As the construction industry is starting to breathe again, I’m getting calls from small contractors asking if I think they should hire a full-time estimator. It’s a great question, and I’m glad they are thinking ahead, but there is no simple answer. In these tough economic times, adding another serious expense to your business is not easy—especially one that involves payroll, taxes, health insurance, a cell phone, a computer and all the other costs required by a full-time employee.
So I immediately respond with a couple questions: Where do you want your company to be this time next year, and how are you preparing to get there?
What does your business plan say?
You have an estimating department outlined in your business plan, right? I keep asking this question, and so should you. It is vital to follow a solid, well-structured business plan. An estimating department is one of the most vital business tools a contractor has, and you should plan for one, regardless of what your bank account says you can afford.
Financing may sound like a crazy idea these days, but it’s certainly not out of the question. Perhaps it is the only way you can build your much-needed estimating department? It’s not like you are financing a boat or a sports car. This would be a serious investment toward growing your company with an extremely valuable and needed resource.
Look at it this way: if you are already financing elements of your business, what steps are you taking to ensure you can pay for them? If adding an estimator will help your company land more contracts, it stands to reason that hiring one would only strengthen your ability to pay your current business debts.
It’s an employer’s market
As much as I hate to write this (and I’m sure estimators don’t want me to), now would be the perfect time to hire your next full-time estimator. Jobs are scarce, and times are tough. There are experienced estimators out there looking for good jobs. Perhaps some will entertain a lower salary than they once had. Maybe some are interested in a more flexible, part-time, “lifestyle-based” position—one that doesn’t require them to work 55 or more hours per week and the weekend.
If a senior estimator is too expensive or more than you need right now, maybe you can find an associate-level estimator (2–5 years experience) who also knows how to use CAD and building information modeling technology. Or, hire a young, smart, eager junior estimator or maybe two. You may find this more affordable than hiring one senior, and you get twice the manpower, i.e., twice the bean-counting hours.
If you hire a junior or associate-level estimator, you will need to train him or her. Who in your company is going to do this? This is a very important question you should answer before you bring any estimator on staff.
And be careful. As I’ve said before, you usually get what you pay for. If you think this is the opportunity to get a great estimator super-cheap, you may wind up with the bad end of the deal in the long run. If you hire the right estimator with the wrong package, they might not be loyal or want to stay too long.
Take one for a test drive
One way to find out if you’ve found an estimator you think is worth keeping is to take them on a test drive, so to speak, by hiring them as a 1099 contractor. I recommend giving them a fair shake, allowing them time to show you what they can do. Simply throwing them a crazy deadline or a small, two-day project will not tell the whole tale. Sure, you may find out how they do under pressure or whether they can actually count from one to 10, but there’s so much more to being a good estimator. So I would recommend at least a two-week trial or a full month—enough time to have them estimate, bid and process a few projects.
A caution here: I highly recommend securing all of your proprietary databases and bidding information. Do this both by ensuring your computer and database security protocols are in place and up-to-date, and you should have any employee or contractor, regardless of position, sign a nondisclosure agreement to protect you and your company.
Can you afford to not hire an estimator?
Who is doing your estimating now? Are you bidding enough work? Are you passing on bids because you don’t have the time to estimate them all? Are you (the owner) spending more than 50 percent of your time estimating? How is this helping you find new clients? Are you getting out there and making business happen? How is this affecting your project management and your current contracts? Are you your company’s best estimator? If so, who’s running the company?
So maybe the question you need to ask yourself isn’t “Should I hire an estimator?” but instead “How many estimators should I hire?”
SHOOK has been estimating for more than 23 years. During the past 12 years, he operated a fully staffed estimating company, TakeOff 16 Inc. He is currently focusing on writing, teaching and speaking about electrical estimating. Read his blog at stanshook.blogspot.com or contact him directly StanleyShook@gmail.com.