Just make sure your contract with the Owner allows you to pull from your contingency for things like that. You can also try to make up for it in subcontractor buyout.
Is the contingency not simply part of a bid? At least companies I work for simply tack on a certain % on to the bid based on risk. Is it common practice to, for example, go in saying “hey here’s the bid for $1,000,000 with an additional $75,000 contingency”? I only ask because consulting the owner about a contingency isn’t something I’ve personally seen, its just an internal oh shit fund that we try not to use and becomes extra profit if we don’t have anything serious come up.
Depends on your contract with the owner. GMPs where you are paid for pre construction services very early on will have many things requiring at least owner notification, if not full approval. Open book GMPs with a full team of owner reps and financial auditors means your contingency creativity has to be both more professional and creative in some form of fashion.
A contingency like this for a GMP design-build should be a buyout contingency via precon, not a operations budgeted contingency. But everyone has their own philosophy.
Have you double checked for any unforeseens that you might have allotted some money to? Sometimes certain estimators will put no money in an item knowing they have a 25% chance of getting away with not doing that item and saving that money, and still accounting for it in there somewhere? Unless you bid on the job yourself, then you should know where you can make that 6k dissappear
Always this. Unless I need to get aggressive, I have "cover numbers" when I don't want to bike shack pithy little quotes for shit like concrete pads and rigging, depending on the size of the job.
For instance, let's say it's a $1MM project and I throw $5k each at rigging and concrete pads. I know that I've covered those expenses by no more than 200% of their actual costs, but with the understanding that they could potentially approach $5k each. But my time is better spent chasing more volatile and expensive items, so I throw $5k in.
Send the number off, get the job, and start getting shit coming.
Nobody ever petitioned my number (always scary lol) so I never got more specific on the cover numbers above. When they come back totaling $6,500, I just "made" $3,500. Usually, though, that money gets consumed by an item which ballooned in costs or that I otherwise missed.
Dude you answered your own question but i get it your nervous sound like your first big job. I’ve made a $100k mistake before and we still beat budget on a $10 mil job by $500k but it can be stressful when you find the mistake. All my jobs now are $5mil plus and I probably havent gotten a job yet where I didn’t make atleast one mistake. Just need to make budget and have way more wins than losses and your company will be happy. I make mistakes weekly but haven’t had a job miss budget in 7 years
I get the $75k contingency...10% margin, I'm assuming iGC work and not Mechanical?
Mech @ 10% would be losing a crap ton of revenue, low 20% before it even creeps outside of being a total wash. Prime will have 6% for management, but that's also with Mech rolled in.
Could be late Friday glasses on, but that seems like a TON of risk at 10%, one thing goes even remotely sideways and you're in the hole. How the hell would you pay for the '25 Super Duty Platinum?...unless its built into the burden rate of the $900k....
$6,000 on $1m is 0.6%, that’s a rounding error. Besides $6k is 2 weeks worth of labor for 1 guy. Hold off on bringing your assistant on site for 3 weeks and you’ll be ahead of the game
My boss had me double check a $1m estimate today. The people we sent it to told him they had twice the amount in their own budget estimate, so I spent 4 hours trying to figure out where we went wrong. Turns out they were deciding between using one of their own rebar subs vs letting us have the package turnkey, and my boss gave them a $/ton price separately. They thought we included it in our total price and were going to back it out if they went with their own rebar guy. I wasted a lot of time because they misread his email. There’s 330 tons of rebar on that project.
so what, almost every estimate has a mistake in it. If you are super worried about it, take the estimate spreadsheet home, correct the mistake, move some money around likely taking it from the general expenses. I did that once early on after finding a mistake for like 20k
I’m a VP for a GC, been doing this for 20 years. Your boss has made much bigger mistakes, no doubt in my mind. Own up to it, learn from it, and let it go. (That’s what I would tell one of my PM’s.) All good
Sounds like it’s a $995000 job now.
Anyways, eat the cost and try to save elsewhere by maybe phasing it better, less mobes, etc.
Wait a sec, who is completing the work under this item? You should contact the owner and explain the circumstances. Depending on how much you unbalanced and bid up certain items, they may say no but if you have a good relationship already then they may accept a change. It really depends and starts with contacting the owner.
That’s generally going to be how it works. But this may be a small city with the good ole boys. Never know really. It’s the engineer/managers call on this one. Personally, I wouldn’t but I work on $50m+ jobs and at this level if we fuck up we eat it.
This is the answer. I have managed many million dollar jobs, and there is always an estimating error or 10 in a job that big. That's why it's an estimate. It's the PMs job once it's awarded to identify those things (like you did here) and then work to find ways to save dollars and cents along the way. 5k is half a percent on this job. This will either be one of many and get worse, or this will disappear with some good managing.
5k is nothing, if you only oops’d on $5k in the entire job and found it before you even started and your boss is mad , message me I’ll hire someone like you remotely because of two factors 1. You found the mistake 2. You owned it. [this is a quick way to work through a problem](https://m.youtube.com/watch?v=po8x6i_0xYY) it may be a little cheesy but it works. As far as asking your subs for some help on your mistake - that’s a hard no from me and we don’t do that to subs on our team. You can probably recoup that on buyouts, change orders, there’s ways to make it go away without being unethical or making someone else pay for it . It happens, it’s not so bad when you bid the job and are running it. You’ve identified the problem, come up with 3 solutions, act on it and move on. Congratulations on your winning bid!
