There are certain items every contractor needs to consider to adequately and fairly place a value on any potential water feature project design. As with any other project, properly pricing a water feature installation is critical to the success of your business.
There is one thing contractors should never do; this important issue can single handedly destroy this industry. Never underbid a job just to get that job. Remember, underbidding a project may get you the job but cost you in the end. Every time contractors underbid a project, they hurt themselves, their business and the industry as a whole.
By pricing your projects fairly and competitively without gouging your customers, you can be successful without having to undercut your competitors. By offering higher quality materials and components, better service and attention to detail you’ll be able to meet the demands and wishes of your client.
When pricing a project, here are some of the basic items to consider:
- The type of water feature desired – Each type, style and size of feature has different costs associated with its installation and has its own set of pros and cons regarding cost.
- Client wants and needs – Many times a client will tell you exactly what they want. If you ask the correct questions you might discover that what they want is not exactly what they need. As a professional, this is your responsibility to point this out to them.
- Site selection – Where is the best location for the particular project for maintenance, visibility, enjoyment and use? Selecting the correct location for a water feature project can make a big difference in the overall cost of the structure.
- Excavation – How easy or difficult is the excavation site? Is there access for heavy equipment or will it need to be dug by hand? Can you use all the excavated soil onsite or will you spend valuable resources and labor hauling it off? Installers often must pay to dump excess soil somewhere. Watch out for underground utilities; call ahead and have them marked or you might spend a lot of cash making costly repairs.
- Proper component selection and placement – Selecting and installing the correct equipment and components for a practical and functional water feature can be critical for the end satisfaction of your client. Make sure you select equipment designed to perform as needed under the present environmental conditions.
- Aesthetics – Choosing the correct types, sizes and amounts of materials can be essential in the end appearance of your project design. Making one small mistake can ruin the best of intentions. Do not cut corners when selecting your materials. Choose the right materials that will result in the appearance the client wishes to achieve.
- Labor – Calculating the number of man-hours needed on a particular project is the single most expensive issue we are faced with on most projects. Knowing how many people you will need on the job and how many hours each man will work each day is an expensive endeavor that can cost you dearly if miscalculated.
Several water feature installation companies have used this formula successfully for many years: Calculate your total out-of-pocket expenses for the proposed project, and then triple the amount. If a project costs you $2,000 to install, charge the client $6,000. If the project costs you $7,256 to install, charge the client $21,768.
Here is how this amount breaks down:
The first third is your actual out-of-pocket costs. It is gone. You used this amount to pay for everything you needed to make the project materialize – your design work, employee labor, materials, components, supplies, specialized equipment, everything.
The second third is for your business operating expenses, such as office space, office furniture, computer, printer, ink and paper, pens and pencils, Internet access, separate laptop or tablet, business insurance, digital camera, unemployment insurance, business license and permits, telephone service and equipment, cellular phone service and a cell phone, business cards, brochures, advertising, website, website hosting, vehicles, vehicle signage, tools and other work-related equipment, employee hats and shirts, professional association memberships, attending business-related educational events or conventions, and more.
The third portion of the amount charged to your client is your profit. This allows your business to grow and advance in the future to keep you viable in the marketplace. Without profit, your business is dead in the water.
There are many other items to consider, but always make sure that you adequately price the project so you and your business profit from your efforts. Otherwise, you might find yourself looking for another line of work.
Many thanks to Rick Bartell for putting together this list. Rick is one of the foremost experts in water feature design/build with over 30 years of experience.. You can visit his site at http://rickbartel.com/.