# always seems I under-BID myself



## sawdustsux (Dec 10, 2012)

I recently (in process) have a built-in project for a customer. He asked for a built-in media cabinet, below his TV, in a opening on wall. He wished to use all the rough lumber he had from an Oak tree from his property.
It is good dried wood, and I haven't had any issues milling it. The deal was I would use all his lumber; inside/out. NO Ply for the cabinet, solid glued panels…all.
I had to do a lot of glue-up panels for a (inside of a closet) cabinet that I would have normally used Ply for.
See pics: the face frame I used the best Quartersawn, the entire panels for the hidden inside closet cabinet is all glued-up panels (labor extensive) solid Oak. I realize I have probably agreed to a "one-way" deal with him…i.e. in his favor, but I hadn't had any work for some time, and took the job for a low price, like desperation.
When I stated my bid…He was very surprised it would cost that much, I knew right away I wouldn't get anymore.
I NEEDED the job, so I took it.
I already have 36 hours; including visit for estimate, design, cut-list, etc…If I calculate 36 hrs x a mere $30 per hr I am at $1080, and not even close to done.
I ordered hinges, door mag's, media grommets, a rear vent, knobs, finish (Arm-R-Seal), Rattan Caning for the door panels, 1/4" Oak Ply for the rear door panels, more--+ $200.
I only got $900 for the entire job, including install.
I am beside myself, I feel like I robbed "ME".
Too late…but, when I said at the meeting for estimate that it would be around $1000. even though he had all his own Oak wood, he seemed as though I was way too high of a price. I agreed to $900.


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## pintodeluxe (Sep 12, 2010)

For the current job, just take solace that you are doing the job right. Lesson learned for the next bid.


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## sawdustsux (Dec 10, 2012)

Since I started building custom furniture for others I thought I could make a decent profit…I assumed the quality would justify the cost. Nobody is willing to pay for this craftsmanship anymore.
I was hoping to find the few that would want it…but, these customers, there just not out there.


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## tomd (Jan 29, 2008)

A lesson learned the hard way done it myself. If there is not a really good profit to be made walk away.


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## JAAune (Jan 22, 2012)

It is possible to earn a good living but the hard truth is that starting up any business takes years to generate a profit. Most businessmen assume 5 years average before turning a profit. That's 5 years of hard, poorly paid work with no guarantee of success. During those five years, assume any income will need to be reinvested in infrastructure, tools and marketing.

To make a good income, you have to supply a market where the demand is higher than the supply or you have to become one of the minority that does it better, faster or cheaper than the rest. Pick two because you can't be good, fast and cheap.

If you're in a position where you're dropping your price to get a job then you need to work on lead generation so you're constantly giving quotes. After being in operation for over 3 years I'm just getting to the point where I can afford to lose most of the jobs I bid and still have enough work. That's because I have a group of repeat clients that will give me work every month. On average I gain just one or two high value clients each year.


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## sawdustsux (Dec 10, 2012)

I am the little guy… the one man guy, taking any; everything to make a buck…how do I try to be fair, but true to my hard work & self/? Is there such a thing?
How do I bid 3 + jobs per month, but get what I deserve as a small shop…a really small shop.


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## JAAune (Jan 22, 2012)

There's no short answer as it varies for everyone. Find your niche and get super good at it. I know that's a vague response but I can't offer much more than that. I have two niches myself. I do church furniture and commercial piece work.

If you want to make good money, I'd suggest finding something to build that's not furniture. Your shop isn't scaled enough to put out furniture or cabinetry fast enough to earn what you're hoping to get. You're competing against a lot of retirees with the same shop you have and they are all happy earning $15 an hour. The shops earning $50 an hour or more have $250,000+ in equipment and are kicking those jobs out the door every day.

If you aren't happy with $15-$20 an hour then you'll need to figure some smaller product that you can produce rapidly in that small space. The other alternative is to slow down and slowly build up a reputation with the wealthy portion of the population and have a goal of building for them in 5-10 years.

Not the answer you want to hear but that's how it works. I took the long approach and it's paying off for me. Others went into small, niche products and turned profitable in just 2-3 years and are probably earning 6 figure incomes.


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## cabmaker (Sep 16, 2010)

Steve i mean no disrespect….just reality.

Don't think people are not willing to pay for quality these days….they are.

One rule in the millwork business…... the customer is not always right.

