Question on bidding - REO Property Preservation Forum
 
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post #1 of 9 (permalink) Old 08-19-2013, 06:34 PM Thread Starter
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Question on bidding

First time I have ever been asked to provide a bid to demolish a home. Banks wants estimates and I have a company meeting me there in the morning for a bid. They handle everything from contacting utilities to pulling permits to grading off finished lot.

My question is what do you charge above their bid for profit 20%? Since they will be paid right away by me and I wont be probably for 30-45.
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post #2 of 9 (permalink) Old 08-19-2013, 07:10 PM
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Quote:
Originally Posted by hammerhead View Post
First time I have ever been asked to provide a bid to demolish a home. Banks wants estimates and I have a company meeting me there in the morning for a bid. They handle everything from contacting utilities to pulling permits to grading off finished lot.

My question is what do you charge above their bid for profit 20%? Since they will be paid right away by me and I wont be probably for 30-45.
Do not forward the bid from your sub contractor. Also make sure you spell out the completion time required IF the bid gets approved. Around here, it can take 30 days just to get the utilities turned off. You don't want to end up with with 48 hour rush on a bid approval like this.

It is common, for 10% Overhead and 10% Profit. Well, maybe not in this screwed up industry.



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post #3 of 9 (permalink) Old 08-19-2013, 07:39 PM
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Make sure to indemnify yourself/company above anything else.

No less than 20& profit after discount is completely reasonable.
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post #4 of 9 (permalink) Old 08-19-2013, 09:29 PM
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definitely indemnify yourself and your sub. make it known the bank is responsible for any claims that arise after you complete work they asked for.

As for profit, I'd say 20% would be in the ball park.

The other suggestions above are good ones too. Asking for an extended completion date is a must.
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post #5 of 9 (permalink) Old 08-19-2013, 10:20 PM
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Give me $10 and I will take that sucker down. Can of gas and some matches should do the trick.
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post #6 of 9 (permalink) Old 08-19-2013, 10:36 PM
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any less than 35% and the exposure is greater than the profit.

  • On average a demo will run 7-12k. You add 25% to that and you stand to make $3,000.00 on 12k.
  • you pay the demo crew up front spending 12k of your own money.
  • it takes 30-45 days to get your payment.
  • That's 100.00 a day profit with an exposure of at least 12k and a 30-45 day wait time.
  • You can pic up 2 extra grass cuts a day for 30 days and make $4,800.00 with ZERO exposure and no loss of cash flow
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post #7 of 9 (permalink) Old 08-20-2013, 04:44 AM
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If you are subbing the work to a licensed demo outfit, you won't need to know a lot of details. Just make sure the sub is licensed, insured, pulls the permits, and his bid is detailed enough for you to handle the client's questions.
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post #8 of 9 (permalink) Old 08-20-2013, 06:23 AM Thread Starter
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Quote:
Originally Posted by Craigslist Hack View Post
any less than 35% and the exposure is greater than the profit.

  • On average a demo will run 7-12k. You add 25% to that and you stand to make $3,000.00 on 12k.
  • you pay the demo crew up front spending 12k of your own money.
  • it takes 30-45 days to get your payment.
  • That's 100.00 a day profit with an exposure of at least 12k and a 30-45 day wait time.
  • You can pic up 2 extra grass cuts a day for 30 days and make $4,800.00 with ZERO exposure and no loss of cash flow
thanks CH this is what I needed to know.
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post #9 of 9 (permalink) Old 08-20-2013, 06:24 AM Thread Starter
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Give me $10 and I will take that sucker down. Can of gas and some matches should do the trick.
Dont think it will take that much. this place is pretty bad.
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