The Contractor’s Guide to Estimating a Kitchen Remodel
Remodeling
4 min read
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Sam Miller
RevOps Manager
You’re a pro, so you know: there is no such thing as an average kitchen remodel cost. Kitchens come in all shapes and sizes, and makeovers can range from minor refreshing to expansive, high-end, magazine-worthy renovations. With every project being one-of-a-kind, accurate estimating is crucial to ensure a profitable outcome. So, we created this brief guide to walk you through the process – beginning with your very first visit inside a customer’s home.
Ask for the Customer's Input
Explain the Difference Between an Estimate and a Contract
Start with a Floor Plan
Calculate Costs of Purchases
You want to make sure your estimate covers all materials and supplies that you anticipate purchasing. Kitchen remodels require a wide range of items, including cabinets, countertops, backsplash tile, appliances, paint, flooring, doors, windows, wood trim, crown molding, hardware, a sink, a faucet, lighting, electrical outlets, and air vent covers. Plus, you will have to factor in all supplies needed to complete the demolition, installation and cleanup phases.
Determine Labor Costs
Consider every aspect that will require labor hours. How much demo work is required? Do you need to complete any structural changes, such as moving ductwork, removing a soffit, or relocating doors or windows? Are you responsible for installing new flooring, or will you have a flooring retailer handle that step? Will you reface existing cabinets or install new ones? Does your design require framing, performing electrical work or reconfiguring the plumbing? Once you have a good grasp of the labor needed for each phase of the project, you can use your established price list to calculate labor costs.
Insert Your Gross Profit Margin
Gross profit margin (GPM) is the amount you add to an estimate to cover your overhead and profit. It is calculated as a percentage of project costs. According to Remodeling magazine, GPMs need to be 35% to 38% on average. However, some years are tougher than others, causing contractor margins to fluctuate. The National Association of Home Builders’ 2020 Remodelers’ Cost of Doing Business Study reported an average GPM of 30.1% in 2018. You’ll want to work with your accountant to determine the best percentage for your business
Follow These Time-Saving Tips to Streamline the Process
Use Reference Materials for Better, Faster Estimate Creation
Here are two ideas to try:
Review past estimates that you developed for other kitchen-remodel projects. Take what you learned from those previous experiences, and apply that knowledge to new projects.
Create your own internal price list for materials, supplies and labor. Then refer to that list, along with your floor plan sketch, when you calculate costs. (Note: Be sure to update your price list regularly by adjusting it to reflect current prices for materials. This is especially important when supply-chain problems are pushing prices higher.)
Use a Mobile App to Save Time, Too
The right app will help you create estimates faster and produce more accurate results. That’s a win-win scenario! For example, magicplan is an easy-to-use kitchen remodel estimate tool that allows you to create a floor-plan sketch right on your smartphone or tablet. Then the app automatically estimates needed materials, compiles material and labor costs from your integrated price list, and produces a professional-looking, accurate estimate.
Conclusion
You are an expert at breathing new life into outdated, inefficient kitchens. So, why not become an expert at estimating as well? Follow the advice above to sharpen your estimating skills, so you can make every kitchen remodel more rewarding and more profitable!
