My first exposure to material pricing was in the mid-1970s when I was promoted to pricing clerk/assistant-purchasing agent at a wholesale house. My new desk was dominated by a 4-foot wide, metal-framed collection of pages called the Biddle Book, which was furnished by Trade Service Publications. The prices were updated weekly with new pages in a packet from Trade Service. For some reason I never figured out, I hated updating those pages every week. It was not that difficult and only took about 5–15 minutes, but it was still a responsibility I resisted.
Every handwritten invoice, whether generated from a phone call or the sales counter, ended up on my desk. It was my responsibility to price the material on each invoice. For every piece of material down to the smallest screw, I had to find a price in that giant book and copy it. Next, I had to multiply each price by the quantity and calculate the total. Fortunately, the advent of inexpensive desktop calculators made me—in my humble opinion—the fastest and most accurate price clerk the company had ever seen. (Of course, there were those who would dispute that.)
The Biddle Book had several price columns, including retail, broken box pricing and Column 3, or wholesale, which was the price I used. Since this was a small wholesale house, serving mostly small contractors, it rarely offered discounts. Occasionally, a customer making a large purchase could get a 5- to 10-percent discount.
Playing with the big boys
After a few years at the wholesale house, I moved to the same position at a large electrical contractor. Wow, what a difference! Instead of 5- to 10-percent discounts, this company was getting 20- to 50-percent discounts.
The other big change was the difference in scale. Where I was taking orders for 500 feet of No. 12 THHN at the wholesale house, I was taking orders for 5,000 feet of every color at the contractor’s office. The only thing that remained the same was the pricing source. I still had that 4-foot-wide Biddle Book on my desk, and I was still applying discounts to the third-column wholesale price. I had to put up with that book for about 15 years of my career before I finally ditched it for good, thanks to digital media.
In the mid-1980s, many of the electrical estimating software companies started making arrangements with Trade Service Publications to get digital price updates for their databases. My first such updates were done with 51/4-inch floppy disks. Every week, I would receive between two and eight floppy disks in the mail. It was part of my job to take those disks to every estimating computer in the company and run the price update. It was time-consuming but much better than doing it by manual entry from the Biddle Book. Now, it’s all done over the internet.
Today’s competitive pricing
Despite all of these technological advances, getting competitive material prices into your estimate is not always as easy as it should be. You can keep your estimating database prices current by subscribing to a pricing service. I found three companies that furnish automatic price updates for most electrical estimating systems: ElectricSmarts’ NetPack, Trade Service’s Tra-Ser and Vision InfoSoft’s EPIC. Each of these companies offers a collection of services, including third-column wholesale pricing, average market or target pricing, access to manufacturer catalogs and price updating for your estimating software. They also offer a method for importing your vendor’s material pricing directly into your estimating system.
Let’s get specific about the pricing levels available from these companies. Third column, or wholesale, is the non-discounted price for materials. You probably won’t win any bids using this column. Target (or market) pricing is derived from research as to what electrical contractors actually pay for materials, and usually has a small safety cushion of a few extra percent built in.
The services that import your vendor’s pricing directly into your estimating software should be the most competitive, assuming your vendor has set up your file correctly. These services automate and replace the process of printing and sending your material list to the wholesaler for pricing and then manually inputting those prices into your estimating system. It is the best way to get the wholesaler’s lowest price into your bids. The only difficulty has been a lack of vendor participation. However, many wholesalers understand this method saves them money and are getting onboard.