Fundamentals of Estimating

      How does a newcomer learn the basics of estimating cabinet work?

Question
I will soon be opening a commercial cabinet shop in the DC NoVA area. I don't have a background in estimating. The shop will do commercial production p/lam frameless cabinets and p/lam square edge countertops. I can't really afford to hire an estimator at this time. Any info on pricing the above would be very helpful.

Forum Responses
(Business and Management Forum)
Opening a commercial casework shop without knowing how to estimate is a bit rash, but it's how most people start out (yours truly included, though I was lucky enough to learn on someone else's nickel). In fact, you do know how to estimate if you know how to do the work you plan to do, but you will have to find out a few things before you start, regardless of how you go about it.

Look into AWI, get a cost book, and go to the next estimating seminar. In the meantime, you will have to establish your overhead, labor burden and come up with a shop labor rate - either average or variable by employee type - and get a list of all your material costs, then figure out what it takes, product by product, to build what you plan to build.

Having spreadsheet skills is very helpful because you can make templates for each product and save a lot of repetition. If you want a powerful framework in which to do this, I recommend a program called Takeoff, which is an estimating program created by a commercial shop in Canada, that will guide you in the thinking and structure through the process of setting up the program. True 32 Business Partner is also excellent, and there are others such as Alliance Millsoft Project Pak, and probably many I don't know about that will similarly impose a discipline on your developing system, and will help you not to leave anything out.

But you have to know what it costs you to do the work, not what it costs someone else. I strongly recommend you avoid rules of thumb, percentage of materials multipliers, what the market will bear, or other methods that have brought a lot of people grief.

Once you have set up your system, you will find a myriad of variables having to do with different architects, contractors, specifications, locations, etc., that you will learn about by sometimes harsh experience. You may find, on reflection, that you actually can afford a skilled estimator, because the consequences of bidding and winning significant projects without knowing much of this are pretty grave. You should also look at the Cabinetmakers.org website. Membership is very reasonable and members share very good information, ready built spreadsheets, etc.



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