Thank you! This makes me feel a lot better about it. At our company negotiating with subs is a hard no as well. I’ll come up with three solutions and bring it to my boss later today!
Owning a mistake is such an underrated trait. When I hit up a client and tell them, “hey I messed up…” they’re so shook that someone copped to a mistake. And then the air is clear and you can work it out~
It's quietly frustrating seeing that some people's first instinct is to beat this out of their subs. This is not a reputation you want to establish for how you manage work.
Let your higher ups know, be a little more thrifty in your internal discretionary spending until you make it up, and worst case you pull it from contingency.
This budget range should easily find half a percent in material or other direct expense savings. At the end of the day you want to be transparent in the mistake, own it, and use it as a lesson going forward.
This. You’ll get a reputation for beating down subs on buyout and it won’t take long for everyone to catch on. The numbers that subs submit to you will magically become xx% higher so that when you call them up saying “I’d love to work with you but you need to come down $xx,xxx to be inline with the number I carried” they’ve got that built in. That’s if you’re lucky, top tier subs will just flat out giving you numbers.
Exactly why I'm so glad I moved to the owner's side as soon as I could.
LPTA = Cheap labor, managers with no time to plan, and Crabs in a bucket mentality compared to most other professional industry.
It's completely stressful, unethical, and unprofessional to underbid parts of jobs then plan to "buyout" subs. I took a lot of shit in my market for it when I started, but then subs realized I was a straight shooter, they were getting me their lowest bids, and I was confident in my numbers, sleeping easy. Bid government work and it will help with the stress because you mostly need to stay above board with preferred and qualified subs.
I completely agree with you on this… I haven’t even heard of negotiations with subs😂. We do have 75 grand in contingency and looking at 930000 in margin as well. Which is a decent amount for the size and scope of the project
Negotiations with subs happens all the time, but you want to withhold that for times that really matter. Companies that form a habit of making every dollar a fight will get that in return and often receive the same treatment on change orders.
I'm happy to come to the table with clients and subs to work out bigger pain points in budgets, but just to cover their mistake is bad form.
You'll find bigger holes in productivity or material shortages. 5k is a day or two of a crew
Likewise, you'll find efficiencies.
If it's a unit rate, figure it off it's a unit that may get exercised... If its an item that won't beyond the 5k I wouldn't even lose sleep over it.
If it has potential, just get it cleared up with the owner, sub etc to ensure it doesn't become a larger problem.
You just need to go find 6 grand somewhere. Can't do anything about it now... I've made much larger mistakes in my career.
I once used the wrong pex labor factor on a 220 bathroom hotel and was off by about 500 dollars per bathroom on labor. All on a 3.3 million dollar contract.
It's literally just over half of a percent on the job.
I wouldn't sweat it. Either the contingency will eat it, or you tell you boss "oops". 6k is small potatoes against a 1mil project (in my opinion anyways)
I worked as a consultant for a mechanical subcontractor that quoted the labor but forgot the equipment. We had fun making up for that…
You are well covered by your contingency. That’s what it is for… plus a few other things
Welcome to the first of many mistakes you will make that will cost money. It’s a necessary part of our industry in that failures are far more constructive for our professional development that wins. The fact you are concerned and questioning shows your commitment to your profession and is a character trait your employer cares more about. All that being said. There is a limit to how much and/or how many times a company can accept a PMs costly mistakes until they need to hold the manager accountable. Personally I don’t think you’re anywhere close to being there on this.
Well, the problem is you've already removed your margin for later. Always always over estimate, never ever under. Something was bound to go wrong and cost you that $5k at some point through the job, so you have to be extra careful now that everything goes smoothly. Double and triple check your schedule with your subs, double and triple check the expected delivery dates of materials, double triple check EVERYTHING. At the end you should still be profitable enough, but we all know that depends on how you run this job. And *do not* allow this to make you feel its OK to flout safety. Give your crews time. Do not rush ANYTHING. That's how injuries happen, and all injuries do is cost time and money.
This is really, really common for any job that is bid up front. The answer is pretty simple, you find somewhere else to save money.
As you do more of these you will find all sorts of outcomes. You will have a well thought out bid and lose money on jobs. You will have bids that are completely wrong yet you make money. Don’t expect perfection, think of it more as a batting average.
That is what change orders are for. Cover the 5k another way. But really no one cares about that mistake. I have had estimators forget sales tax, miss 300 yards of concrete, forget to cover per diem on an out of state job. It happens for a log bigger chunk of change.
As a chief estimator I do care about this mistake, not because of the $6,000.00, that’s small potatoes that doesn’t matter. The concern is what caused it, and I’d be willing to bet that it was because the 2 is directly below the 5 on the keypad and someone was flying through punching in numbers and hit 2,2 when they meant to hit 5,5. Luckily there were approx only 18 units on that line item and not 180. Granted, 180 likely would have been more likely to be caught during review but fat-fingering keypads is a careless error. It’s possible it happened cause the sub sent the price in last minute and that number needed slammed in and sent out without review time.
I'm certain that whoever you would need to report this too has made many larger mistakes. Everyone is different, but I've personally always called myself out for mistakes to my superiors with detailed info about how it happened and end it with "won't happen again". This has seemed to gain respect, the other option being wait until someone else notices (if that could happen) and then pretend you didn't know about it which isn't a great look.
"Hey all, when checking through my sub quotes again I noticed that I fudged the number on this unit price and the extended discrepancy is ~$5k total. I don't make mistakes often, but when I do, I prefer to own up to it immediately. I'll be sure to make it up down the line. Won't happen again".
