In any construction project, the client is aware that an estimate is not the final number; it’s a roundabout figure. But if your estimate is way off the mark, the client’s project budget will go for a toss and so will your credibility as a contractor or builder.
A construction estimate can be inaccurate due to many reasons, such as incorrect pricing data, faulty schedules, and manual errors. If you’re facing any of these issues and are constantly worried that your quotes aren’t accurate, it’s time to consider using construction estimating software.
Per our 2021 Small Business Construction survey*, in which we spoke to 538 construction professionals, 48% of respondents purchased new estimating software in the past year and 42% say improved cost estimation accuracy is a top positive impact from adopting new software. (For a more detailed look at the survey and its results, check out 5 Construction Trends in the New Normal.)
One thing’s clear: Using estimating software can increase the accuracy of your construction quotes and provide your business an edge over your competitors.
What is construction estimating software?
Construction estimating software, also known as construction bidding software, helps streamline and simplify the sometimes complicated process of creating cost estimates for construction projects.
Want to learn more about construction estimating software solutions? Check out our buyers guide to understand the benefits and common features of these tools.
In the next sections, we dive deep into the software features and functionality that help you create accurate estimates and win more bids. We explain how construction estimating software benefits your business and contributes to your project’s success.
Removes calculation errors with automated cost estimating
Factoring a cost estimate manually, either by hand or using an Excel spreadsheet, is inefficient and has a higher risk of calculation errors. You’ll have to spend hours crunching numbers and double-checking the figures to ensure you’ve got the rates, taxes, etc., right. And that’ll delay the process of creating estimates and submitting them to potential clients.
But with the cost estimation feature of construction software, you won’t have to worry about complex codes or formulas because the software will do all the calculations for you. That way, you can quickly figure out the cost of materials and labor while making adjustments to ensure you have enough overhead to make a profit on the project.
Also, if your client wants to add or subtract something to or from the initial bid, you can make adjustments on the fly, which would be a time sink with manual methods.
Offers up-to-date cost databases for material prices
Up-to-date material prices are key to creating an accurate estimate. And although you may have an idea about the cost of building supplies in your area, market trends suggest that material prices have dramatically increased over 2020-2021.
When creating a construction estimate, the last thing you want is to assume that material costs are the same as your previous project or even what they were just a week back.
With construction cost estimation software, you get access to an online tool that scans cost databases, such as RSMeans, for the current prices of materials. The cost database feature gives the most recent cost of building supplies in the area you’re servicing. Therefore, you can rest assured that the quote you create will be an accurate representation of current market prices.
The software also lets you create your own cost database of regularly used items. That way, you’ll have easy access to the prices of the items you use most commonly.
Provides prebuilt templates to help create professional estimates
When creating an estimate, do you use a Word document? Do you type each line manually? Do you worry about spelling or grammar errors? Does the document have your company branding built into it?
Estimating software offers prebuilt templates to help you create professional quotes. The page structure is already designed; all you need to do is enter the client specifics. You can also add your company logo and change the background color and image.
Ask yourself: What’s more impressive to a potential client? A plain Word document that’s barely formatted, or a professionally formatted and itemized list? One takes time, and one can be done with a click of a button.
Next step: Use construction estimating software to increase the accuracy of your quotes
At the end of the day, your livelihood as a general contractor depends on winning bids, and that starts with ensuring your clients get a consistent and professional experience, from the first phone call to the end of the construction project. And the most vulnerable part of any construction project is estimation.
Software helps simplify the entire cost estimating process. You’ll be able to get quotes out more quickly, you’ll have updated material prices to use, and you’ll have the peace of mind that your quote looks professional and presents your brand in a way you can be proud of.
Methodology and disclaimer
Software Advice conducted the Small Business Construction Survey in April 2021 among 538 U.S.-based workers in the construction/contracting industry in small business. Respondents were screened for employment status (employed full time), annual business revenue (<$100 million), and number of employees at respondent’s company (1-250).
Note: The applications selected in this article are examples to show a feature in context and are not intended as endorsements or recommendations. They have been obtained from sources believed to be reliable at the time of publication.