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Bidding a big job, what will I need?

Posted on 2011-03-24
Medium Priority
Last Modified: 2012-05-11
I operate a local IT shop from my home. I have to bid on a commercial job requiring the following:

8 Monitors
3 Computers
4 Printers
Network Switch
Rerun Data Cable replacing cat5 with cat6
among configuration and administration of the network

What will I need to bid this job? I mean, what are some things I should do and/or look out for, advice etc?

Do I need a service contract? Examples resource...

How much markup should I charge on equipment?
Do I need to get a deposit or something up front?
Any other pricing advice or formulas such as how much to charge per foot of cable, etc.

Ive been in business for over 10 years but this is the first commercial network install that I will do and the biggest so far. So feel free to give me some advice or any other information you have that you think will help.

Since this serious business I will ask that responses be answered by experts with experience in this field. Im a small business owner bidding a job and if I get that job I need to protect myself and also do things the right way. Thanks
Question by:rbudj
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LVL 39

Accepted Solution

Aaron Tomosky earned 288 total points
ID: 35211957
I never markup equipment, too little profit. I just bill my time for research, ordering, etc...
LVL 13

Assisted Solution

kdearing earned 288 total points
ID: 35212068
Agree with aarontomosky.
But I take it a step further.

For commodity type stuff, I prefer not to buy the equipment, the client does.
I will give them the exact mfr, model, part#, where to buy, etc.

There are several reasons for this:
    1, I don't want to put out thousands of dollars and then wait for the client to pay
    2. No messing with shipping, tax, etc.
    3. I don't have to deal with warranty issues

I usually give my clients a choice, but I tell them up front that if I buy the stuff I will mark it up 10-15%.
Most chose to save the money and buy it themselves.
If they decide they want you to buy, try to get a deposit that will cover your material cost.

That being said, you should definitely add in to your bid for research, etc.

If you're not a cable guy, get a good subcontractor to do the cabling for you.

The following are easy to forget when creating your proposal:
Patch cables
USB cables
UPS's and/or surge protectors
Make sure the PCs have the pro or business version of Windows
Software licenses (as needed); Office, antivirus, etc

Definitely try to get a signed service contract, that's where your true profit lies.
LVL 16

Author Comment

ID: 35212105
Wonderful information so far guys. I agree about having the customer purchase the equipment, however, I also like the up-front notice that there will be a mark up. I think this company will want me to handle the equipment. Knowing that requiring a deposit to cover materials is a common practice... This IS a common practice right? Good stuff so far.
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Assisted Solution

lancecurwensville earned 288 total points
ID: 35212118
Are they spec'ing the equipment completely (down to model number etc) or are you?  I would say if you are doing the research and such for the equipment 15% (your research time is valuable) and 10% if they have it really narrowed down.  Remember, if you sell the equipment, they will always come back to you when the inevitable hardware failure occurs even if it is warranted thru the manufacturer and it will be your time involved in fixing it.  As far as pricing for the networking, use a flat rate for all network runs, ie:  $75-$100 per drop (includes termination) it will cover the cost of the wire, termination, and your time in running the wire (not sure of the availability of IT services in your area, this may be high or low for your area).  You SHOULD have insurance, although it is not required by law (at least where I live, you'll have to check your local laws).   The jobs I have done I broke billing up into cycles, 100% payment for equipment at time of delivery.  25% of cost for networking at start, remaining 75% at completion; it made it a little more complex, but worth it especially if you are placing the items on a credit card.  Make sure that you have an agreement up front, that they sign that dictates the agreement in full, including your role and fees after the install is complete; how long you are going to warranty, how you are going to handle support, what the turn around time is for support 9x5 or 24x7.  Think about every dirty underhanded thing that people have done to you in terms of stealing your time over the years; address it in the contract.  Don't forget to include your time in setting up the computers, joining to domain/workgroup, updates, anti-virus, firewall, etc.  
LVL 27

Assisted Solution

Steve earned 568 total points
ID: 35212156
to be completely honest, this may be too much for you.
Your questions suggest you are unsure of some basic things and your EE profile seems heavily weighted towards web design.

From a business point of view, this stuff is hard. either charge enough for installation or add markup to the hardware you supply (or a mixture of both). If you price yourself too low you'll end up losing money instead of making it.
I'd recommend getting deposits because they could refuse to pay or change their mind and leave you stuck with a load of kit you cannot return.

Long term support contracts are good for regular income but only if you can support the system you provide. under a support contract you're screwed if you cannot fix any problem they get.

Cabling wise, I'd subcontract. if you haven't done much cabling before you re taking a risk by learning on your biggest customer. Bad cabling could cause problems for years and you would be responsible for fixing it.
if you know what you are doing then go for it, but make sure you over-estimate the installation time. cabling can be time consuming, particularly if it's a one man job. and MAKE SURE YOU USE A CABLE TESTER!
without knowing the size and type of building i cannot be more specific on the cabling, but its much easier if there are raised floors or fake ceilings to run your cables. if its solid walls and floorboards/concrete then your cabling may be a nightmare.

Also, why are you replacing cat5 with cat 6? are they streaming LOTS of media? do they use gigabit switches?
Unless they have a *serious* bandwidth requirement, cat 6 isn't worth the effort. and its very brittle so its very easy to snap the strand inside. cat 6 is harder to work with than cat5.

