What Is The Right Price?
The Right Price
The pricing of building restoration work is more of an art than a science. An accurate estimate and proposal is critical to both the contractor and owner. Under bidding of projects will result in a very low Bid - Hit ratio. This would seem to work to the owners advantage but unfortunately the opposite result is more likely.
- In the short term the under bidding contractor might start to cut corners, realizing the project is unprofitable. Unless the owner has engaged a building facade professional to perform regular inspections of the work, it is up to the integrity of the contractor to perform the proper repairs.
- In the long term, under bidding contractors have a tendency of going out of business. Any warranties on the work will most likely be useless at that point in time. Material manufacturer warranties will also be effected, over 90% of material failure are due to application problems (the contractor)
A contractor that experiences a very high Bid-Hit ratio is bidding very high number of projects and landing very few. Most often this contractor maintains a large rotating stable of salespersons and a large advertising budget. This contractor will prey on the uninformed and overcharge the owner.
"When asked what they think a good bid-hit ratio is, contactors cite everything from one to one (one contract awarded for every bid) to 35 to one (one contract awarded for every 35 bids submitted). In fact, according to industry reports, the average ratio for general contractors pursuing public works projects falls between six to one and 10 to one. For private bid work, the actual ratio is about five to one, and for negotiated work is about three to one." ENR 2010.
J.S. Goray, Inc. is very diligent in our pricing and tracking our Bid - Hit ratio, our projects are a blend of both negotiated and bid private projects.
Year Bid - Hit
- 2012 - 4.4 : 1
- 2013 - 4.4 : 1
- 2014 - 3.3 : 1
- 2015 - 4.0 : 1
- 2016 - 3.5 - 1