Any hard-working professional plumber wants to grow their business. The goal is simple: Win more bids on plumbing contracts. Remain profitable. Unfortunately, this can sometimes be easier said than done.
Our tips highlight what veteran plumbers wished they knew when they first started. Share this with a new plumber venturing out with their new plumbing business! To our professional plumbers, we'd love to hear from you! What would you add?
You may be tired of hearing about it, but it needs to be mentioned. The Covid-19 pandemic has put some pressure on bidding jobs within the industry. With a disruption of the supply chain, high demand for jobs and increasing competition, the construction industry shifted the way they bid jobs in spring of 2020. Maybe you've had to change your approach on pricing, what jobs you bid on, or how many jobs you bid.
In order to win more plumbing contract bids, you must bid accurately and honestly. Providing customers with a reasonable quote and transparent pricing is crucial. It helps you earn the loyalty and trust of the customer.
But how do you best bid on plumbing jobs? What are some of the key things to remember that will increase your chances of winning the bid? Keep reading to see our list of pro tips for winning more plumbing bids.
Generally speaking, there are three types of plumbing job bids. New construction, remodel, and service. You might have a different pricing strategy for each of these three types of jobs.
For instance, when bidding on a remodel job for a homeowner, you could either submit it as time and material, or a flat rate. New construction bids can be a bit more complex and are usually bid using a “take-off” format, based on the schematics of the project.
Regardless, before you put together a bid, you’ll need to make sure you understand the scope of work. Start by gathering information about the project. You may need to review drawings, investigate the jobsite, and/or diagnose any underlying issues.
By reviewing drawings, you can help make sure that you are providing an informed and accurate quote. This is usually only necessary for larger scale jobs. But those blueprints and architectural sketches can make a big difference in helping you understand the scope and complexity of the job.
Getting out into the field and investigating the jobsite will help you get a clear picture of what will be required of you and your team. You may also need to use special diagnostic tools for certain tasks.
For instance, a water heater element that might need to be replaced should be tested using an electric meter.
As you explore and investigate the jobsite, you may start to identify some serious obstacles that could make the job more time-consuming or difficult to complete. Without this knowledge in hand, you could end up underpricing the job… and losing profits.
Once you understand the scope of the job, you can start putting your bid together. But first, you need to start calculating some of your internal costs.
You need to know exactly what it costs to run your business and still be profitable. This is commonly referred to as the “break-even.” It’s the number you need to keep in mind as you start your bids.
It may sound silly, but a lot of first-time business owners underestimate just how expensive it is to run a business!
First, review the following financial calculations listed below. This will help ensure the right profit margin for your bids. Here’s what you need to know:
Simply put – your costs, plus profit, plus overhead determine your quote for every job.
One of the most important financial calculations you need to make is estimating the cost of your materials. This is why it’s so important to gather information about the project and have a solid understanding of the scope of work. It enables you to put together an accurate list of materials needed to complete the job.
It’s a good idea to itemize everything separately to avoid reworking the entire estimate in case something specific needs to be changed later. The more detail you can provide, the better. You might want to use a template or spreadsheet to break everything down as line items.
❔What's your system for job quoting? Leave us a reply in the comments!
Additionally, you’ll want to base your materials estimate on the end date of the project – not on the date you are making the bid. This helps you prepare for potential price escalation on jobs that are scheduled several months in advance.
Of course, having a trusted relationship with a local distributor can help overcome that obstacle. We recommend finding a supplier that offers transparent pricing and a fast, convenient way of ordering your materials.
You could also choose to purchase your supplies upfront. And keep an inventory of your most commonly used materials. That way you know exactly what to list on your bid for these costs.
There is one other factor for you to consider when pricing your materials: the customer’s preferences.
For example, some customers may want you to use premium products that come with all the bells and whistles. Others may want you to only use budget-friendly items. Be sure to communicate with the customer upfront and have a clear understanding of their expectations.
All of these tips will help you better price your materials for your next bid. Remember, having an accurate assessment of the total cost of materials is crucial. Reach out to your supplier if you need help formulating a plan that works for you.
Another major cost of doing business is the time and labor from you and your team.
Time is money, right?
Experience is your biggest asset in determining the amount of time it will take to complete a project. You could also reference industry standards or use a software program to help calculate these costs.
Remember, labor estimates will always be just that - an estimate. But you need to give it your best guess. The most successful companies communicate with their customers if the timeline changes.
You may need to factor in a handful of additional items when bidding on plumbing contracts. Examples include permits, equipment, rentals, and any other job-related expenses. Specific examples are listed below:
In addition to pricing your materials, time and labor, and miscellaneous items, you should also factor in a “buffer” to each of your plumbing contract bids.
It’s common practice in the plumbing industry is to factor in an additional three percent buffer. You might choose to go slightly above or below this number. But that’s a good starting point for most professional plumbers.
Professional plumbers know that it’s always a good idea to give themselves a buffer when putting together new bids. It helps ensure that you can turn a profit. It also allows you to handle small changes to the project without having to surprise your customer with unexpected fees.
A bonus tip for making your bid stand out from competitors is to add a value proposition statement. Show the customer that you’re eager to help them solve their plumbing problems. This can build trust and rapport with the customer. Especially if they’re a new client.
This doesn't just apply to the residential plumber. Sell yourself and your company! Your confidence in your skill and ability will likely shine bright to your prospective customer.
For instance, maybe you have more experience than any other plumber in the area. Maybe you have better warranties. Or maybe your reputation for fair and friendly customer service is unmatched by anyone else.
These kinds of details can help you win more plumbing contract bids. Even if your rates end up being a bit higher than other bids that the customer has received.
Wiseway Supply is a family and locally owned company that has been servicing the Southern OH and KY region since 1972. We understand how important it is for you to win more plumbing bids in order to grow your company and remain profitable.
As an established distributor, we can help you speed up your projects and cut back on expenses. We offer competitive pricing, priority shipping, and can create a personalized inventory for products you love and trust the most.
In fact, we increased our in-stock inventory levels to better combat lead times, shortages, and price increases for our customers.
Wiseway Supply is your trusted resource for helping you speed up projects and keep your supply costs down. So that you can submit competitive bids. And win more jobs.
You can always shop our site and checkout as a guest, but the best experience happens when you create an account and let one of our representatives personalize your online shopping experience.
Based on your conversation with our team, we will build you a custom eCommerce portal where you can shop for the specific items you need and manage your account.
Oh, and there’s one other thing.
Just because you’re required to order supplies doesn’t mean that it should be boring! Earn rewards points on purchases that you can redeem for discounts, gifts, and more.
Is there something you'd add to our list about winning bids?
How have you changed the way you bid jobs?
Let us know in the comments!