Blog: Contractor Chatter

What Most Contractors Don’t Want You to Know – You’ll Pay 20-40% MORE than the Free Estimate Quoted

Free Estimate


(frē – ĕs′tə-māt′)

tr.v. es·ti·mat·ed, es·ti·mat·ing, es·ti·mates

  1. To calculate approximately (the amount, extent, magnitude, position, or value of a project).  Written and  provided without cost to a consumer of services.

There are an average of 450 – 550 ‘’contractors’’ simultaneously operating in each city within the boundaries of King County at any given time.  What is worse, you can find over 5,100 listings related to remodeling contractors near Bellevue on alone.  Furthermore, there is no single standard in which contractors approach estimating.

Does this matter? Well, if a contractor is offering a ”free estimate” (approximate amount your project will cost), what will keep your project from exceeding your personal budget?  Most of all, the odds that 100% estimating accuracy will be achieved are slim to none.  This is confirmed by the Bureau of Labor Statistics noting that over 80% of builders will close their businesses due to cash flow issues soon after start-up which will leave you with the short-term ‘’tail-light warranty.’’

Michael Gerber describes the problem in his book, The E Myth.  He stated these individuals are simply good tradesmen attempting to scratch their ‘’entrepreneurial itch.’’  This revolving door has inundated the market with firms using outdated methods and ineffective management strategies at the expense of their clients.

Top Four Reasons for Contracting Business Failure

Reports indicate the leading causes of business failure are:

  1. Bad estimating techniques and issues with cash flow
  2. A contractor’s lack of business management ability
  3. Inadequate project management skills, and
  4. Low competency of general building knowledge.

Scary, right? You do not want a contractor that falls into one of these categories trying to keep your project within your budget after you approve their free estimate.

A Better Alternative to the Free Estimate

The fixed price proposal.  Unlike the free estimate this process is based on:

  • Predetermined selections
  • Accurate quantity surveys
  • Concise material take off lists
  • Fixed subcontractor quotations
  • Design features that have been chosen to fit your budget, and
  • Recorded industry data that ensures installation durations for craftsmen have been accurately priced.

Due to a free estimate typically consisting of a brief one or two-hour home visit, this method sounds like it takes a lot of effort on the contractor’s part and it does.  That is why most firms who provide fixed proposals will usually charge a small fee for their consultative services.  Their ”estimate process” is really composed of thorough project consultation services.  This initial cost is worth the investment because you will get so much more in the long run.  As a result, you get a project that is guaranteed to meet your budget and other goals without unnecessary cost overruns.

It Makes Sense

Often times, free estimates end up with missing items, hidden fees, and costly change orders. That is why consumers need to acknowledge that you really do get what you pay for.  The fact is, no contractor can offer the best service with great quality for the lowest price.  As a result, you need to decide which of these areas, if any, are what you willing to sacrifice?  Making the right choice will make or break your project.  It will determine your overall experience, the quality, timeliness, and amount of emotional and financial stress you will have to deal with.

When you are ready to get going, the first step is to finalize your budget and be ready to stick to it.  You need to review your finances and consider how much you can realistically invest in your home as a good contractor will perform ‘’value engineering’’ on your design ideas.  This will assist you in developing a feasible and affordable design and is another item that simply is just not included in a standard free estimate. Look for a contractor who provides fixed price proposals.  A firm which implements budget control strategies to minimize job-cost overruns and will maximize your investment.

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