Poor quoting practices and guesswork are eating into construction contractor profits and potentially leading to inferior construction and negative customer experience.
This is according to Graham Alexander, Founder and Director at buildaid.co.za, who recently presented a workshop on How to Quote for members of the Master Builders’ Association (MBA) North.
Alexander says it is estimated that contractors underquote by between 15 and 17% – often through no fault of their own.
“They may be given a set of complicated drawings and based on those, they have to estimate everything – the bricks, the paint, the nails – and the costs involved. It’s a huge task, which in the formal sector is usually carried out by the quantity surveyor. But in the residential market, the homeowner is in charge and they’re reluctant to pay a quantity surveying fee,” he says. “Low cost residential plans don’t include all the information required to quote accurately. This lack of information also stems from the architect or the architectural professional not being employed correctly.”
“Homeowners tend to opt for the cheapest architectural service, so they don’t receive plans with 3D Building Information Modelling that capture all the resources and quantities that contractors need to know about so they can drive those through price buildups – for example a square metre of brickwork including materials and labour.”
Alexander says: “On the average plan in South Africa, 60% of the information you need to quote is not on the plan. Such as what kind of paint, what kind of ceilings, door handles, bathroomware. When the contractor looks at a drawing and starts asking these questions, they realise there’s no information there. It’s a miracle how they come back with a quote. Many resort to a flat per square meter rate and quote, so it’s guesswork. There is no such thing as a standard building rate per square metre, because every building is different, with different dimensions and finishes. Sometimes contractors make a profit, sometimes they don’t.”
“The unfortunate thing is that because they’re working fairly blindly, they’ll get into the project, maybe get the brickwork up, and suddenly realize they’re going to lose money. Then they might use substandard materials or leave things out, so it affects quality. Or it can mean that the whole project stops, professionals are not paid, and the builder goes bankrupt. The bank might have to put in more money reluctantly to the home loan. But if they go about it properly, and that’s what our training is about, this doesn’t have to happen.”
Getting it right
BuildAid’s highly popular courses on quoting have been presented multiple times, to help contractors get to grips with building costs, stakeholders involved in a building project, information and documents required to quote accurately, understanding cost/price categories, the order/process of construction and common categories, rules when quoting, obtaining quantities, information and prices and preparing and submitting a quotation.
“If you’re going to quote properly, it needs to be quick, it needs to be accurate and it needs to be consistent.”
Alexander notes: “We give the contractor tools and formulas that they could use to get a pretty accurate estimate together in under two hours, although they will have to wait for quotes from different people like roof and window suppliers. Most major suppliers are happy to provide a full quote for all the materials required or even the complete installed system, if the contractor sends them the plans. So the contractor doesn’t even have to worry about measuring the roof – they just send the plans to a trusted and reputable supplier in their network.”
Alexander believes proper training is necessary for all stakeholders in the building process – from architects to homeowners. “If you don’t go about it the right way, you’re just heading for disaster. We offer training to enlighten homeowners, architects, manufacturers and suppliers, as well as building contractors.”
BuildAid has also offered a quantity surveying service to builders for 35 years, working on thousands of projects. The organisation also prints books on how to price projects and plans to offer video tutorials for stakeholders.
Amisha Chunderduth, Marketing and Business Development Manager at MBA North says: “We offer courses such as these to help our members operate more efficiently and sustainably, with a view to empowering our sector.”
“MBA members attending earlier courses have commented that the courses are very informative, and that they will apply their new knowledge to improve their quoting skills.”
ENDS.
About the Master Builders Association North
The Master Builders Association North is the amalgamation of the former Master Builders Associations of Johannesburg (founded in 1894) and Pretoria (founded in 1903). The organisations merged to form the Gauteng Mast Builders Association in 1996, and was renamed Master Builders Association North, representing four regions: Gauteng, North West, Mpumalanga and Limpopo. It is a chapter of the master Builders Association South Africa. Based in Halfway House, the Master Builders Association North represents the interests of employers in the building and allied trade industries in the abovementioned four regions. It aims to serve its members by facilitating best practice within its membership and the building industry as a whole.