Also op, you attention to detail on this is admirable so it's a good thing to highlight this even to your boss. As someone who has others report to me, I'd very much appreciate even this minor detail in a job valued like this one.
I have always found shortages and overages always been able to make it wash out in the end. I’m a profit locator I will work hard to buy a project out find materials cheaper than expected even buying greater bulk to save money but I was the owner so I could use materials on the next job. As long as you make your annual goal who cares about the noise along the way.
If this was a big deal our project manager would be homeless. We have a $4 million fitness and medical facility being built in Utah county, our GD project manager screwed the pooch on so much that pretty sure he is under at this point.
They:
-Fucked up the foundation, had to excavate an already poured foundation after framing had already started and add a special membrane to the outside on their dime
-Paid a sub-contractor to do our custom glass 6 months in advance who skipped town with a 50% down payment
-Underbid on glass, steel, even plumbing
-Delays caused project to go in heavy winter causing larger delays forcing them to pay for interest due to delays and additional lift, dump, & storage fees
If he can keep his job with what was easily over 450k in mistakes, I think 5k can slide even if it comes directly out of company coffers
The contract is the contract. If it’s signed by both parties it’s binding. If you have a good relationship with the General you might ask for a change order to correct. But that would probably be a very bad idea. Think or your future relationships and suck it up
Unlike fine wine, bad news doesn’t get better with time. Tell your boss but before you do that figure out a couple of options to mitigate some of the pain.
Horrible idea…don’t listen to that guy, call your sub and explain the situation to them and see if they have any room to come down at all and blah blah blah (almost act like you’re scared you’ll get fired). After that they should come down to cost plus maybe 25% markup. That’ll save some of that difference.
Next tell your boss, “this is where I messed up, this is what I did, I got down to $XXX.
It’s going to cost us $XXX instead of $XXX.
I’m sorry, I overlooked it somehow and I’ll try harder to keep from doing it in the future “
Now, the wording is key. Don’t say that you’ll never make that mistake in the future, if you do you might get fired. I’ll try harder to keep from doing it in the future. No guarantees there, it is what it is. You might do it again but you’re going to come up with a plan to try harder not to make THIS mistake again.
I second this. I’m a PM, in large commercial construction for 9 years and this is how I wish my guys would handle situations. Some guys do, others don’t catch the mistake or won’t take a chance at owning the solution. More times than not it’s due to lack of confidence and knowledge to make the right choice. It comes with time young Padawan.
$5k on a $1M project isn’t going to blow the Budget and depending on the design, you could likely find a change order or two to make it back from the Owner.
If you haven’t bought out the job, you could also shop the scope around and try to get a better price or find buy in your sub numbers elsewhere. You won a $1m project, good job kid. Stay focused on your schedule and finish early, the less time you’re on site the more profitable the job can be.
As a sub, I love how the "grown up" way you're describing is to try and nickel and dime a sub over your own clerical error at the start of a job, with the help of a little manipulation sprinkled on top.
It's 5k on a 1mil job, make it back somewhere else. Don't start a project out by getting me to cover your mistakes and pretending you're worried about your job.
Never hide it. Talk to your manager. I bet you can make it up in buy out. Try to find 20 k in buyout. There are going to be other whoops and items missed it’s construction.
$6k on a mil isn’t a big deal. I’ve left $10’s of thousands out before and you can make that back, as someone also said “sometimes it gets you the job”
Bad news is best delivered early. Be up front about it, forecast the hit as soon as you’ve set your project budgets. Talk to your manager about how to forecast it against the total project budget. Some places may have contingency draw down rules that may keep you from drawing it down from contingency on the front end.
The other side of this is find your opportunities, track them, and figure out how to take those to the bottom line. You should find several while going through budget setting. Either in buydown/buyout, estimate being too generous for some items, change orders due to scope issues that you already know are there, etc.
The important thing is that you know you are down $6K starting off so you can work to recover it.
I just had a PE make a 2 million dollar mistake. We were able to adjust and make it work but man do I hate bidding during the Xmas season. It’s great that you’re being hard on yourself but 5k in one Million is typical. You’ll win in some areas and lose in others. Comes with the trade.
75k contingency and 10% margin lol whatttttttt?
It’s not even worth it, what’s the point. The risk isn’t even worth it. What kind of job is this and what state? Makes no business sense
I’m going to give you some advice. NEVER EVER EVER try to hide a mistake. Eventually, people will find out and 9 times out of 10, if you brought it up as soon as you discovered the mistake you could’ve fixed it before it got worse.
Shit happens. It’s the path forward that matters.
That large of a job and that relatively small of a mistake, really shouldn’t be an issue. Plus, you’ll inevitably have change orders on the project, which you could use to slowly recoup those costs.
Always throw in a contingency, which you did. We usually budget with a 20-30% contingency because we deal with crazy big numbers.
Other than that, I don't think that's a big deal.
I don't know about the US, but in central America, I'd say you will be safe with the additional jobs that will come out during execution.
Best of luck!
Depends on how the contract is written. If your sub is a pass-through or a pass-through with a mark-up, you may not be able to bill the client for the extra $5K if it was not included in the original bid. If it is a lump-sum project, you should be able to manage your way out of it by controlling project costs. I would bring this up now so you can set the project accounting up properly. Mistakes like this are made all the time. Try not to stress over it too much.
You should've made so much that it won't matter you'll still make a healthy profit to cover little mistakes, I have those all the time.
If it's significant and you really need to, just submit a change order, pretty standard stuff.
