ECN Forum
Posted By: Bert66 T&M job bid - 02/23/05 10:06 PM
HELP!!! I'm bidding a job for a warehouse/machineshop. The shop has several welding machines, plasma cutters, o/h cranes, etc. Pretty much your basic shop equipment. The owner wants to buy all the material which is fine as it will not tie up any of my $$$. So how should I go about bidding this as a T&M job. I personnaly have never bid a T&M job.

Any advice would be a huge help.
Bert
Posted By: hbiss Re: T&M job bid - 02/23/05 10:10 PM
The owner wants to buy all the material...

Danger, danger Will Robinson!

-Hal
Posted By: BOSSMAN Re: T&M job bid - 02/23/05 11:20 PM
The way I see it is T & M is just that time and material cut and dry but you may want to be paid as the job goes.
Posted By: Dave55 Re: T&M job bid - 02/23/05 11:40 PM
It's always good to clarify if you are working for the bid price, or on an hourly basis regardless of the end cost. You know going in that you'll be held to the bid price if your hours go higher. Be sure to list all the work with the bid so it's clear that any extras are extra.

This is usually the way a "control freak" wants to do a job...warning...WARNING!

Dave
Posted By: Active 1 Re: T&M job bid - 02/24/05 12:07 AM
It would not be T & M if the owner provided materials. More like T & BS. You think you are going to be provided with the right material? Most likely the cheapest quality. Are you going to wait while he gets the right thing? Will you provide your own misc. material instead of waiting for the owner? I would figure the time to do the job and hike up your rate 1.5 or 2 times. Just give him a total price. Then walk away.

Tom
Posted By: Dave55 Re: T&M job bid - 02/24/05 01:26 AM
I really like this person and job...-20%
I like this person and job...-10%
Normal...No add or deduct
This seems a little off...+10%
This feels wrong...+20%
There HAS to be a better job than this...+30%
Time, materials provided with bid...+++???

Dave
Posted By: Indcom Re: T&M job bid - 02/24/05 01:34 AM
Give him a flat hourly rate Example: $65.00 per hour per man. all you furnish is manpower and hand tools. You furnish any material - mark it up 200%. Keep a detail summary of work description each day and have them sign it approving time and work performed.
Provide them with this and let them mull it over. Be sure to tell them if you are waiting on material to be delivered by them - it's still $65.00 per man per hour because you can't do anything until material is on site.

Personnally, I wouldn't follow up on this after I submitted this type of proposal. Sounds like you could be opening a big can of worms here.
Posted By: Dave55 Re: T&M job bid - 02/24/05 01:39 AM
I'll let you gain from my pain...

Same type of job, but worse...the owner was going to help and "cut my time in half"...his help would best be stated as saving me no time at all, probably adding time with all the curiousity questions and cheap recessed lighting, and no-show. Basically my time was normal, or more. I worked on a Holiday to meet his schedule demands. I worked overtime on that Holiday, and he doubled the amount of outlets, along with some baseboard heat and cabinet lighting.

The bill ended up 4Xplus (double labor (plus his "help" and overtime), double project (plus)). He hit the roof and yelled at me on the phone wondering why it wasn't at the bid price (he didn't ask me to work on a Holiday, he told me all the outlets he wanted in a walk-through...etc.).

Warning...WARNING!

Dave
Posted By: Electric Eagle Re: T&M job bid - 02/24/05 04:02 AM
We don't do T&M anymore. Too many customers that don't understand it or want to take advantage. We also don't work with customer supplied materials. As others have stated, these materials will be poor quality or wrong or not there when you need them. We give a firm bid, if we can't determine a firm bid, we pass.
Posted By: Jps1006 Re: T&M job bid - 02/24/05 01:49 PM
I wouldn't necessarily run yet. You just have to finish selling the job right. As far as material goes, give him a list of stuff he can supply, basic stuff, pipe wire disconnects etc. and tell him it is impossible to give a complete down to the last fitting list. Then ask if he would rather have material left over or have you supply the little stuff. If he would rather have material left over, put in order like you are stocking the truck. Otherwise you supply all the misc. and let him get the big obvious stuff.