Your pics appear to be of marketable quality work but if you actually have 36 hours in it as stated….dont step out on the fast track…you will be squashed.
JB


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## tomsteve (Jan 23, 2015)

one thing i do when estimating custom work is figure material cost and add 15%. that doesnt change.
then figure labor and add 20%. that gives me some negotiation room.
IF materials come in under my estimate i will deduct that from final cost as i dont feel right charging for materials not used.
but i will NOT undercut my labor. i dont have a problem with people getting estimates elsewhere. when i took work and didnt earn my deserved labor price for the skills i have aquired over the years, i dint enjoy working on the project.
i dont do woodworking to not enjoy it.
its taken a while-and many mistakes- for me to learn how to estimate projects and im still refining.

there is a customer base out there that can appreciate quality craftsmanship. it takes time,patience, faith, and work to get them.


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## bearkatwood (Aug 19, 2015)

Like Bob said "Stop It!" 
Cu yourself some slack. I have paid people to work for them in the past. Good bidding on jobs will come with practice and even then you are always going to have the jobs that don't go the way you want. Sorry to hear you had a low bid job, it will get better. I like to count up my materials and then at least double the cost, that way when I get half down, even if the job goes sideways the materials are covered.
All the best.


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## Picklehead (Feb 12, 2013)

From the peanut gallery, not a contractor:

Your bid should be a price that makes you happy if you get it, and happy if you DON'T. Same as bidding on Ebay. Bid so you won't be sorry you won.


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## a1Jim (Aug 9, 2008)

I'm pretty much in tune with most of the folks that posted in particular JAjune and Cabmaker.
Woodworking as a business is a tough business and underbidding is part of the learning process and part of your education as a business person. Let's look at what you gained by taking this job: You learned that bidding can be one of the most important part of any job,so take lots of time and bid each part of the job,never give a on the spot bid. bid very heavy on each category ,the time,the material and then add a miscellaneous amount to your bid say at least 10% .
What else did you gain ? you gained a project to add to your portfolio and even though this is a low-profit job perhaps a customer that will recommend you . Like others have said it takes time and experience to become profitable in any business. Keep on keeping on.


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## sawdustsux (Dec 10, 2012)

Thanks to all..

I get it/


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## mojapitt (Dec 31, 2011)

I think most of us have had to eat a couple of those jobs. You learn quickly to be better at bidding.

I believe that people want quality. The ones that say I am too expensive weren't going to buy anyway. I don't build for Walmart, I build for them. Master your presentation. Quality and being unique to them sells big for me.


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## bigblockyeti (Sep 9, 2013)

I've had to eat a couple jobs, getting to know your customer, what they like, and most importantly (and possibly the most difficult) what they're willing to spend can help tremendously in how (or whether or not to) bid a job. Figure out what the market will support in your area and stick to your guns. If someone is looking for something extensive that will take 50-100hrs. to complete and rolls up in an 87' Celebrity, make sure you're on the same page as them in terms of what's expected from them and to them from you. Always give a rough rendering, even if nothing more than a short description with dimensions and ALWAYS get a deposit of at least 50% down.


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## bondogaposis (Dec 18, 2011)

It's a loss sure, but perhaps it covered some of your fixed costs that otherwise would have been worse if you had been completely idle during that time. Hopefully it will lead to a more lucrative work in the future.


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## kelvancra (May 4, 2010)

I was lucky. I started generating a profit from the get go. The reason was:

I took the handyman approach. That is, I did not depend wholly on woodwork. I bought tools at every opportunity, but they were not limited to table saws, miters, routers and so on. Instead, I amassed a nice collection of painter poles, a quality (used) airless and a new [quality] HVLP. I bought commercial levels (including a self leveling rotary laser from a pawn shop for $150), a used pressure washer, ladders electric hand planes, siding sanders and so on.

With these, I made enough money to assemble the shop I have today, not too many years later. It's equipped with a Unisaw, Powermatic band saw, drum and disk sander, 8" spiral jointer, an impressive grinding and polishing section and on and on. I can even tackle light granite routering and polishing. If on a roof, I have high end safety harnesses and I even have Goretex rain gear, just for pressure washing.

Now, all I do is woodwork, unless I want to take a job. Even then, I'm selective (unless the wife wants it, of course).

The simple of it was, people ALWAYS need something repaired or maintained. Pressure washing roofs, sidewalks, fences and houses with a 4000 PSI, four gallon per minute washer can pay well. More than once I bid a job and walked off, done, at one fifty an hour (people will pay more through a bid than they will by the hour).

Having my own airless (bought used for six hundred) meant I didn't have to rent one for one hundred a day. One job, alone, justified buying five gallon texture machine, which I've used on many jobs since.

Then there is the fact jobs lead to jobs. I took got a bid on the interior of the oldest Queen Ann in Olympia, Washington. The door trim and such was that wonderful stuff you find in nice homes. Pieces of it were damaged, so I took it upon myself to match it and replace it, without a word, before painting it. The owners were elated and this led to jobs.

When the contractors sat around wondering how to patch the cedar floor, where a register had been, I bid it. When done, no one knew where the patch was. I was able to cut the boards at random lengths to each other using my Fine Tool, on 2x centers. Again, this got me more jobs.

