This custom kitchen earned a high bid of $35,788 submitted by a Pennsylvania shop.
Whether it’s the economy, smarter bidding, or some other factor is not certain, but prices in the 2011 CabinetMakerFDM Pricing Survey are closer together and more competitive than in previous surveys.
Since 1997, the Pricing Survey has been the only industry tool that attempts to track pricing on custom woodworking projects. The survey works by taking real jobs done by real shops and making the bidding specifications available to shops across North America who in turn can submit their own bids for comparison. It’s an attempt to achieve something close to an “apples to apples” comparison of how different shops in different areas would price the same project. But because pricing on custom work is so variable, the survey routinely in the past has provided a spectrum of pricing in which the highest bid might have been as much as six times the lowest. Not so this year.
While the 2011 bidding is still wide ranging and still reflecting broad regional representation, the bids are much closer together this year, with the highest bid on three out of the four projects only about 70 to 100 percent higher than the low bid. Check out the spreadsheets and individual analysis for each of the projects, but there are some general conclusions to be drawn. Of course, before delving into that, you need to understand the basics of the survey.
How the survey works
The concept of the survey is simple, but because of the huge variety of ways shops bid work, the execution is complex. For each project in the survey, we collect original bidding data, including specifications on materials, hardware and any special requirements. We also ask for design drawings and finished photographs. All of that material is put into a bid package that is available for free download from www.CabinetMakerFDM.com.
Volunteer shops from all across North America are invited to bid on any or all of the projects that are appropriate to their shop. We ask that shops only bid on projects they would actually do if presented the opportunity. We also ask each bidder, no matter what method they use to price the job, to provide breakouts for materials costs, shop rates, construction hours, installation rates, installation hours, finish rates and finish hours. Not all shops provide this data because they might not even keep track of these numbers, but for purposes of comparison we urge them to do so.
Finally, we ask a few questions to add to the comparison. We ask how many years the shop has been in business and whether they use software and CNC manufacturing. All of these factors have been cited in the past as possible contributors to the wide variance in bidding. Also, it’s important to understand how seriously the bidders take the survey. We always ask how much time they devote to their bidding. This year the average was 5.7 hours, but some people took as much time as 11 hours to complete their bids.
Learning from the 2011 survey
Everyone we talked to involved with the 2011 survey indicated a renewed vigor in examining their costs on past jobs to better inform pricing new work. Even shops that use such systems as pricing by the linear foot, seem to be tracking costs more and adjusting their pricing accordingly. That’s obviously a reflection of the tight economy and more competition. But it might also be a reflection of the experience level of bidders in the survey: The average bidder for all projects has been in business more than 20 years and several bidders have been doing this for more than 50 years.
Despite suggestions to the contrary, there is no correlation between pricing and the use of high technology such as software or CNC machining. There are both low and high bids from CNC shops, and even shops using the same software package will show up with dramatically different bids, high or low. Similarly, it’s interesting that construction hours don’t correlate consistently to automation either.
Estimates for construction hours and materials costs are clearly the biggest variables in the bids. Paying closer attention to record keeping in these areas will help shops to have more accurate and profitable quotes.
And finally, the survey suggests that shop rates have edged up. A shop rate of $50 an hour is about the bottom for bidders this year, while in years past there might have been a quoted rate as low as $25 an hour. The average rate is $66 to $68 per hour depending on project, and there are a few bidders with shop rates over $100. This suggests that despite downward pricing pressure from the economy, established shops are paying attention to overhead costs and making sure their shop rates – and the resulting bids -- reflect real costs.
Using the survey in your shop
Use the Pricing Survey to better inform pricing in your shop. Download the bid package from www.CabinetMakerFDM.com and bid all the projects yourself to compare your shop to the survey results. Examine the differences between your bids and the survey results to look for areas of concern such as skewed materials or construction hours estimates. If you have more than one person doing estimates in your shop, have them bid the same projects separately. Then compare results and discuss variances so that you can make sure all of your estimators are working from the same page.
And if you really want to benefit from the survey, consider contributing a project for next year. Then you’ll see how shops across the country would bid work you’ve actually done. Contact Will Sampson for more information at firstname.lastname@example.org or by phone at 203.270.0025.
