Estimating and Job Costing

Properly customized, the right software saves paperwork, time and money.

February 29, 2004

Typically, the hardest part of implementing technology in a business is deciding which technology to implement. Knowing that accurate estimating lies at the heart of profitability, choosing an estimating program can seem over-whelming. Industry consultants stress the importance of knowing and mapping out your company’s systems and processes before making any decisions. Consider these questions:

  • How do you gather pricing data for your estimates?
  • Do you design using CAD?
  • How do you turn estimates into proposals? Into contracts?
  • How do you track actual labor and material costs versus estimates?
  • Can you run work-in-progress reports?
  • How do you handle change orders?
  • What kind of accounting program do you use?
  • Do you communicate with clients, suppliers and subcontractors by fax, e-mail or PDA?
  • How many employees does the estimating process involve?

    Case Study:

    Podesta Construction

    Three years ago, Podesta Construction’s estimating system consisted of handwritten proposals, HomeTech software, and stacks of papers with pricing information from subs and suppliers.

    “There was no job costing so to speak,” recalls vice president Matt Podesta, who co-owns the full-service San Francisco remodeling firm with his father, Jerry, the president. “We didn’t know how many man-hours we had into a job. We didn’t know what the materials were by cost code, so when bills came in, we had nothing to track against.”

    Armed with a degree in business economics and accounting and three years’ experience as a financial consultant, Podesta worked with his father to understand which elements a remodeling estimate had to include and then began assessing available software programs. Seeking an integrated program with detailed estimating and job costing, a scheduling option, and the ability to customize labor rates, import cost data and manage contracts and change orders, Podesta chose Intuit Master Builder.

    Podesta Construction had its own cost-code structure, so he did not purchase Master Builder’s estimating database. Instead, he loaded in the costs of materials, subs, equipment and other items with Podesta’s codes, applying dollar values whenever possible.

    Why upgrade your estimating software from a Microsoft Excel spreadsheet if you’ll just have to import that data into another system? Matt Podesta cites two primary reasons: proposals and job costing.

    Most estimating software programs make it easy to turn an estimate into a proposal and eventually a contract using a template, customizable or your own. “Once I print an estimate and a proposal, that’s now the basis for a contract, and I can print changes orders against that contract,” Podesta says. “Those are all the deliverables that go to the clients.”

    Then there’s the ability to compare actual and estimated costs without having to export and reformat data from Excel or to print two reports and go through them manually. Podesta says work-in-progress reports help him make adjustments before project’s end and make a better profit.

    As the firm has grown — from $1 million to more than $2 million during the past few years — making sure that profits keep up with sales is more important than ever.

    Which software program fits your company?
    Program
    Price
    Works with
    Data source
    Contact info
    BidBuilder
    Starts at $795
    QuickBooks Pro, Microsoft Excel and Project, Primavera, AutoCAD, Solid-Builder, ArchiCAD, Chief Architect
    Database of up to 13,000 items and 100 assemblies for residential and commercial construction; can import RSMeans databases and your own data
    www.digitalcanal.com/ bb.shtml
    800/449-5033
    HomeTech Advantage 4.0
    $1,295
    Chief Architect, QuickBooks Pro, HomeTech Office Manager
    Four databases, 214 cost regions, more than 10,000 items and 20 assemblies, updated quarterly; can import own data
    Intuit Master Builder 2004
    Starts at $1,895
    Xactimate for Remodelers, WinEstimator, Quest Estimator, Cadsoft, ACT!, GoldMine, Microsoft Office
    Add-on module includes database of more than 19,000 parts and materials and 1,000 assemblies; also can import your own data
    masterbuilder.intuit.com

    800/726-6278
    ProEst Estimating
    Starts at $995
    Microsoft Project, Primavera, QuickBooks Pro and Contractor Edition, Timberline
    Pre-built database of 12,000 items; can import RSMeans databases
    www.proest.com
    800/255-7407
    QuickBooks Premier Contractor Edition
    $499.95
    ACT!, Microsoft Word, Outlook and Excel
    Can import your own data; also works with HomeTech Advantage, WinEst and Craftsman National Estimator
    www.quickbooks.com
    888/729-1996
    Timberline Estimating
    Starts at $2,200
    ArchiCAD, Cadsoft, Microsoft Office, Primavera, WinFax Pro
    Database with 4,000 items and 700 assemblies; RSMeans databases; can import your own data
    www.timberline.com
    800/628-6583
    Xactimate for Remodelers
    $58/month per seat
    QuickBooks Pro, Master Builder, ACT!, GoldMine, Microsoft Project and Word, any CAD program with .dxf file
    440 regional price lists for labor, equipment and materials; updated every 90 days
    www.xactware.com
    800/424-9228
    UDA Construction Office Remodeler 2003
    Starts at $299
    QuickBooks, UDA Scheduling, Microsoft Project
    Database with 1,200 categories and items

    Submit questions or ideas for this department to Kimberly Sweet at ksweet@reedbusiness.com or 630/288-8170.

  • About the Author


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