When the going gets tough in electrical construction, contractors tend to get tough by bidding more jobs. That’s what’s happening in this “Great Recession” for companies big and small, young and old, those with computerized estimating – and the others.

That’s been the case for Douglas L. Gill, Inc., of Midlothian, Va., where Thomas Wade, project manager/estimator, noted recently that the company has, in the past two years, gotten roughly three times the former amount of estimates out the door than it did in better times.

“There are a lot more bidders on these jobs, and some of them clearly are determined to outbid everybody else,” said Wade, who has been with the 20-year-old company since 1996. “We see jobs in which there are five or six of us clustered within 3% to 5% of each other, which is what you would expect with contractors who have been around for a while."

“But the winning bidder is something like 30%-40% lower than our bid and those of the other experienced companies. A lot of times, it’s an inexperienced contractor coming out of the woodwork trying to do a commercial or industrial job. I guess these people don’t have professional estimating software to help them with accurate pricing!”

Gill Grabs An Edge

McCormick software was in place when Wade got there, 14 years ago; the company now uses the Win 8000 system. Gill pursues institutional work (including hospital projects) and commercial (including big-box retail and large apartment construction). The company had been happy with the product’s performance before the recession, Wade reported.

But the program has really come through for the contractor in this difficult period. While there are some late nights spent bidding, the effort needed to get 3 times as many bids out the door has neither resulted in inaccurate bids nor a need to add staff – nor an overwhelming amount of weekend work.

“The biggest thing McCormick has done for us is that it’s allowed us to produce accurate estimates in a timely fashion,” Wade said. “It’s very easy to learn. All of us in the office (Douglas Gill, his father Henry, a staff estimator, and Wade) have gone to Maryland at one point or another, to take the course that McCormick offers with Erle Howard. He does a great job of explaining the ins and outs."

“We know that the system has more in it than we will ever use.”

A key in Gill’s approach is teaching people who once knew nothing about electrical work to estimate jobs. “We’ve had three estimators in here, in my time, and each had no electrical experience. Not a little, none. One was a lady who came to us from a retail environment, one was a lady that had been a draftsman, and one was a gentleman who had been a manager of a furniture plant."

“I think all of them had the same thought upon starting out and looking at the computer and the drawings – which was usually, ‘I can’t do this.’ But the McCormick software makes it pretty easy. They all turned out to be pretty good estimators!”

Why use strangers to the field for estimating? Wade, who had electrical construction field experience before becoming a project manager/estimator, noted that estimating might be easier for someone learning it from scratch. “The hardest thing, when you come out of the field, is putting on blinders and doing the estimate,” he said.

“By ‘blinders’ I mean – you look at the plans, and you see problems that are on the drawings. As an electrician, you can not help but see the potential problems when they are there. Somebody who has not been an electrician does not let that interfere with making an accurate takeoff."

“Of course, those problems are going to matter later on. But in terms of getting the bid process completed, you have to ignore all of that if you want to be competitive.”

Controlling estimating – and growth

Gill has done a bit of design-build work in the past, as well as security and fire alarm work using McCormick software to do the quotes. One problem it unfortunately hasn’t had lately is controlling growth. But that’s a company philosophy that remains in place.

“Douglas L. Gill does not bite off more than we can chew. When times were better, we didn’t run out and bid some project that required us to hire another 30 people that we didn’t have. We’ve seen others bid projects like that. It seems to always end up in a lawsuit.

“So our approach is to try to keep enough work coming in that we can do successfully, and profitably, while maintaining quality workmanship” Wade added. “This approach has earned us more than one repeat customer."

“In doing our estimating, the key for us – in which McCormick helps – is to make sure our labor and material pricing are accurate. We also compare what we have bid, on jobs we’ve performed, with what happens in the field. Sometimes we’ve dropped the labor some, sometimes we’ve increased it, depending on our field reports."

“With the labor and material accurate, we feel like we’re ready for bid day. All of our numbers are correct. We know our numbers will not get us in trouble. With McCormick, we know our numbers are accurate. We have confidence in what we have put together.”

What about the competition? “When you go to conventions, you can hear some contractors talk about being in all day on a Sunday doing estimating – and, they say, they still can’t get any work. This holds true for all of us but our odds are better using McCormick software."

“But many folks are bidding in some of the old-school ways – on paper or using ballpark prices, like so many dollars and outlets or ‘X’ amount of dollars per square foot. This works for some, perhaps; but I do not believe it works for the majority in today’s market."  

“They don’t see what McCormick’s software is – for us in the office, it’s a tool, just like a conduit bender or a screwdriver. You’ve got to get to a point, like where we are, that you know you can count on the software to handle the hard part as long as you count the assemblies and press ‘Enter. ‘"

“We have used McCormick for a long time – and we will continue to do so. It has helped us really crank out the estimates, with confidence. It has been and will continue to be an asset in any economy, and it’s helped us pick up the work we needed accurately and efficiently when we needed it most.”

Price Updating options in Version 9.2

Products your field crews will install make up a significant percentage of any project’s cost to you – and your bottom-line bid won’t be correct if you don’t get these prices right in your estimate.

How does your McCormick software (V9.2) help you do just that?

Note that while the services outlined below are provided by

third-party vendors, the capability of working with each is built into the software you already own (no extra purchases from McCormick are needed).

PROJECT PRICE UPDATES

The idea: You have a project. You want to attach accurate prices for each product to be used in that project into your estimate.

Alternatives:Trade Service’s Supplier Exchange and NetPricer.

With these services, you get up-to-date prices from distributors that work with the vendor systems. These are imported right into your McCormick estimate.