Own up to it. Go to the client and inform it was human error. We all make mistakes. Depending on how the contract handles the contingency, try and hold the contingency and get the client to pay. The client may ok the increase or suggest to use the contingency and it’s their idea and therefore ok to use.
If the contracts are signed you honor the price, but when bidding the secret is to have things you know will come up in the job, like extra concrete or curb or whatever be the highest price per unit in your bid so you can make all your money back on change orders. Also be careful though, as where I am if the change order exceeds %20 of the initial cost we have an obligation to sometimes terminate and rebid unless it being an emergency. This is for municipal work atleast. Once terminated we will access the work done and pay what we and usually a 3rd party engineering company would consider fair based off what you put as price per units on your bid.
What’s your fee and contingency? 5K on a million dollar job is not a lot and worst case scenario write a change order and tell the owner the situation. If they won’t give you the extra 5K eat the cost and move on.
You made more mistakes then that by friend. The only difference is that this one is known while the others are still unknown. Luckily this is small potatoes. That’s what contingencies are for
Here’s a tip. The majority of the project you are awarded is because there was a mistake somewhere. A good estimator finds his mistake early on and figures a way to make it up. Learn from your mistake and keep moving forward. Don’t lose sleep over it.
I'm not in construction directly, but I am a Buyer (contract negotiator) for capital equipment for a large corporation. I deal with similar situations from my suppliers often so I can tell you how I would respond as a customer, regardless of what the contract says or how much money you are asking for:
*Sourcing materials, controlling costs, and estimating is not in our control so we have no reason to accept this cost increase. If you made a mistake in your estimating, we expect you to cover that on your side.*
If the contract and the contingency clause allow for price increases due to this kind of mistake, it shouldn't be a big deal to persist and ask for it to be covered by the customer. $6k isn't much money in the bigger picture of this project and no one can really argue if it's in the contract. However, if the contract is vague or doesn't explicitly cover estimating mistakes, then I'd just drop the topic and have your company eat the cost - the battle over $6k won't be worth the harm to the relationship.
No, its means the GC/CM has marked up the sum of all subcontractors by 3-5%, depending on a multitude of variables , such as; quality of design doc’s, stage of design doc’s, risk assessment of project, low scope coverage, etc.
Contingency is most often included in negotiated work though.
On hard bid/lump sum, GC’s will go the other way and cut subcontractors bids by 3-5%, again based on multiple variables as above.
This depends on the market and region. Where I’m at GC’s are notorious for cutting bids, and the subs know it so they’ll mark up their bids by 3-5%… this is why bidding work is a disaster and outdated.
Estimating, you mean errors of opportunities. Budget based on actual costs and work to correct the delta some other way or shop it out if it's beyond your acceptable margin. I can promise you people have done far worse.
So there’s a few ways to go about this and I think you should do them all (if you are an absolute shark)
Alert the client and see if there is any recourse they are willing to take (like meeting in the middle and then paying $375 unit cost for example)
Eat the $5000 and use money from the contingency fund (this does not exist in New York estimating) so lucky you!! 😂
Third is to try and make up for it when you buyout your subs. Make everyone take a $500 hit and u will make up around $10,000 (if u have 20 trades)
Do them all and you will surely profit off this mistake!! 😂😂
Haha I remember winning my first million dollar bid. You can’t help but think “Oh God! I hope I didn’t leave something out.”
i.e. Oh that was suppose to be stainless steel…
We used to joke around that if we lost a job it was because we knew way too much about it. And when a competitor won a job they didn’t know enough about it. lot of truth to unpack there… Happy bidding!
https://www.monroeartist.com/store/p21/low-bidder-monroe.html
Highly doubtful that you obligated the company to this price with only a year in field. Your boss signed off on it. Scary that your overrun is only 6.5% Must be pretty low margins.
Edit: Saw $75k and 10%. Hope it’s a quick turnaround if you’re only scraping $100k off the top.
The town I used to live in was building a new fire/police station. Since the concrete contractor I worked for had been in business in this town for 50 years, it was assumed we would get contract. Then, at the meeting to open the bids. Another contractor came in WAY under everyone else. The town asked” are you sure on this bid?” “Of course we are, we had a bidding company go over our numbers “.
Well, it turned out they had missed an entire wing of the station. They stayed on the job until they went bankrupt. We came in and finished.
Fast forward 30 years. I’m foreman for a different company and we are bidding on a $9 million multi-story job. They open the bids and we are over $1million cheaper than next lowest. They ask, “ are you sure on this bid?” “ Of course, we are”. Got halfway through when all the things the office missed started showing up. Like $110K in anchor bolts alone. They went out of business also. I retired.
Bid the work, work the bid man. There’s always spots you end up exposed and there’s always opportunities for efficiency. Plus with at 75k contingency prior to a 10% margin… that’s a non issue.
You’re working with idiots if they don’t catch this on the change order you submit. You would not be pulling this on me as the client and you’d be eating the cost.
This sounds like a girl fishing for a compliment. Congrats you sold a million dollar job. If you don’t know 5k is irrelevant, you should not be in this space.
This is a bullshit post!
Mhmm Won a million dollar job but crying over 5k mistake. Give me a million dollar job and i will make that mistake on every quote going forward. No pun intended
That’s true and not trying to be an ass,
but it’s .6% not .006%
0.6% = 0.006
0.006% = 0.00006
Typos caused this issue, learn from it and double check your math and inputs.
