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Estimate Less Jobs to Win More Work!

George Hedley

As we grew our commercial general contracting company, we became known for providing timely and accurate conceptual estimates. Local commercial developers and real estate brokers would constantly ask us to provide cost estimates to build, remodel, add or upgrade projects. These constant requests were all great opportunities for us to work with lots of potential customers. As time went on, we got busier and busier doing these free estimates for potential clients. And as we got busier, we added two additional estimators to handle the workload, which reduced our bottom line.

Providing free construction estimates is a good marketing and sales tool that seems to attract lots of potential contracts. But eventually we realized providing free conceptual estimates was not a good use of our time or money and produced a low return on investment. Our proposal win ratio for these potential projects was less than 5 percent. Why? Lots of people kick the tires and think about buying, remodeling or constructing buildings without the funds, resources or commitment to make it happen.

Determine How You Want to do Business!

To solve this problem, estimate less jobs, win more work and improve our proposal-win ratio, we held a strategic business planning meeting with a professional construction business coach to work through and determine the customer, project and contract types we wanted to go after, target and focus on. We also stopped offering free conceptual estimates for any customers without firm commitments for projects that have good chances to get built by us as the contractor.

To get firm commitments, we insisted on meeting with decision makers to review project needs, qualifications and proposed contract terms before we agreed to do any work preparing estimates. This decision reduced our estimating workload and eliminated wasting time on dead-end projects. We also request a letter of intent to be their contractor, which outlined our preconstruction services and fees for helping them through the design process, and then building the project.

To win more work, reduce your estimating workload, increase your proposal-win ratio and get a higher return on your estimating budget, start by developing your step-by-step plan to win more contracts.

1. Determine Your Project Targets!

First, determine and write out your business development marketing and sales targets. Decide what type of projects you want to focus your marketing, sales and estimating efforts on to get the highest return. When you say yes to any project, it’s nearly impossible to become known as an expert in a specific type of work. Customers seek out the best contractors who are experts in the type of work they need done. Decide how you want to do business, and what you want to focus on and become known for.

  • Niches, expertise and specialties we target:
  • Project types we target:
2. Determine Your Customers Targets!

To increase your focus, determine the type of customers you want to go after and market to. It’s difficult to market to every potential customer, but if you choose a specific customer type or industry, you can develop a plan to penetrate that market and become the recognized best choice contractor in your area of expertise. Also, determine how you want to do business and what type of contracts you want. List out your targets:

Customer types we target:

  • One-time customers
  • Repeat customer potential
  • Loyal customer relationships with little or no competition
  • Hire low bidder against unlimited competition
  • Only hire qualified select list with expertise
  • Value performance and added services
  • Value technical or engineering requirements
  • Value performance, safety and quality control
  • Private Customers
  • Public and Government
  • Institutional and Utilities
  • Other:

Contract types we target:

  • Lump Sum
  • T & M/Cost Plus/Unit Price
  • Negotiated/G-Max
  • Design-Build

Industries or markets we target:
Specific customers we target:

3. Get Customers to Commitment!

To win more work plus improve your proposal-win ratio and bottom line, always ask for the order. When you don’t ask, the answer is no, unless you’re the lowest low bidder. Getting customers to commit to hiring your company involves a proactive aggressive strategy to inform customers you want them to commit to hiring your company.

Insist on meeting with decision makers early in the process to present your company and get firm commitments from them. When meeting with customers, make a convincing case why they should hire your company and then call for the question. The question is: What will it take for you to hire us now to be your contractor for this project? If they can’t or won’t answer, they’re likely planning to get lots of other bids from competitors, will award the contract based on the lowest price, or aren’t sure they want to commit to spending any money at this time. All of these hesitations are bad for your company.

When you meet with potential customers, ask them: Will you negotiate? What other contractors are you talking to? Who have they used as their contractor previously? What are the odds you’ll actually build this project? What is the most important criteria you have in selecting a contractor? If all else is equal, what are the chances we have to be awarded the contract? And the most important question: Will you sign a letter of intent to hire us as your contractor if you’re satisfied with our pre-construction services and help you meet your budget?

Present them with a one-page letter of intent to hire your company. In consideration of your commitment and time investment estimating, attending meetings and providing pre-construction services, you’re asking them to also commit to working with your company to build the project. Explain if they aren’t fully satisfied they can cancel their commitment for any reason including if the project final bid estimate doesn’t meet their budget.

By getting focused on how you want to do business and asking for the order in a convincing manner, you can improve your proposal-win rate, reduce your time estimating projects you’ll never get, and improve your bottom line.


George Hedley, CSP, CPBC, is a certified professional construction BIZCOACH and popular industry speaker. He helps contractors grow, make more profit, build management teams, improve field productivity, and get their businesses to work for them. Visit www.hardhatpresentations.com for more information.