Table of Contents
- How a Flooring Estimator Determines the Installation Cost of a New Floor
- What’s Involved in Estimating the Material Cost of a New Floor
- The Right Stuff: How Labor Costs Impact the Cost of a New Floor
- Other Expenses: Prep Work, Rentals and Other Miscellaneous Costs
- Adding in Everything Else: Overhead Costs
- In It to Go Far: Including Profitability in Your Flooring Estimate
- How Flooring Estimator Services Help You Spend More Time on the Job
How Much Does It Cost to Install A Floor?
As any flooring estimator can tell you, there can be a huge difference in the cost of installing a new floor, whether it’s as part of an addition or simply to replace an aging floor. With vast differences in the cost of materials and installation, quoting an exact price per square foot can be difficult, but tends to range from $6.05 per square foot for economy laminate flooring to $14.63 per square foot for three-in-one luxury flooring. In stepping up to hardwood flooring, the change in material costs run between $3 and $10 per square foot, with the cost of installation adding to that figure to bring it to between $10,90 and $27.87.
Carpet tends to run between $4.78 and $13.36 per square foot, depending on the quality and area of the country. Vinyl can run between $2,00 for inexpensive vinyl tiles and $10.00 for luxury vinyl planking. Ceramic or stone tile will run between $2.25 per square foot for Grade 1 travertine tile up to $30 a square foot for Grade 3 granite tile. These costs do not include additional preparation work, building up the subflooring for a change from vinyl to ceramic tile or similar extra work. For an entirely new floor on an addition, flooring tends to run between $9 to $31.50 per square foot, including the slab, subflooring, and all prep work required.
Though these figures give you an excellent estimate on what national averages tend to run based on the quality of the materials, they don’t tell you how to make an accurate estimate of flooring installation costs including specific materials, labor, and factors that are specific to that project. This guide will go into all of the areas that will require some fine-tuning on your estimates to help you determine the true cost of your next flooring project, including ways for you to save time, allowing you to spend more time in the field making money and less time in the office spinning your wheels.
How a Flooring Estimator Determines the Installation Cost of a New Floor
What’s Involved in Estimating the Material Cost of a New Floor
Let’s start by looking at the range of materials that are available with flooring. Depending on the look, purpose, and durability of the material, a number of different options are available. Kitchens, bathrooms, breakrooms, pool surrounds, and entryways may be a good option for hard tile or vinyl surfaces, which are waterproof and deliver superior durability. For living rooms, meeting rooms, bedrooms, and similar areas, carpet, hardwood, or laminate flooring may provide a good option. Depending on what your client wants you to use, you may see a drastic difference in the overall cost of the materials, where a low-grade travertine floor would be much less expensive than a marble or granite floor of a higher grade.
Once your customer has selected a type of flooring, quality must be taken into account as the estimate is prepared. Some customers will be on a tight budget and demand that only the lowest-cost materials be used. It should be pointed out as part of your customer education that these materials may not last as long and could need replacing within a few years. Other customers will focus on the longevity of the materials or the overall quality of the products, especially when adding luxury touches to a home or making a long-term investment that they want to last for many years to decades.
How fluid are prices in that specific type of flooring? Following natural disasters and during construction booms, it’s not unusual for prices to increase rapidly. Specifically, in the case of a natural disaster, production facilities may also be damaged, impacting the market by decreasing supply when demand is about to increase. Locking in prices with suppliers or getting a guarantee if prices increase can help you stay on top of these variable costs.
The Right Stuff: How Labor Costs Impact the Cost of a New Floor
What kind of people make up your crew? Hiring laborers with the right stuff can make a huge impact on the project’s overall labor costs, the efficiency with which it’s run, and how profitable the job is in the long run. An inexperienced worker may accidentally scuff or scratch the flooring, which will often take longer to finish a task, leading to a higher overall cost or make inefficient use of materials, increasing the material cost of the job. At the same time, even though you’re often paying more to an experienced crew member, they’ll also know how to keep an eye out for ways to reuse waste material, will complete tasks in a more timely and therefore less expensive fashion and are less likely to damage the flooring during handling or installation, lowering extra expenses on the project.
During building booms and, as mentioned above, following natural disasters, the demand for labor goes up, so you may expect to have to pay more for workers during this timeframe. After major disasters, labor costs can increase by around 10%, possibly more for experienced laborers, though this may also include overtime costs for some workers. What about your region? If you’re currently in a boom cycle, you could consider recruiting workers from regions that are in poor shape economically to meet your needs at a lower cost. If you’re dealing with a fast-track project or other high-priority job, you may want to add in a cushion to help cover overtime expenses in case they are needful.
What about the type of project? Does it require union labor? Will you need to make additional allowances for union requirements? Knowing these aspects of the project ahead of time ensures that you won’t have any nasty surprises that can eat into your profit margin once the project has started. Do you have problem employees that tend to cause drama, slack off on the job or cause damage out of spite? If you do, either be willing to replace them if possible or add the potential extra cost of these employees’ issues into the estimate.
Other Expenses: Prep Work, Rentals and Other Miscellaneous Costs
One aspect that many contractors fail to take into consideration when estimating a project is the other miscellaneous costs that are directly associated with that project. Do you need to get and pay for permits for the project? What about the extra prep work, such as adding additional subflooring and cement board for the upgrade from a vinyl bathroom floor to a granite tile floor? Do you need to add insurance to your policy to cover a high-profile project? There are a number of other expenses that can eat into your profit margin if you fail to account for them in your estimate.