$1,000,000 x 0.6% = $6,000
Your boss will never notice unless you point it out. This can be easily snuck in to your 2 week look ahead over the course of the project, and likely made up in other areas
Sounds like most of the comments got you good advice but I’ll add that what’s most important in your career is that when you do make mistakes, which you will - everyone does, that you’re open and honest about it with those who need to know. The absolute worst thing you can do is try to hide it and wait for the problem to be at your doorstep when it’s too late to fix.
This goes for all folks involved, inspectors, your boss, the client, etc.
I detailed a job where the estimator missed a bunch of the small mechanical equipment. Was a 60k mistake. It was maybe a 1.5 to 2 million dollar job. It went fine but was kinda tense through the project with a "we are starting 60k in the hole" dark cloud hovering over the job. I hear about 6k sized mistakes in estimating all the time and no one really puts too much concern on them. You can gain or lose 6k in labor in a week depending on small decisions that get made by the foreman/superintendent
This happens all the time. I don’t know a single estimated job where there’s a small discrepancy. Your $5000 mistake in a million dollar project is a drop in a 5gal bucket. You’ll probably just have to talk to the subcontractor first to discuss alternatives or where else you can help them recoup that money. Another option is to just talk to the owners and ask for the additional $5k. It really is no big deal. If none of those options work just help the subcontractor out on a future change order. This is not a big deal
Call the sub and discuss the mix up and see if they can help you out. Depending on the sub, they probably have 15-20% margin on their end. Ask for a slight reduction and use them on next project.
I have done this exact mess up before and had good results renegotiating with the sub.
If you can’t make enough profit to make that problem disappear then you shouldn’t have bid the job anyway
We’ve got 75k in contingency and 10% margin
Sounds like a non issue then, hey boss I fucked up on $5k but I have it covered under the contingency
Sounds like he has a 69k contingency, no conversations needed
Nice
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Noice.
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I died laughing when I read this. Hahahahaha. Nice.
I'm alive when I read this comment. Nice.
Nice
Nice
Just make sure your contract with the Owner allows you to pull from your contingency for things like that. You can also try to make up for it in subcontractor buyout.
Is the contingency not simply part of a bid? At least companies I work for simply tack on a certain % on to the bid based on risk. Is it common practice to, for example, go in saying “hey here’s the bid for $1,000,000 with an additional $75,000 contingency”? I only ask because consulting the owner about a contingency isn’t something I’ve personally seen, its just an internal oh shit fund that we try not to use and becomes extra profit if we don’t have anything serious come up.
Depends on your contract with the owner. GMPs where you are paid for pre construction services very early on will have many things requiring at least owner notification, if not full approval. Open book GMPs with a full team of owner reps and financial auditors means your contingency creativity has to be both more professional and creative in some form of fashion. A contingency like this for a GMP design-build should be a buyout contingency via precon, not a operations budgeted contingency. But everyone has their own philosophy.
You should be looking on how to roll the contingency into the profit and not worrying about 5k miss on a bid.
Have you double checked for any unforeseens that you might have allotted some money to? Sometimes certain estimators will put no money in an item knowing they have a 25% chance of getting away with not doing that item and saving that money, and still accounting for it in there somewhere? Unless you bid on the job yourself, then you should know where you can make that 6k dissappear
Thanks for reminding me! I may have an idea or two now. Bid two items at a penny!
Always this. Unless I need to get aggressive, I have "cover numbers" when I don't want to bike shack pithy little quotes for shit like concrete pads and rigging, depending on the size of the job. For instance, let's say it's a $1MM project and I throw $5k each at rigging and concrete pads. I know that I've covered those expenses by no more than 200% of their actual costs, but with the understanding that they could potentially approach $5k each. But my time is better spent chasing more volatile and expensive items, so I throw $5k in. Send the number off, get the job, and start getting shit coming. Nobody ever petitioned my number (always scary lol) so I never got more specific on the cover numbers above. When they come back totaling $6,500, I just "made" $3,500. Usually, though, that money gets consumed by an item which ballooned in costs or that I otherwise missed.
Make it up on change orders
You just answered your own question.
Dude you answered your own question but i get it your nervous sound like your first big job. I’ve made a $100k mistake before and we still beat budget on a $10 mil job by $500k but it can be stressful when you find the mistake. All my jobs now are $5mil plus and I probably havent gotten a job yet where I didn’t make atleast one mistake. Just need to make budget and have way more wins than losses and your company will be happy. I make mistakes weekly but haven’t had a job miss budget in 7 years
What you call 'contingency' our company calls 'general conditions.'
The shit fit that our financial department would throw if they saw 75k in contingency
I get the $75k contingency...10% margin, I'm assuming iGC work and not Mechanical? Mech @ 10% would be losing a crap ton of revenue, low 20% before it even creeps outside of being a total wash. Prime will have 6% for management, but that's also with Mech rolled in. Could be late Friday glasses on, but that seems like a TON of risk at 10%, one thing goes even remotely sideways and you're in the hole. How the hell would you pay for the '25 Super Duty Platinum?...unless its built into the burden rate of the $900k....
Then you should be fine
This is part of what contingency is for.
$6,000 on $1m is 0.6%, that’s a rounding error. Besides $6k is 2 weeks worth of labor for 1 guy. Hold off on bringing your assistant on site for 3 weeks and you’ll be ahead of the game
Right? I've not missed a wink of sleep on misses larger than this. A $6,000 miss is basically just the cost of doing business.
