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How to Start a Commercial Construction Estimating Department: Is Your Team Ready for Growth?

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Growing into a successful, mature construction company means expanding in more ways than just your field crew. You need experts in accounting to keep your books in order, project managers to handle coordinating the ins and outs of each job, and of course to keep those lucrative jobs coming in, you’ll need estimators.

How do you know when it’s time to start a full commercial estimating department? Let’s do a deep dive on why, when, and how to build and grow a team of estimators.

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The Role of an Estimating Team and Its Importance to the Construction Business

An estimating team is the first line of defense against inaccuracies and poor planning for growing construction businesses. Without designated estimators, your company runs the risk of missing out on great opportunities and not targeting the right types of projects for your skills and bottom line.

A dedicated estimating team will have the resources, know-how, and bandwidth to evaluate each potential project for fit, scope, cost, and potential profit to maximize your company’s earnings.

You can divide the task of estimating among employees with other responsibilities, but once your business has grown to the point where you can support a true estimating department, you should consider doing so as soon as possible.

Trained estimators who spend their days doing takeoffs and creating estimates will be much more skilled at these tasks than others who are spread too thin, and your salespeople and field crew can focus in on what they do best, leaving bids to the experts.

Why Are Accurate Construction Estimates Important for the Success of Your Business?

Your estimating team will be able to put together extremely detailed, accurate estimates, and this is where your company can really begin to shine. An accurate estimate means you’re more likely to win the bid, and more likely to finish the project with higher profits.

This is because the more precise an estimate is regarding counts, measurements, and labor hours, the more room there is to adjust markup to your desired profit margins. Good construction cost estimators will have these skills down to a science, and they’ll also excel in the art of balancing the odds of winning with the profits you need.

After all, winning isn’t everything, and you need to know you’ve got folks on your team who can take you to your revenue goals – people who understand the nuances of direct costs versus indirect costs and where those apply.

Where Can You Find Resources for Your Team to Learn about Cost Estimating?

If you’re looking for resources for professional development for a novice team, there are three great options.

1. Learning from a mentor.

The best teacher for estimating is often experience. The longer a person has been in the field, the more they develop their instincts for accurate estimates. If you’ve been the primary estimator in the past, you might actually be your team’s best resource and secret weapon. Train them on your methods, or you might consider hiring someone from outside with experience who can mentor your new team.

2. Traditional cost estimating books.

For traditional learners, a search on Amazon or your local library branch will result in plenty of books on construction cost estimating written by experts. Some even include general guides to material pricing across regions so your team can get a feel for the numbers.

3. Online resources and software providers.

There are a lot of construction websites and blogs out there, and you might be surprised at the great content that’s created by the folks that power some of your favorite tools. Be sure to check out the resources available from platforms like Procore and STACK for the latest industry news and expertise.

What Courses Can Your Team Take to Improve Your Construction Cost Estimations?

If you’ve got some go-getters on your team, you offer tuition reimbursement, or you’re looking for what types of programs to screen for on resumes, take a look at these schools that offer courses and full programs around construction management.

  –  Drexel University

  –  IUPUI

  –  University of Cincinnati

  –  Auburn University

  –  University of Missouri

  –  Oklahoma State University

  –  United States Air Force Academy

How to Start a Commercial Construction Estimating Department

So, you’re thinking it might be time to start a full-fledged estimating department within your commercial construction company. It’s a step in the direction of success, but it can be a challenge to get started. We’ve got tips to help you decide when it’s time to pull the trigger and suggestions on how to get started.

5 Factors to Consider When Creating Your Estimating Department

1. How do you define the construction estimator role?

You’ll need to have a solid handle on exactly what you expect your estimators to spend their time on. Look up job postings from companies that are similar to yours in size and service area to learn how they are defining the position. Will you expect your estimators to liaise with subcontractors and suppliers, or will they be strictly measuring plans and preparing estimates? Will they need to collaborate with other estimators or work independently? Will you need them to handle risk management and make adjustments to contracts, or is that someone else’s role at your firm? Answering questions like these in the beginning will help you attract candidates with the right skillset.

2. Will you hire from within, conduct an external search, or a combination of both?