If you could provide a bit more info on the job and your experience I'd be happy to reply with more accurate information.
LVL 16

Author Comment

ID: 35212211
Thanks for the additional info guys.

The purpose of upgrading to cat6 is because I want to upgrade them to a gigabit network. I will be putting gigabit nics in the pc's. If I do this, then upgrading to cat6 is good?

I've done quite a bit of data cabling so this will not be an unfamiliar area, plus I have a friend who I will contract. He has ran the cables in Walmart and Lowes for over 10 years.

My strength is certainly web design but I'm versed in many IT areas. I WILL be subcontracting out though because of time and experience constraints. This company just needs the job done and I will get it done for them even though I subcontract.

I do have insurance. $1,000,000.00 liability so I'm covered there. Again, I'm not new at the work, just that this is my first bidded job. Most of my work has been for existing clients so it has not been a necessity for me to make an estimate with contract, supplying equipment etc.
Good info guys.
LVL 79

Assisted Solution

lrmoore earned 284 total points
ID: 35212288
I would recommend marking up hardware a minimum of 10-15% over cost, or get them to purchase direct from Dell or whoever using their business credit card or something.
Are you considering fixed price or time&material? If doing fixed price, I recommend a Scope of Work that both of you sign that spells out exactly what you are going to provide, what you are going to do, what you require them to do, what are the deliverables, what is the acceptance criteria, and what are the support options once they accept that the project is complete. We generally say that fixed price projects are billed 50% up front with the hardware, and 50% upon completion.
If the current wiring is CAT5e, tested and certified, then there is no real reason to go to CAT6.
LVL 16

Author Comment

ID: 35212331
thank you lrmoore. I'm doing an estimate so Im really not sure how to bid it. I'm thinking of a fixed estimate for the Scope of Work in addition to time and material. I'm still thinking about this one.

Concerning the Cat6, What are the advantages to cat6 over cat5? These guys want satisfaction and that satisfaction is a new network. They have given the green light on the cat6 upgrade but I want to make sure it is benificial. So upgrading to cat6 is good if I upgrade their network to gigabit?
LVL 10

Assisted Solution

Wolfhere earned 284 total points
ID: 35212371
From what I have seen, advice has touched everything but the workstations. Easy, right? 6 monitors for 3 workstations. Graphics intensive, I am assuming. Are you going to build the machines? or have them purchase pre-built? If graphics intensive, you not only will need the HD space, appropriate graphics card(s) to manage, and lots of ram, you will need the appropriate version on OS. Adobe Photoshop CS5 is 64bit native.  Home versions are not acceptable. You will at least need a scratch disk separate from your C Drive. As mentioned earlier, the software drives the hardware requirements. I know this is assuming Adobe, but if they are a GIS/CAD firm all the above applies.

Cat 5e will handle gig. Cat 6 is needed between server and switch and/or between switches (assuming they are not back planed already and in separate locations). There is no real advantage to running Cat6 if you already have Cat 5e. I agree will totallytonto.
From my experience (20+), the network is only as good as the workstations. And by workstations, I mean the OS, software and hardware AND PBKAC. I have installed, configured and managed 2500 workstations and servers, switches, and cabling, AV Security and Backup. And helped with the remaining 19,000 - all for '1' outfit. Of course PBKAC (Person Between Keyboard And Chair) is always something to consider.

I would concentrate efforts on Switches, Firewall and Workstations. There is getting specs, purchasing, installing and configuring enough for those 3. If they already have the switches and firewall.....
Cabling is expensive and if already Cat5e...un-necessary. You make your money on these. Time and material!
LVL 27

Assisted Solution

Steve earned 568 total points
ID: 35213678
check if the existing cabling is cat5 or cat 5e. if cat 5, replace with cat6.
if its cat5e i'd leave it. cat5e is capable of gigabit. the improvement in speed between cat5e and cat6 is so small you'd never notice.

Thanks for the additional info. Apologies if i made assumptions but without info I'm not suggest you go blundering in!

Sounds like youve thoght this through and you're going in the right direction.

Heres what I do:

survey the site - work out how much cable you may need. assess any difficult areas to get cables to. decide where the server/switch/patch cabinet is going. enough sockets? space for cables?
Overestimate - if you guess a particular cable woould be 10 meters, quote for 15. it's amazing how often cabling is made harder by stuff under floors etc. dont leave yourself short. also consider adding a spare cable where possible. dont just run a single cable to a particular location. if it is faulty or if they decide to plug another PC in you'll have to recable the whole thing.
Assess the spec of systems - get an idea what to sell them. dont just sell them cheap crap as it will come back and bite you. dont oversell expensive stuff or they may go elsewhere
work it out: Look at how quickly you feel you can cable the place. over estimate and be realistic. assess how much time you'd need to spend preparing the PCs before installing. allow extra time for things that go wrong.

remember, it's easy to work a bit slower to fill up your time than it is to work faster to keep within your estimates.

I'd provide a quote for the work, a quote for the kit and a quote for the cabling supplies. you can add a bit to the kit and the cabling supplies but make most of your profit from the work.
LVL 16

Author Closing Comment

ID: 35234584
All the information you guys provided is valid and useful. Thanks everyone for your help!

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