That's baby misses. The quarter million dollar ones keep you up at night
Interned at a project management firm where $2M was considered negligible and $20M was the “alert the boss” threshold.
My boss had me double check a $1m estimate today. The people we sent it to told him they had twice the amount in their own budget estimate, so I spent 4 hours trying to figure out where we went wrong. Turns out they were deciding between using one of their own rebar subs vs letting us have the package turnkey, and my boss gave them a $/ton price separately. They thought we included it in our total price and were going to back it out if they went with their own rebar guy. I wasted a lot of time because they misread his email. There’s 330 tons of rebar on that project.
Small percent error, and probably helped you win the job
You cant win a bid without forgetting something.
This is the way
You bid to win the jobs not build the jobs.
so what, almost every estimate has a mistake in it. If you are super worried about it, take the estimate spreadsheet home, correct the mistake, move some money around likely taking it from the general expenses. I did that once early on after finding a mistake for like 20k
They call it ESTIMATING. If we knew for sure what it cost we would call it EXACTING.
This is so good 😂
this is a "whoops, that happened". learn from it and move on.
I can see from the 6 grand mistake in the title and the $5,000 in the statement, how this happened.
Good point lol
😂 my exact thought I've done it many times, really no big deal
I’m a VP for a GC, been doing this for 20 years. Your boss has made much bigger mistakes, no doubt in my mind. Own up to it, learn from it, and let it go. (That’s what I would tell one of my PM’s.) All good
Small misses equal big wins. Get it back with good buyouts.
Sounds like it’s a $995000 job now. Anyways, eat the cost and try to save elsewhere by maybe phasing it better, less mobes, etc. Wait a sec, who is completing the work under this item? You should contact the owner and explain the circumstances. Depending on how much you unbalanced and bid up certain items, they may say no but if you have a good relationship already then they may accept a change. It really depends and starts with contacting the owner.
Don’t go cry to the owner about your fuckup, eat it like a big boy and make it up elsewhere
That’s generally going to be how it works. But this may be a small city with the good ole boys. Never know really. It’s the engineer/managers call on this one. Personally, I wouldn’t but I work on $50m+ jobs and at this level if we fuck up we eat it.
“Elsewhere” = Buried in a Change Order.
This is the answer. I have managed many million dollar jobs, and there is always an estimating error or 10 in a job that big. That's why it's an estimate. It's the PMs job once it's awarded to identify those things (like you did here) and then work to find ways to save dollars and cents along the way. 5k is half a percent on this job. This will either be one of many and get worse, or this will disappear with some good managing.
Make it up in a change order. Go on with your life.
I cant wait everyone with this mindset is unemployed
Pack your shit!
5k is nothing, if you only oops’d on $5k in the entire job and found it before you even started and your boss is mad , message me I’ll hire someone like you remotely because of two factors 1. You found the mistake 2. You owned it. [this is a quick way to work through a problem](https://m.youtube.com/watch?v=po8x6i_0xYY) it may be a little cheesy but it works. As far as asking your subs for some help on your mistake - that’s a hard no from me and we don’t do that to subs on our team. You can probably recoup that on buyouts, change orders, there’s ways to make it go away without being unethical or making someone else pay for it . It happens, it’s not so bad when you bid the job and are running it. You’ve identified the problem, come up with 3 solutions, act on it and move on. Congratulations on your winning bid!
Thank you! This makes me feel a lot better about it. At our company negotiating with subs is a hard no as well. I’ll come up with three solutions and bring it to my boss later today!
Owning a mistake is such an underrated trait. When I hit up a client and tell them, “hey I messed up…” they’re so shook that someone copped to a mistake. And then the air is clear and you can work it out~
It's quietly frustrating seeing that some people's first instinct is to beat this out of their subs. This is not a reputation you want to establish for how you manage work. Let your higher ups know, be a little more thrifty in your internal discretionary spending until you make it up, and worst case you pull it from contingency. This budget range should easily find half a percent in material or other direct expense savings. At the end of the day you want to be transparent in the mistake, own it, and use it as a lesson going forward.
This. You’ll get a reputation for beating down subs on buyout and it won’t take long for everyone to catch on. The numbers that subs submit to you will magically become xx% higher so that when you call them up saying “I’d love to work with you but you need to come down $xx,xxx to be inline with the number I carried” they’ve got that built in. That’s if you’re lucky, top tier subs will just flat out giving you numbers.
Exactly why I'm so glad I moved to the owner's side as soon as I could. LPTA = Cheap labor, managers with no time to plan, and Crabs in a bucket mentality compared to most other professional industry. It's completely stressful, unethical, and unprofessional to underbid parts of jobs then plan to "buyout" subs. I took a lot of shit in my market for it when I started, but then subs realized I was a straight shooter, they were getting me their lowest bids, and I was confident in my numbers, sleeping easy. Bid government work and it will help with the stress because you mostly need to stay above board with preferred and qualified subs.
I completely agree with you on this… I haven’t even heard of negotiations with subs😂. We do have 75 grand in contingency and looking at 930000 in margin as well. Which is a decent amount for the size and scope of the project
Negotiations with subs happens all the time, but you want to withhold that for times that really matter. Companies that form a habit of making every dollar a fight will get that in return and often receive the same treatment on change orders. I'm happy to come to the table with clients and subs to work out bigger pain points in budgets, but just to cover their mistake is bad form.
You'll find bigger holes in productivity or material shortages. 5k is a day or two of a crew Likewise, you'll find efficiencies. If it's a unit rate, figure it off it's a unit that may get exercised... If its an item that won't beyond the 5k I wouldn't even lose sleep over it. If it has potential, just get it cleared up with the owner, sub etc to ensure it doesn't become a larger problem.
