Inaccurate estimations can cause drawbacks in the process of important projects. An electrical contractor who ends up buying more materials than is truly needed, for example, might waste a lot of money. And, inversely, an electrical contractor who purchases less than the job requires might miss lower prices offered by wholesale arrangements, and waste time procuring all the necessary items for the completion of the project.

2015_OCT_ALL_MONEY - How to avoid estimating mistaks for large projects

Needless to say, estimation mistakes should be avoided, especially if a business is to maintain its competitiveness in a fiercely competitive electrical industry.

The question, then, for many electrical services business is this: How can human error be minimised or eliminated when developing a project estimate?

Eliminate surprise costs

One way to minimise human error is to create a document, such as a checklist or questionnaire, which covers the small and big components of each project. By listing all the project requirements in one document, the expenses that need to be addressed become clear. This eliminates unknown variables (and therefore surprise costs), making the estimate more accurate and transparent.

Have a follow-up system

Another smart strategy is to have a follow-up system; this will determine the accuracy of the information already provided by the clients, as clients often present the wrong information. Personally seeing the scale of the project (the equipment to be used as well as other variables), and then comparing your findings with the data provided, will allow you to carry out the necessary adjustments before anything is purchased, or before the project actually commences.

Use outside resources

Using outside resources is also helpful, especially in verifying the prices of materials, labour costs, and many other related expenses. Product prices are now available online, and easy access to the work rates of similar companies is also available.

Project management software

Using advanced technology is an extremely effective method for avoiding estimation mistakes. Digital programs can organise all information regarding the project, and even confirm that tasks will be covered according to specified dates. Nowadays, many types of project management software can store a bounty of information; they can accommodate adjustments requested by clients, record these requests, and make sure that the changes can be seen immediately by the right people. Because of all the information that project management software can store, contractors can have reliable references for costing according to the project scale.

Estimation blunders can be effectively avoided. The key is to be meticulous and, at the same time, make use of available management solutions that not only automate processes but also store valuable information for future use.

Erin Haywood SimPRO

By integrating every aspect of your business, simPRO allows you to easily identify the who, what, where, when and how-much of any job. Get your work done on time and get paid on time. simPRO job management software helps simplify your processes and improve your bottom line.