Estimating Buying Strategies
7/29/13
Items to Buy/Negotiate:
1. Scope:
A. Scope from documents B. Winter/weather conditions C. General requirements D. Logistics E. Escalations
2. Price:
A. Base price B. Alternates C. Unit prices
3. Schedule 4. Commitments
A. No extras B. Service C. Quality D. Future projects, last look etc. E. Relationships & Contacts F. Staff
Strategies for discounting/buying jobs;
Predominantly there are 2 main types of projects with varying hybrids that offer multiple scenarios. The 2 main classifications are, Hard bid private/public sector and negotiated projects. Each of these can utilize some of the strategies in the other groups. It is important to understand the contract terms as it relates to buyout, contingencies, allowances, who has use of the contingencies/buyout, when is the savings calculated and distributed. 1. Hard bid - usually the job is discounted and you’re trying to get back your fees or enhance profitability. A. Don’t attack the fees B. Approach the job from a production rate perspective. Review production rates, crew sizes and listen for cost savings in what they tell you. C. Understand who the second tier subs are and know the market. Identify other second tier subs with better prices. D. Help the sub negotiate with their second tier subs
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