Two Common Mistakes in Estimating Paint Jobs

Paint contractors often make two important errors in relation to how to estimate painting jobs. Both of these are efforts at a short-cut, and neither will be profitable over the long term.

One mistake is to fret about the “going rate”-what others charge. To get directly to the point: Your bidding should the pricing of other contractors. Their pricing has no impact on what your price ought to be-your production rates, your expenses, and your monetary objectives are all that matter.

If other painting companies are willing to labor for less than you want to make, will that mean that you should? If your competition is clueless in regard to estimating and the price they should charge, does that mean that you ought to go along with their lead? If other painting companies are gradually going bankrupt, do you truly want to emulate them? If your reply is no, then what difference does it make what they charge?

Undoubtedly your competition has an influence on your business. If another company offers comparable service and value for half the price, the customer will probably go with the lesser price. But it is very doubtful-if not unfeasible-for a business to provide superior value at cut-rate prices.

The price you must charge for a particular project should include the following: labor costs, paint and sundry expenses, indirect costs (overhead), and profit. Every one of these can vary widely from business to business. To be anxious regarding what others are charging is to overlook these facts.

A second mistake, which is very similar to the first, is to estimate by the square foot. On the surface, this may seem plausible. Nevertheless, the square foot concerned is on the floor, rather than a paintable surface.

This form of bidding is common in new construction. It provides an easy (and I might add, lazy) approach to bid. I say this since the size of the floor has zero to do with what is being painted.

Think about the following illustration: A room that is 20’ x 20’ with an 8’ ceiling has 400 square feet of floor space. The wall area is 640 square feet. There could be 80 linear feet of baseboards and 80 feet of crown moulding. If that room were divided into 4 equal size rooms of 10’ x 10’, the wall area would double to 1,280 square feet. Similarly, baseboards and crown moulding could also double.

Regardless what you charge per square foot, the previous illustration demonstrates that the floor has hardly influence on the real work. But if you estimate according to the floor area, your price will not precisely reflect the real work to be performed.

Pricing paint projects isn’t heart surgery. But it shouldn’t be done with blind guesses, tarot cards, or Dart boards either. Numerous aspects must to be considered when pricing a job. But the size of the floor isn't one of them.

You might think, “But everybody does it this way. Surely it isn't that awful.” First, everyone doesn’t do it this way. Second, 90% of the painting contractors beginning business this year won’t be around in 5 years. So if you want to do it similar to everyone else, you are probably going to end up like everybody else-burned out, disillusioned, and bankrupt.

It is never too belated to learn proper estimating practices. And if you are just starting a painting business, now is the moment to study how to estimate paint jobs.

Zappos

I recently read about Zappos on Zig Ziglar’s blog. At first I thought this was a joke, as the company sells shoes online. The idea struck me as bizarre—I couldn’t imagine anyone buying a pair of shoes without first trying them on. But they must be doing something right, as Amazon.com recently bought Zappos for about $928 million.

From what I have read, a large part of the success of Zappos is attributed to the company being a fun place to work. Indeed, one of their “ten commandments” is “Create fun and a little weirdness”. This may seem like an odd directive, but employees embrace the atmosphere that exists at Zappos. And that is reflected in their customer service. For example, if a customer mentions having a bad day, she might find flowers on her doorstep the next morning.

Such offbeat tactics might seem silly, but they have created a growing legion of loyal customers. And that is always a good thing. Sometimes all it takes is a little imagination.

Lessons from Child Rearing

Even though I don’t have children, I find the topic of child-rearing interesting. Getting Things Done—a personal productivity site—recently had an interesting post involving children. The author was going to spend the day with his children, and involved them in planning the day.

They began by listing some of the activities they wanted to do. They then identified how long each activity would take—there is no sense in trying to cram 10 pounds of potatoes into a 5 pound sack. I won’t relate the entire story, but it turned out to be a fun day for everyone.

The lesson in the story is directly applicable to small business owners. Often, we simply dictate to our employees how things will be. After all, we are the boss and if they don’t like it… But this often gets us results different from what we want and expect. We don’t get “buy in”.

Like the parent who involved his children in planning the day, we should involve our employees in the decision making process. This doesn’t mean that we give in to whatever ideas they come up with, but it does mean that we give their ideas serious consideration. Not only are they more likely to approve of the results, and therefore implement them, there is a good chance that they will have some better ideas.

I certainly don’t mean to equate children and employees, but in a certain sense there is a similarity. In both relationships, we have the final authority. In both relationships, we are looked upon as the expert and the guiding force. We are the leader. While this requires a firm hand, it does not mean that we should be dictators.

I am familiar with parents who tell their children to do something “because I said so”. This hardly helps the child understand the rationale behind the directive. However, when the parent explains his reasons (in a manner the child can understand), the results can be much more satisfactory to all involved. The same applies to our employees.