By Steve Rizer
Austin, Texas-based Software Advice’s survey of construction professionals about their estimating practices has yielded some “surprising” preliminary results, according to Houston Neal, the company’s marketing director. In an email interview with Construction Project Controls and BIM Report, he disclosed the following early findings of the survey, which can be taken by clicking on the following link: http://software-advice.polldaddy.com/s/construction-estimating-benchmark-survey.
Software Advice asked survey participants what percent of projects they win out of all the ones they bid on. Half of the respondents indicated that they win between 11 percent and 30 percent of their bids. Twenty-two percent of the respondents said they win less than 11 percent of the time; 28 percent of respondents indicated that they win more than 30 percent of the time. Therefore, if these preliminary findings prove accurate, then 11-30 percent is the typical success rate among companies in winning bids.
The company also asked participants how often they overestimate or underestimate bids. Forty percent indicated that they overestimate bids “most of the time” or “almost all of the time.” Neal noted, “Naturally, the next question they should be considering is, ‘How many projects did I lose because of my estimate?”
The number one estimating challenge that companies reportedly face is “ensuring project profitability.” About 57 percent of survey participants cited this as a challenge. Meanwhile, 93 percent of companies reportedly agree that “maintaining organized and legible documents” either is not a challenge or just slightly challenging.
“The most surprising information so far is that 48 percent of survey respondents don’t use construction estimating software,” Neal said. “Meanwhile, improving the speed, accuracy, and profitability of bids and estimates are, overwhelmingly, the biggest estimating priorities this year. It seems like there is a misalignment here. Why are so many organizations still estimating by hand or in spreadsheets when estimating software is a proven method to solve these challenges?”
Software Advice is an online resource that presents reviews, comparisons, and guides about construction estimating software. Since the company was founded in 2005, it has assisted thousands of contractors with their software research.
Software Advice is promoting the survey on its social media networks (e.g., @ConstAdvice and Facebook.com/SoftwareAdvice). The company also has teamed up with estimating vendors Accubid, ConEst, Sage, and Maxwell Systems to promote the survey to a wider network of industry professionals.
“We hope to collect responses from all company sizes and trades, from small residential remodelers to big earthwork contractors,” Neal said.
Software Advice will use the data to create a construction estimating benchmark report, Neal explained. “Contractors will be able to use the report to compare their estimating processes and practices against industry standards." The report will be available on the Software Advice website (http://www.softwareadvice.com/construction/cost-estimating-software-comparison/) after all responses have been collected.
A large number of responses will need to be collected for the data to prove meaningful, Neal said. “So, we plan on running the survey through the month of February and maybe March. After that, we’ll compile the results, analyze the data, then publish our report. If we get a positive response, we’ll run it again next year.”