1,000 new jobs each week in 2016. Now that more and more systems are constructed each day, accurate proposals are an absolute key to success. Putting in the right adders is crucial to getting your prices right. If you have set up a baseline pricing structure then these 5 adders will make all the difference.
- Roof Type – The type of roof you have will impact your pricing substantially. According to an NREL benchmark study, racking material and labor make up about 7% of your total system cost and 20% of your Balance of System Costs. Doing an analysis of your different racking types and the labor that goes with them can help you create adders that account for the increased labor for tile roofs or the different attachment mechanisms for shake roofs.
- Interconnection – Interconnection has always, always been a challenge for solar. With backfeeding rules changing with almost every iteration of the NEC, having adders that account for your different possible scenarios can help make your proposal solid. Moving circuits to a new sub-panel can cost more than $500, which is 3% of your total system cost for a 5.6 kW system. New services can be even more expensive. Creating a list of those costs and adding them into a new proposal can be the difference between profitability and loss on a project.
- Travel – Underrated and such a big deal, travel is a hard adder to keep in mind and superbly important. It also greatly depends on your company’s travel policy. I recommend having an adder that gives you a daily cost for different ranges of distance. You also need to keep track of the reduction is work-hours per day a team has based on the distance they have to travel. A 30 minute trip each way could mean 7 hours of on-site work each. That means a project that should only take 5 days might take 6 because of the impact of travel. A smart approach might be to calculate the added cost of mileage based on its impact on the work-day too.
- Restroom – Ah, the time honored issue of restrooms. If a client doesn’t want the crew to go into the house to use the bathroom, then an adder needs to be included for having a restroom delivered to the site. How many days will the crew be in construction mode? What is the delivery and removal cost? These important questions need to go into your Portable Lavatory adder. I typically start with a delivery/removal base cost and then have a daily rental fee. In addition to the number of crew days on-site, I often add one or two days to account for those crazy times the crew is pulled off to another project because of unforeseen reasons.
- Lifting Equipment – How will the crew get onto the roof? Ladders are usually the solution. But what about lifting the equipment up to the roof too? I find on bigger projects that renting a boom lift or a gradall for a couple of days makes the install go faster. Just like with the restroom, I have base delivery costs and then daily adders for rental. Lifting equipment is also something that is a little harder to define when it is needed. Talking with your crew will give you a good idea. Then define those instances where it applies such as over 5 kW and a roof that is between 2 and 3 stories, or any building over 5 stories for the crane. Having a rule set and information clear and accessible will help the sales team know their bounds and provide the right equipment for the install team. Everyone wins!
As with anything, the better your proposal captures the adders, the more informed the customer will be and the less friction the install crew and project managers will experience. All of that will lead to a happy customer and more referrals. Taking these five adders and indicating them on the proposal automatically is a great example of what PVBid can do for you.
What do you think of these adders? Are there things I missed that you feel are important? Let me know by email or in the comments. We will also be at Intersolar in just a couple of months so make a point of coming to visit!