Estimating & proposals
What this covers
Section titled “What this covers”Before work begins, a job has to be priced — and the price has to be something you can read, question, and defend line by line.
Two objects do that work, and keeping them apart is the whole of this page:
| Object | What it is | Where it is built |
|---|---|---|
| Estimate | The priced build-up, broken out by Cost Code with markups applied | Legacy KI (Estimating) |
| Proposal | The client-facing PDF the Estimate generates the pricing for | Legacy KI, assembled and uploaded in the Admin Portal |
A Legacy KI “Proposal” is a KI Estimate. The word proposal was reused for the client-facing document, which is why the rename is one of the three worth learning properly — see section 4.1.
There is no object in KI called a quote. Older documents and older pages on this site used that word for both of the above.
How an Estimate is built
Section titled “How an Estimate is built”Lines are organised by Cost Code. Every line is classified by Cost Code — the category that separates framing from plumbing from tile. That classification is what lets the Estimate, the budget, and the eventual actual cost be compared line for line instead of as three unrelated totals. A number on a proposal can be followed all the way through the project.
Markups are applied on the build-up, and the Estimate generates the pricing PDFs that go into the proposal.
Because the Cost Code library is shared across the company, past jobs price future ones: estimating a kitchen is easier when the last four kitchens booked their costs under the same classification.
Entering margin
Section titled “Entering margin”Enter the margin directly in the margin field. Its up/down arrows have been removed. Check the entered value before saving the pricing change.
Two PDFs, and the difference matters
Section titled “Two PDFs, and the difference matters”Every Estimate generates two documents, and sending the wrong one is the mistake this section exists to prevent.
| Document | Where it goes |
|---|---|
| Proposal (No Spread) | Logged internally. Never emailed. |
| Proposal, with spreading enabled | Sent to the client. |
Spreading distributes general conditions, general requirements, supervisory labour and markup into the line items rather than showing them as separate rows. The spread version is the client-facing document. Check which one you are attaching before you send anything by hand.
Proposals email from proposals@knottyiron.com and carry a single office phone
number. That address is a leftover from the name KI used to carry; see the
FAQ. If a client replies to a
proposal and the address looks unfamiliar, that is why.
Approval and rejection
Section titled “Approval and rejection”The proposal PDF is uploaded in the Admin Portal and reaches the client in the Client Portal, where they approve it or comment on it. Multiple revisions can be uploaded until one is approved, and earlier versions stay visible to the client.
Approval is recorded as evidence. An approval carries who approved it and when. What exists afterwards is a durable record of agreement rather than a recollection of a conversation.
Rejection captures a reason. A rejection captures the client’s reason in their own words, and that reason is recorded with it. It is the input to the next revision — the difference between a proposal that is simply dead and one that gets revised into something the client will sign.
At this stage construction pricing is called a budget, not a price. The number does not become a price until the final design package at the end of Phase 3. See section 9.
What the client sees
Section titled “What the client sees”The proposal in the Client Portal: the scope, the lines that make it up, and the total. They approve or comment there, and if they reject, they give a reason.
Once approved, the proposal is what the Design Contract is written from, and its Cost Code lines are what the initial Budget Adjustment allocates against.
Related
Section titled “Related”- Contracts and change orders — what an approved proposal becomes
- Budgets and cost control — how priced lines become the cost plan
- Purchasing and vendors — the vendor side of a priced scope
- Part 2 — Objects and rules — Estimate, Proposal, Cost Code, and the financial rules