When people tried to beat me down to 501c status, I passed. Those people think you little more than a slave and value only their own time and such. So don't waste yours. Put yourself in a position you don't have to be in that position.

Since you're in woodwork, there is much you know, beyond the AVERAGE handyman. Learn even more about finishes and such. For example, today, I would only take a job like you describe if the owner signed an agreement about splitting and shifting of the wood over time (okay, one of the jobs I did forty years ago was a solid oak, suspended ceiling cabinet, so we've all been there) and understood why plywood was a better material for much of the construction.

In the end, remember, he's not going to get the job he wants, unless you do it. He doesn't have the knowledge, ore the experience and, again, you are not a non-profit corporation.


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## kelvancra (May 4, 2010)

Oh, and like bigblock, I, always, required material deposit or about fifty percent down. As a fellow contractor put it, if you can't afford to pay me now, why would I believe you could later?


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## kelvancra (May 4, 2010)

On bidding, it's as much an art as it is a science. It's harder and easier at the get go. The easy is, you were going to do many of the things you do anyway, as a hobby, so you can take a bullet or two. The hard part is figuring how much you need to replace sandpaper, bits, blades and so forth, how much to cover materials, how much to cover shop costs and how much to make a profit that both covers your private life and allows you to grow.

I never went the way of the pro's with their impressive formulas. I figured the things mentioned, then developed that gut instinct needed for such things. Again, keep in mind, people will pay you seventy an hour by way of a bid, but they will not just pay you seventy an hour.

Learning your craft and sharing secrets of the trade got me more customers than anything. I bid an attorneys deck finish at about three k. He was shocked and pointed out the other guy bid fifteen. I pointed out the other guy was probably only going to use five gallons, where I was using thirty (penetrating finish) and would share the formulas and techniques. I got the bid and was done, all by myself, in two days.


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## waho6o9 (May 6, 2011)

"so I took it upon myself to match it and replace it, without a word, before painting it."

That alone will pay dividends down the road ^^ 

'Great thread


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## JAAune (Jan 22, 2012)

Kelly's posts remind me that I usually raise my price if a customer wants to supply the wood. They may think they are saving money by doing so but I can usually get higher quality wood at better prices through my own sources. Customer-supplied wood is usually too thin, too warped, too knotty, and so on.

That runs off the cheapo-mart crowd right away.


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## sawdustsux (Dec 10, 2012)

I too, always get 50% deposit, every project.

This was the first customer that wished to use the Oak lumber that he had sawn from a tree on the property.
I wasn't thrilled about it, because like u said, it was warped, cupped, severely checked…luckily it was all 4/4 rough, so I wrestled it all, and got through, ha.

I would have never built a interior hidden cabinet out of solid Oak panels, but I did it for them.
This project has a interior (in a closet) solid Oak cabinet…way overkill. I would be done by now if I had been using Oak Ply for the carcass.

I am just about finished with all the components, ready for assembly.
I may have complained a bit too much on this thread about my woe's on the build…but, I should have charged $1500. instead of $900.

Lesson learned. All the replies have been greatly appreciated…Thanks ALL!!

Peace~


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## kelvancra (May 4, 2010)

I took a twenty year vacation from woodwork helping people with administrative law battles against agencies that liked to make rules up as they went along. Usually, those who got to me had already been so victimized by "their" government, they were limited on funds. In short, it was more pro bono work than limousine work. Finally, I decided it was time to focus on me, so, as I mentioned above, I dove into woodwork full time by way of handyman work.

My first job was painting a three thousand square foot home. It was caulked, back-rolled and back-brushed for a nine hundred dollar bid. Paint and materials were supplied by the owner. I was done in four days. Not bad. Still, I was a bit ticked at myself because no one gets a paint job like that for nine hundred. Fifteen hundred would have been a bargain. Twenty-five would have been the norm. In short, I left a lot of money on the table.

That said, it didn't take long to get over the loss, once I started focusing on what I learned. For example, I could make three or four hundred a day.

I learned I had to sell smarter. I figured I'd have to explain to people who balked at my bid, if they did, why I was worth it. That included whether or not they wanted a guarantee (I gave five, rather than the usual three, after all, how many are really going to go south and, even then, how many are really going to call back on it (it worked for Midas)?).

I learned to do things like, explain to the customer why they did not have to paint their entire house as often as recommended, if they weren't changing the color. For example, the west side was the first to fail, so it should be touched up every five years. The south might go a year or two longer. The east a bit more yet and the north could go ten years, because it took no real weather or sun hits.I

I learned getting all my bids meant I was too low. Of course, losing all of them meant I was too high.

In short, those kinds of losses were gold. It just took some time to figure it out, some times.


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