting for? and explore a range of features and functionalities.

Author Bio
Jeel Patel
Jeel Patel
Founder

Jeel Patel is the Founder of InvoiceOwl and is the main curator & writer of the content found on this site. With ideals of quality, commitment, and perseverance, he believes in creating lasting business relationships with the clients.

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