Key: Your product database doesn’t change. These services update the project, not your database.

How many prices can I obtain? You’ll have to consult the vendors for specifics. We at McCormick Systems have seen one of these handle prices on a contractor’s specific project from six of its local distributors!

DATABASE UPDATES 

Trade Service’s Tra-Ser SX update the parts databases that reside on your computer. You update the database on your computer as frequently as the vendor specifies( usually quarterly, monthly, or weekly). McCormick’s software accesses the database on your computer to give your estimate a price for each item.

Key: The key function is to match the product identifier (“DCI code”) in your database with the product code in the information supplier’s database. If there is a match, the price and accompanying information are updated. If somehow there is a mismatch on a number of items, the numbers don’t match – and your database starts to get out-of-whack.

Vendor-specifics:

Tra-Ser SX – a major enhancement in McCormick’s V9.2 software allows you to “set and forget” updates to this database . . . which means you can set it to update at a specific time, go home, and come in the next day to find the database updated.

Additionally, SX checks the matching of those DCI codes. If there are products you have in your system for which Tra-Ser can’t find a DCI code, you get a list (every time you do an update) of anything the Tra-Ser SX system does not recognize.

Also, with the upgrade on the Trade Service side, now when you do an online update, you are accessing Trade Service’s online database – instead of what used to happen, which was, basically, updating with a text file from a CD that was mailed to you, any mistakes you will have to wait for the next CD.

Bottom line: In these days, McCormick’s customers are all sharpening their pencils. With these various services – Trade Service’s Tra-Ser SX , Netpricer, and Supplier Exchange – you can get very accurate product pricing, even up to and including multiple current prices from numerous local electrical distributors directly from their database with your discounts.

 

Version 9.2 Feature Recap

 

• Updated  Job Screen
• Updated Job Details linked with Bidsummary
• Traser SX integration with unattended updates
• Bid Summary Labor Groups made easier
• Extension report order sorting
• Update NECA labor units with Traser
• Supplier Pricing inside Edit Extension

 

Job Screen– previously you had two tabs, “active” and “inactive” jobs. Now, you can have up to 20.

Example: You can have tabs with headings by the estimators in your department (tabs named Tom, Dick, and Harry). Or you could have tabs that break down your past jobs by year (2009, 2008, 2007, etc.). OR: If your company has several offices (Brooklyn, the Bronx, Bayonne, and Camden), or even job type (residential, commercial, hospitals, bids won, bids lost, etc.)

These tabs can be re-arranged and also marked invisible to hide older jobs to reduce clutter and still have the jobs available.

Updated Job Details linked with BidSummary

Now you can create Job Details that are linked to your bid summary information. These details can be assigned to the job screen and displayed along with job name, lead estimator, etc.

This is also covered by security and you can force all users to view the same set of detail columns, this allows you to have the project managers and owners view the square foot price and final sell price of all jobs, while hiding these specs from the standard estimators.

Unattended updates

With 9.2 users can now set up the Trade Service Price updating to be run unattended, This allows you to set it to kick off once a week and view the log files at your leisure. These report files are now stored as internal files that are kept so you can look at past reports without worrying about printing them at the time you did the update.

4. Traser SX integration

You can now validate any existing UPC/DCI code to see if it does not exist within Traser’s system. This will help you flush out any items that are discontinued or otherwise invalid.

5. Labor Group creation easier

When you create a new labor group the program will ask you if you would like to copy an existing group.

6.  Extension report order sorting

If you have rights to edit the extension reports there will be arrows allowing you to sort the order of these reports.

Now you can move your most common reports to the top and drop all the non used ones to the bottom

Supplier Exchange

Trade Service’s Supplier Exchange is another new service from the vendor. You can now use this with McCormick software to evaluate prices from multiple suppliers and, if you like, “cherry pick” the prices you like from each supplier.

The update takes seconds for each vendor and comes free with your trade service subscription.

No more manually loading price update files.

2010 User's Conference -
Mark Your Calendar!

Your Best Investment Of The Year

There’s plenty to worry about in 2010, from whatever Ben Bernanke is thinking about doing next to how many competitors you’ll end up bidding against on the next run-of-the-mill job.

You could definitely look at your March calendar right now, and enter the letters W-O-R-R-Y on the five days of that week. But – wait! Perhaps you could put that time to much better use.

Come to McCormick Systems’ 28th Annual User’s Conference – a proven benefit to our customers over almost three decades.

We promise that you’ll come away RICHER. OK, we’re not going to put cash in your pocket! But you’ll learn something – if not from our instructors during the formal sessions, then from your fellow attendees (other contracting company owners, estimators, and project managers).

Download the single-page registration form.

Death of the Raised Floor?

eWeek magazine ran an article, Greening Your Data Center: The Real Deal. Here's a piece, which surprised me (which just indicates I'm not up on trends in this niche bizniz):

Believe it or not, 2010 will toll the death knell for the raised floor.  As hot air rises, cool air ends up below the raised floor, where it isn’t doing much good. In addition, raised floors simply can’t support the weight demands placed on them by high-density racks.  A 42u rack populated with 14 3u servers can weigh up to 1,000 pounds.

Raised floors are simply not efficient operationally. I had the experience many years ago of building a 10,000-foot data center n a large city. Several months after it was built, we began to have intermittent network outages. It took many man-hours to locate the problem: Rats were chewing through the insulation on cables run below the raised floor. Rats aside, additions, reconfigurations and troubleshooting of the cable plant are much easier on your staff when cables are in plain sight.