1. Custom kitchen
This sleek custom kitchen features a number of interesting design details including a color contrasting island. Because of the complexity of the project, the main kitchen and island were separated in the bid proposal. There are glass doors, glass shelves, crown mouldings and light rails. There are interior features such as metal drawer systems, pullouts, a lazy susan and a false front tip-out tray. Click on the More Images tab above to see a full itemized chart of the bids.
A popular mainstream project, this kitchen attracted a good range of bids from a low of $16,320 submitted by a Missouri shop to a high of $35,788 submitted by a Pennsylvania shop. The average bid of $25,965 was only about $2,000 less than the $28,274 bid of the shop in South Carolina that actually did the job for that price in 2008. The original bidder remembers it as an especially complex project involving the remodeling of a beach home and says it required 40 to 50 hours of design time. Interestingly, the biggest variance in bidding details is in design and materials quotes.
2. Built-in project
This is a whole house built-in project that includes a bar cabinets, an entertainment center, and bedroom office cabinetry. All were done in full-overlay Eurostyle construction, but a similar look could be achieved with full-overlay, face-frame cabinets, so bidders were given the option to do it either way. Click on the More Images tab above to see a full itemized chart of the bids.
Despite garnering a dozen bids as the most popular project in the 2011 survey, this job’s highest bid of $32,022 from a shop in North Carolina was less than double the low bid of $18,000 from a shop in California. The original bidder, a shop in Missouri, did the job for $23,800, which compares favorably with the average of all bids at $25,639. Interestingly, the original bidder says if he were to do the project today, his bid would probably be $25,000 despite facing increased pricing competition in his area.
3. Alder bar
This bar project was done completely in clear finished alder, including the alder countertop. There are three mirrors in the side cabinets and 3/8-inch-thick glass shelves. The drawers were dovetailed plywood with solid alder fronts. Other details included seven alder corbels and a 53-inch turned alder post. Click on the More Images tab above to see a full itemized chart of the bids.
This is the kind of detailed custom project that typically garners a wide range of bidding in the survey, so it is no surprise that the highest bid of $26,000 from a shop in North Carolina is almost four times the $6,740 bid from a shop in Massachusetts. To be fair, the Massachusetts shop may have deleted one part of the project in its bid, but even dropping that bid, leaves the next lowest bidder a Canadian shop from Nova Scotia at $12,480. The original bid from a California shop was $13,910, more than $3,000 lower than the average of $16,676. A wide variation in materials costs is the most obvious variance between the bidders.
4. Round cherry conference table
The challenge was to build a round conference table to seat 16 people. But the challenge wasn't just the construction. The table had to be built in eight sections so it could fit in an elevator to arrive at its fourth floor office location. All solids and veneers were cherry (table tops were sequenced). Delivery and setup was a separate quote from production since it was 120 miles away from the shop. Click on the More Images tab above to see a full itemized chart of the bids.
Commercial and custom furniture projects like this typically do not attract as many bids in the survey as kitchens and residential built-ins, but this project was challenging and attractive enough to garner a good range of fairly close competitive bids. The high of $19,993 from a shop in Delaware was only about 70 percent higher than the low bid of $11,825 from a shop in North Carolina. The original shop in Indiana that did the job bid $12,561, which is about $2,500 off the bid average of $15,040. Materials costs and construction hours accounted for the biggest variance between bids. As a footnote, the original bidder is currently working on a similar project that is elliptical rather than circular, and that job is going for $41,000.
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The kitchen project featured an island with contrasting color.
The whole house built-in project included an entertainment center and many other cabinets.
A bar was also part of the built-in project, which was the most popular project in the survey.
The built-in project required cabinets throughout a house.
This alder bar earned a top bid of $26,000 in the survey, but the original shop did it for $13,910.
This challenging round conference table won a high bid of $19,993 from a shop in Delaware.
Shown during construction, the table had be made in sections for transportation and installation at a fourth-floor location.
The custom kitchen project garnered 11 bids.
A dozen shops submitted bids for the Built-in Project.
The Alder Bar project had the widest variance in bidding.
This conference table was a challenging project, and the bids reflect that.
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