When you’re preparing an estimate and then creating a great proposal you will be probably doing a fair amount of ‘builder speak’. The question I have for you is; “do you think the customer understands what you are saying?” There are certainly times when the customer/prospect doesn’t really need to understand everything (do they need to know how many noggins are required for a wall over 2400mm? No, of course not.) but there are times that is vitally important they understand what you are proposing to do, or not to do. In addition, if there’s a grey area or you’re unsure of the cost so you have given them an allowance, do they really know what that means? I would guess often not.
I have noted below just a few of the items that should be clarified for your prospect/customer before you commence any building works. And it may pay to also check with them even if you have made it clear as day in your proposal. As my engineer used to say, “if in doubt, ask”.
If I’m quoting on behalf of a trade then putting in an allowance as opposed to a fixed price makes a lot of sense. Areas that I always (repeat, always) have as an allowance are electrical and tiling. Mainly because I have no control over the customer pointing or asking for additional works. Allowances are not for the supply of PC items. And there is another builder’s term.
Architects refer to PC items and PC sums. Customers are getting two languages here even though we are apparently in the same business. I would describe PC items as things such as kitchens, appliances, carpet etc and would give examples. PC sums are often construction allowances for say, excavation. I would remove the term ‘PC sums’ and just stick with the word ‘Allowances’. But remember, it will pay to explain it clearly to the customer.
Inclusions and Exclusions
Seems quite straight forward to you, however did the customer see the note and did it make sense to them? If your proposal said ‘excludes all PC items’ did the customer know what a PC item was in the first place?
Cost Plus vs Fixed Price
An age-old problem here. When you are only prepared to do a job as Cost Plus but the customer wants an idea of cost you are providing an ESTIMATE. This is completely different from providing a QUOTATION which is for a fixed price job.
BuildManager makes it very easy for small builders to note clearly in a proposal what is included, what is excluded, what is a an estimate and what is fixed price. But it’s always worth mentioning the fact that these are noted in your proposal, in your opening letter. And if you think they might not have understood something – ask!