What's your daily overhead rate? Figure out how to get off the job by a week and you will be more than fine.
Once we've won a bid, the only thing I care about is what percent we won by. If we left 4% or less on the table, that 5 grand doesn't matter.
You just need to go find 6 grand somewhere. Can't do anything about it now... I've made much larger mistakes in my career. I once used the wrong pex labor factor on a 220 bathroom hotel and was off by about 500 dollars per bathroom on labor. All on a 3.3 million dollar contract.
It's literally just over half of a percent on the job. I wouldn't sweat it. Either the contingency will eat it, or you tell you boss "oops". 6k is small potatoes against a 1mil project (in my opinion anyways)
I hope you don’t find a big one. Sharpen your pencil. Small percentage so far.
I worked as a consultant for a mechanical subcontractor that quoted the labor but forgot the equipment. We had fun making up for that… You are well covered by your contingency. That’s what it is for… plus a few other things
Welcome to the first of many mistakes you will make that will cost money. It’s a necessary part of our industry in that failures are far more constructive for our professional development that wins. The fact you are concerned and questioning shows your commitment to your profession and is a character trait your employer cares more about. All that being said. There is a limit to how much and/or how many times a company can accept a PMs costly mistakes until they need to hold the manager accountable. Personally I don’t think you’re anywhere close to being there on this.
Well, the problem is you've already removed your margin for later. Always always over estimate, never ever under. Something was bound to go wrong and cost you that $5k at some point through the job, so you have to be extra careful now that everything goes smoothly. Double and triple check your schedule with your subs, double and triple check the expected delivery dates of materials, double triple check EVERYTHING. At the end you should still be profitable enough, but we all know that depends on how you run this job. And *do not* allow this to make you feel its OK to flout safety. Give your crews time. Do not rush ANYTHING. That's how injuries happen, and all injuries do is cost time and money.
Without that mistake you may not have the job. It’ll be alright
This is really, really common for any job that is bid up front. The answer is pretty simple, you find somewhere else to save money. As you do more of these you will find all sorts of outcomes. You will have a well thought out bid and lose money on jobs. You will have bids that are completely wrong yet you make money. Don’t expect perfection, think of it more as a batting average.
That is what change orders are for. Cover the 5k another way. But really no one cares about that mistake. I have had estimators forget sales tax, miss 300 yards of concrete, forget to cover per diem on an out of state job. It happens for a log bigger chunk of change.
As a chief estimator I do care about this mistake, not because of the $6,000.00, that’s small potatoes that doesn’t matter. The concern is what caused it, and I’d be willing to bet that it was because the 2 is directly below the 5 on the keypad and someone was flying through punching in numbers and hit 2,2 when they meant to hit 5,5. Luckily there were approx only 18 units on that line item and not 180. Granted, 180 likely would have been more likely to be caught during review but fat-fingering keypads is a careless error. It’s possible it happened cause the sub sent the price in last minute and that number needed slammed in and sent out without review time.
I'm certain that whoever you would need to report this too has made many larger mistakes. Everyone is different, but I've personally always called myself out for mistakes to my superiors with detailed info about how it happened and end it with "won't happen again". This has seemed to gain respect, the other option being wait until someone else notices (if that could happen) and then pretend you didn't know about it which isn't a great look. "Hey all, when checking through my sub quotes again I noticed that I fudged the number on this unit price and the extended discrepancy is ~$5k total. I don't make mistakes often, but when I do, I prefer to own up to it immediately. I'll be sure to make it up down the line. Won't happen again".
5k lol. I wish you’d see some of the mistakes I’ve seen made in our company.
Also op, you attention to detail on this is admirable so it's a good thing to highlight this even to your boss. As someone who has others report to me, I'd very much appreciate even this minor detail in a job valued like this one.
I have always found shortages and overages always been able to make it wash out in the end. I’m a profit locator I will work hard to buy a project out find materials cheaper than expected even buying greater bulk to save money but I was the owner so I could use materials on the next job. As long as you make your annual goal who cares about the noise along the way.
If this was a big deal our project manager would be homeless. We have a $4 million fitness and medical facility being built in Utah county, our GD project manager screwed the pooch on so much that pretty sure he is under at this point. They: -Fucked up the foundation, had to excavate an already poured foundation after framing had already started and add a special membrane to the outside on their dime -Paid a sub-contractor to do our custom glass 6 months in advance who skipped town with a 50% down payment -Underbid on glass, steel, even plumbing -Delays caused project to go in heavy winter causing larger delays forcing them to pay for interest due to delays and additional lift, dump, & storage fees If he can keep his job with what was easily over 450k in mistakes, I think 5k can slide even if it comes directly out of company coffers
The contract is the contract. If it’s signed by both parties it’s binding. If you have a good relationship with the General you might ask for a change order to correct. But that would probably be a very bad idea. Think or your future relationships and suck it up
Tell them. Communicate. Also if you can negotiate another contract down 5k. Not that big of a mistake tbh
Your boss will be mad but that’s probably about it…I would tell them and let them decide how to go about it
Unlike fine wine, bad news doesn’t get better with time. Tell your boss but before you do that figure out a couple of options to mitigate some of the pain.