As an example, you’re working a fast-track project laying down hardwood floors. Because it’s on a faster turnaround time than usual, you’ll need to rent another flooring nailer or two in order to get the job done on time. Did you include the cost of the rental in your estimate? Have you included the additional cost of overtime hours into your estimate? What about specialty tools for the type of flooring? Will you have to work after a drywall crew that is notorious for working slowly? Taking these aspects into account when estimating your project can make a big difference in your overall profitability.
What about other compensation for your crew during a big or long project? Bringing in lunch or dinner helps keep everyone going and brightens the day, but it can also eat into your profitability. Does your crew need more PPE because of pandemic restrictions? Though many of these expenses are low individually, they can add up to a big chunk of change, possibly several thousand dollars. This can remove any profit that you’ve built into the project. Make sure that you’re including a cushion to cover expenses such as these in your estimate.
Adding in Everything Else: Overhead Costs
Many contractors are a little fuzzy on what exactly is considered an overhead expense, but it’s essentially everything you need to keep your company operating whether or not you have jobs. This can include the cost of estimating projects, union dues, utility payments, rent or a mortgage, office staff, computer expenses, vehicle payments, insurance, repair, or replacement of tools used across many projects and many others. What about a marketing agency to keep contacts coming in? An IT subscription for software? All of these items add up to your overhead expenses.
Though you can restrict some of the expenses during a slow economy, some of them can’t be entirely removed without closing the company down. If you don’t have a truck to haul materials, tools, and your crew, how will you transport these? Can you stay on top of incoming calls while working on a project? Are you able to keep up with your bookkeeping without someone to help? How will you find out about new jobs without that subscription or membership?
You’ll want to keep overhead expenses low so that the expenses don’t cut into your profit margin, but without losing productivity due to the changes. If you ask employees to bring their own refreshments to cut costs, how will they respond? Can you estimate new jobs without a team to handle the process? If you put off tool or vehicle repairs, will it be more expensive to fix them later on? You need to find the right balance point between running your business efficiently and doing damage by not spending the funds to keep up with necessary expenses.
In It to Go Far: Including Profitability in Your Flooring Estimate
Though it’s easy to focus on bidding a job as low as possible to ensure you’re keeping your crew busy, it’s important to remember that you got into business to live a little better and be your own boss. Including a solid profit margin in your flooring estimator process is part of making that happen. You started your business on a dream, that you could provide for yourself or your family in a better way than you could otherwise. If you don’t include a profit margin in your flooring projects, you won’t be able to make progress on those dreams. Create solid goals for your year, determine how you’ll make them happen, and break them down into quarterly, monthly, weekly, and daily tasks to check off. Do you want to increase your business income by 10% this year? You’ll either need to win more jobs or increase your prices. That can be broken down into a commitment to bidding more jobs every week or building your brand to make your company look worthy of the extra expense.
You’ve got a lot of different priorities as a business owner to keep your company moving. It means long hours working on strategies to grow your business, quite often unbilled. You can enjoy the fruits of your labor at the end of the year through business profits, capital gains, or a good payout. This allows you to reinvest in your company, save cash against the next bust cycle, pay for your kid’s college or look at your retirement options such as traveling the world or just spending time spoiling your grandkids.
Failing to add a profit margin is a formula for disaster. The first time your client is not happy with the work, the first time an employee causes accidental damage with a vehicle, the first time the economy takes a downturn, the first time the materials are damaged to the point of being unusable: all of these factors can quickly move you from a small accidental profit on projects to being in debt. When you have profit margins in place during boom cycles, you’ll be able to take projects that keep your workers employed but have a lower profit margin during the bust cycles. This allows you to have enough spare padding to take advantage of a great deal on materials, pay your overhead expenses while it’s quiet or buy out a competitor.
How Flooring Estimator Services Help You Spend More Time on the Job
As mentioned above, overhead includes the time that you spend in your office acting as a flooring estimator to bring in potential future projects to your company. This eats into your profitability. Though you need to keep your business competitive to stay in business, you don’t have to give up your profitability to do so. Though many flooring companies have moved to estimating software that helps them increase the number of projects they bid and lowers their overhead, this approach requires that you spend unpaid time learning how to use the software or paying an employee for their time to do so. At the same time, the software may not capture the nuances of the project, including errors in measurement, real-world complexities that will create a higher labor cost or jobsite issues such as material damage, installation mistakes, or construction delays.
Even if the computer could handle all of these nuances, just uploading the job plans won’t meet your needs. It may miss vital factors in the project, such as spending a lot of time in a freight elevator to the top of a skyscraper while you’re moving materials, the expertise and material losses in cutting exact curves in a dramatic installation or the cost of renting a flooring nailer on a fast-track project to keep your crew getting a new floor down fast. Estimating software only looks at time and materials, then allows you to provide overhead costs and profitability, so only relying on that form of estimating can churn through any profits if the issues aren’t caught before your estimate is sent. As an experienced flooring estimator, you’ve gained a strong understanding of the many factors that tie into your project costs, which ensures you’re giving your clients a solid estimate of the project costs. But even with the best estimating software, you’ll spend time working on estimates in your office, which costs your business money, instead of working in the field, which improves your profitability. Fortunately, there’s a way you can decrease the expense of estimating projects while increasing the number of projects being bid. When you work with 1build, you’ll receive solid construction estimating services that combine the speed of artificial intelligence with human experience on how the flooring industry operates. Upload your plans to our website, chat with us on the phone while you’re on the way to a job so we’ll understand your needs, then get your estimate with insider information on how to make sure your flooring company is selected for the project. Why not take a few minutes to request a demo? You’ll discover just how effective your estimating process can be.