• It is obviously not obvious.

    I teach a lot of people how to estimate electrical projects. I also teach or at least share my experience of running an electrical contracting business with many new people with little more than a dream.

    You would think if you are starting an electrical contracting business that a few things would be obvious like:

    • Having a name for your company.
    • Having the correct license.
    • Having employees.
    • Having a way to get your employees to the job.
    • Having enough tools to get started. Cords, ladders, drills, benders, etc.
    • Having enough working capital to pay your employees.
    • Setting up an account with an Electrical Supply House.
    • Having a few customers willing to give you work or at least bid their work.
    • Some idea of how to obtain work.
    • Know what type of work you will be targeting. Service work, Commercial, Industrial, Residential, etc.

    There are just some things that you would think anyone going into business for themselves would know, thought out, and have in place before even thinking about opening up shop.

    Obviously not obvious. If the topic isn’t obvious then these subtopics want be obvious either.

    1. Having a name for your company.
    2. Branding your company.
    3. Logo
    4. Business cards
    5. Letter Heads
    6. Advertising
    7. Creating an introductory package of your company and sending it to the A list of General Contractors that you are targeting. Let them know why they should use you.
    8. Do you have a company goal or plan? Where will you be in 1 year?
    9. Having the correct license.
    10. Maybe you have a Master License but need an Electrical Contracting License.
    11. Maybe you also must pass a business test.
    12. In most places you must provide financtual statement that will determine how much you will be licensed for.
    13. Do you need additional license to work in surrounding counties?
    14. Do you need continuing education to keep your license active?
    15. Having employees.
    16. Have you thought of how you can get employees and what the cost will be to hire them?
    17. Will you offer a Truck, 401K, Vacation, Bonus, and Phone? Do you know what that will cost per year? Raises, profit sharing, etc.
    18. Getting and keeping employees is one of the hardest parts of starting a new business.
    19. Having a way to get your employees to the job.
    20. You can have your workers show up on the jobsite or meet at the office and be transported from there.
    21. How will you get tools on the job site? Will your Forman’s have a truck with tools?
    22. Have you priced insurance for your vehicles?
    23. Have you prices workers comp insurance? Building insurance. Do you have a bonding agent?
    24. Having enough tools to get started. Cords, ladders, drills, benders, etc.
    25. Will you use job trailers? Keep your tools on the trucks, vans etc. Use tool boxes, which often get stolen or broke into.
    26. Having enough working capital to pay your employees.
    27. From the day you win the bid it may be months before your first draw.
    28. Someone has to prepare the estimate, submittal process, print the plans, answer the phone, quote out the material, release the orders, etc.
    29. Setting up an account with an Electrical Supply House.
    30. This can be a little work when starting a new company. You will purchase material before you ever get your 1st draw. You can have thousands of dollars of material purchased that has to be paid for. Do you have a line of credit with your bank?
    31. Having a few customers willing to give you work or at least bid their work.
    32. Where and who will you work for? Do they pay well? Can you trust them?
    33. Do you know how plans are posted in plans rooms etc? Are you a member?
    34. Do you understand the bidding process? Do you understand that sometimes just throwing a low number at a contractor still may not get you the job? Contractors want to work with sub-contractors that they know and trust. They may even share your number with their favorite sub.
    35. Some idea of how to obtain work.
    36. You do understand that you can’t survive being low bid on every job. Building relationships is the key to survival.
    37. Building relationships is key to being successful in business
    38. Know what type of work you will be targeting. Service work, Commercial, Industrial, Residential, etc.
    39. You can’t be all things to all people.
    40. A Commercial electrician usually is horrible when it comes to wiring a house.
    41. It is very hard to manage and run a service center and do new construction as well.
    42. You must find a niche that suits you.
    43. Even on top of that it is a great idea to search after a specific type of job for example Truck Docks. I am not suggesting go after Truck Docks if you are a Residential contractor but once you have completed one or two you know all there is to know. All the questions have been answered and you also know the cost to finish one. Find a contractor or two that build Truck Docks and follow then doing their work. This is just an example.

    So all of the above is obvious information for anyone thinking about going in business right?

    Obviously not obvious.

    You can have the nicest building in town. You can have a fleet of new trucks. You can have the best Superintendents, Project Managers, Journeyman, and Apprentices +++++BUT+++++

    IF YOU DON’T KNOW HOW TO ESTIMATE it does not matter.

    You will fail or succeed based on your ability to estimate.
    You must not only have work you must have profitable work.
    It all starts with the estimate!

    It is like building a multi-story building. If the foundation is not perfect it does not matter what you place on top of it.

    If the estimate is off, you are doomed from the start.
    Starting an electrical company without estimating skills is like:

    • Purchasing a plane without knowing how to fly.
    • Joining a fishing club without a boat.
    • Joining NASCAR without a driver.
    • Being a carpenter without a ruler.

    You would be better off to go to a Casino and bet it all on Red.

    Estimating electrical project is the first step. From there you must take the estimate and manage the estimate to make sure it all goes as planned.

    It is as simple as that but without the estimate nothing else matters.

    Electrical Estimating Software is a must in any Electrical Contracting Business.
    There are many to choose from. Simply put the Best Bid Hybrid Pro by Best Bid is the very best bang for the buck out.
    Before you purchase electrical estimating software you need to at least have a basic understanding of electrical estimating. Best Bid can help there as well. www.electricalestimatingclass.com. Join our On-Line School for Electrical Estimating where we give you the foundation and simple steps to create an accurate electrical estimate.

    Purchasing electrical estimating software is essential in running an electrical contracting company.

    This is a true statement but you must make up your mind that you are going to master it.

    Obviously this is not obvious.

    We get customers every week that call and the first thing they ask is “How soon can I get the software?”

    Then they say I have a couple of estimates I need to get out today and I need the software ASAP.

    Note: I am not saying it is impossible but for 99.9% of the people that purchase our software you want complete a real estimate the same day as you purchase the software.

    Again these are things that you assume are obvious.

    • You should know how to estimate with pen and paper.
    • You should understand man hours
    • You should understand the function of an assembly
    • You should understand what you profit and overhead run
    • You should understand you labor rates
    • You should understand that you will get quotes from your supply house on Lights and controls, Gear, Fire Alarm. Items like that. You want bring these items in from a database.
    • Understand how and when to add for difficulty. It takes longer if it is 30’ in the air on a lift.
    • You should know that your prices are correct.
    • You should know what you want the buttons to do when you select them.
    • You control the information given when you select the buttons.

    Best Bid is the best company in the world at helping the electrical contractor and not asking for anything in return.

    They do offer the best electrical estimating software and on line electrical estimating classes but more than that they offer lots of free information. Giving back is Best Bid’s motto.