For the time side of it, be very clear that how long it takes is what he gets charged. Resist giving an estimate too, because as others have said he see that number as a "not to exceed" amount. If you do have to give an estimate shoot it way high and when they "what!!?? why so long long?!?!" tell him "well it could be less, lets see what it comes in at" and if they keep pushing for an estimate make clear that this not how T&M works, if he'd like a bid you can put forth the time to sit down and thoroughly figure the job, but then it will be a fixed bid. Then be clear about what is included so you can easily identify extras.

The problem is that most people like this want it both ways. If it goes long they want bid, if it goes short they want T&M, but they will wait until the job is over to make that decision.

But, on the other hand, sometimes they just need a little time and interaction to build up trust and then, because you took the time to work with them and consider (still try to avoid their way, but try to ease them away from it) doing things their way, the next thing you know, you have the run of the show over there. Good luck.
Posted By: Dnkldorf Re: T&M job bid - 02/24/05 04:03 PM
Hey Bert, you need the job?


If you don't need it, don't do it...

But if you need the work, don't shy away just yet.

Alot of variables to through into the equation here, do you know the guy?
Is his money good?

Maybe you could bid it as a "T&M" on a "not to exceed basis".
Posted By: sparky66wv Re: T&M job bid - 02/24/05 06:44 PM
T&M with a cap is simply saying to the EC:

"As long as you lose money on this, I'll be happy..."

Do one better than run.

Start the job, and about halfway through (when you have already reached the "cap"), bail on him because now it is becoming apparent that you're going to lose money.

Let's see how well his little plan works when he has to pay another EC prime rate to finish, which will require a few days just figuring out what was installed, where it went, etc.

That'll learn 'em.

Boy, I'm a mean old fart...
Posted By: Doug Scott Re: T&M job bid - 02/25/05 02:37 PM
Don't forget the material handeling cost. Where is this customer going to store this material?
Make the customer do all the running for material that they forgot. And do not forget to markup your time for making up the material list for your customer.
Posted By: nesparky Re: T&M job bid - 02/26/05 06:28 AM
Fill out a time card every day with time you go to work till you are off. My starts when I arrive at office in morning then return to office at end of work day.
Make sure that your proposal states this clearly. Be sure to let them know that time spent on something else will not be charged for and document every thing.
I do not do T&M with a not to exceed. It leads to too many arguements.
If they want to supply material add 10-15% to your labor rate. Also be sure that they understand that 2 men @ 40 hours per week = 80 man hours charged for each week. Also overtime and weekend work are charged for at premium rate.
Posted By: Electricmanscott Re: T&M job bid - 02/26/05 02:24 PM
To summarize: Don't do it! I have a headache just thinking about the headaches I would get from this job.
Posted By: Joey D Re: T&M job bid - 02/27/05 12:48 PM
To all those who mark up material,do you then have to do sales tax? My accountant thinks I do if I am reselling material at a higher cost then I paid for it.

How big of a job is it? I say price the job like you would any other job, then detuct 65% of the material cost you figured. And go with that #. Explain that when the proper material is not on site when the job is underway, you will bill additional waiting time.

[This message has been edited by Joey D (edited 02-27-2005).]
Posted By: Electric Eagle Re: T&M job bid - 02/27/05 07:15 PM
Quote
To all those who mark up material,do you then have to do sales tax? My accountant thinks I do if I am reselling material at a higher cost then I paid for it.

This is probably a state by state issue. In my state if you break out materials and labor and charge more than you paid for the material, you should collect the additional sales tax for the state. They don't enforce this with small service companies, however we avoid this by selling the job as a fixed price for materials and labor. We mark up the materials when estimating, we just don't list it out that way.
Posted By: Joey D Re: T&M job bid - 02/27/05 09:18 PM
I do the same, the mark up gets listed as labor in the end to avoid problems.
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