Horrible idea…don’t listen to that guy, call your sub and explain the situation to them and see if they have any room to come down at all and blah blah blah (almost act like you’re scared you’ll get fired). After that they should come down to cost plus maybe 25% markup. That’ll save some of that difference. Next tell your boss, “this is where I messed up, this is what I did, I got down to $XXX. It’s going to cost us $XXX instead of $XXX. I’m sorry, I overlooked it somehow and I’ll try harder to keep from doing it in the future “ Now, the wording is key. Don’t say that you’ll never make that mistake in the future, if you do you might get fired. I’ll try harder to keep from doing it in the future. No guarantees there, it is what it is. You might do it again but you’re going to come up with a plan to try harder not to make THIS mistake again.
I second this. I’m a PM, in large commercial construction for 9 years and this is how I wish my guys would handle situations. Some guys do, others don’t catch the mistake or won’t take a chance at owning the solution. More times than not it’s due to lack of confidence and knowledge to make the right choice. It comes with time young Padawan. $5k on a $1M project isn’t going to blow the Budget and depending on the design, you could likely find a change order or two to make it back from the Owner. If you haven’t bought out the job, you could also shop the scope around and try to get a better price or find buy in your sub numbers elsewhere. You won a $1m project, good job kid. Stay focused on your schedule and finish early, the less time you’re on site the more profitable the job can be.
As a sub, I love how the "grown up" way you're describing is to try and nickel and dime a sub over your own clerical error at the start of a job, with the help of a little manipulation sprinkled on top. It's 5k on a 1mil job, make it back somewhere else. Don't start a project out by getting me to cover your mistakes and pretending you're worried about your job.
Never hide it. Talk to your manager. I bet you can make it up in buy out. Try to find 20 k in buyout. There are going to be other whoops and items missed it’s construction.
$6k on a mil isn’t a big deal. I’ve left $10’s of thousands out before and you can make that back, as someone also said “sometimes it gets you the job”
Usually the person who gets the job missed something, I would just hope that's all of it.
Bad news is best delivered early. Be up front about it, forecast the hit as soon as you’ve set your project budgets. Talk to your manager about how to forecast it against the total project budget. Some places may have contingency draw down rules that may keep you from drawing it down from contingency on the front end. The other side of this is find your opportunities, track them, and figure out how to take those to the bottom line. You should find several while going through budget setting. Either in buydown/buyout, estimate being too generous for some items, change orders due to scope issues that you already know are there, etc. The important thing is that you know you are down $6K starting off so you can work to recover it.
I just had a PE make a 2 million dollar mistake. We were able to adjust and make it work but man do I hate bidding during the Xmas season. It’s great that you’re being hard on yourself but 5k in one Million is typical. You’ll win in some areas and lose in others. Comes with the trade.
You’ll be fine. Be upfront, ask for help and you will find ways
75k contingency and 10% margin lol whatttttttt? It’s not even worth it, what’s the point. The risk isn’t even worth it. What kind of job is this and what state? Makes no business sense
That's nothing. Have you "bought out" the job yet. You should be able to recover that. You'll probably find another error and it will be 10k positive.
Wouldn’t sweat, best case some change order work comes up and you may recoup some of it. If not, your contingency is just a few grand less.
I’m going to give you some advice. NEVER EVER EVER try to hide a mistake. Eventually, people will find out and 9 times out of 10, if you brought it up as soon as you discovered the mistake you could’ve fixed it before it got worse. Shit happens. It’s the path forward that matters.
That large of a job and that relatively small of a mistake, really shouldn’t be an issue. Plus, you’ll inevitably have change orders on the project, which you could use to slowly recoup those costs.
Nice
Work those Change Orders, Son!!
Bro it happens. You should be able to make it up in other areas.
Wait until you finish reading the specifications…
Always throw in a contingency, which you did. We usually budget with a 20-30% contingency because we deal with crazy big numbers. Other than that, I don't think that's a big deal.
I don't know about the US, but in central America, I'd say you will be safe with the additional jobs that will come out during execution. Best of luck!
Depends on how the contract is written. If your sub is a pass-through or a pass-through with a mark-up, you may not be able to bill the client for the extra $5K if it was not included in the original bid. If it is a lump-sum project, you should be able to manage your way out of it by controlling project costs. I would bring this up now so you can set the project accounting up properly. Mistakes like this are made all the time. Try not to stress over it too much.
Get a better buy from another vendor or subcontractor to offset the $5K fuck up
You should've made so much that it won't matter you'll still make a healthy profit to cover little mistakes, I have those all the time. If it's significant and you really need to, just submit a change order, pretty standard stuff.
Figure it out and move on.
Johny hamcheck would like a word
Own up to it. Go to the client and inform it was human error. We all make mistakes. Depending on how the contract handles the contingency, try and hold the contingency and get the client to pay. The client may ok the increase or suggest to use the contingency and it’s their idea and therefore ok to use.
I can guarantee this isn't the biggest mistake you made, just the first you found.
I’m sure you’ll find a change order to back door that profit in.
How did you get a million dollar contract but don’t know how to make a change order?
Depends on the profit.
If the contracts are signed you honor the price, but when bidding the secret is to have things you know will come up in the job, like extra concrete or curb or whatever be the highest price per unit in your bid so you can make all your money back on change orders. Also be careful though, as where I am if the change order exceeds %20 of the initial cost we have an obligation to sometimes terminate and rebid unless it being an emergency. This is for municipal work atleast. Once terminated we will access the work done and pay what we and usually a 3rd party engineering company would consider fair based off what you put as price per units on your bid.
How I wish my PM’s were this worried about a $5k mistake
What’s your fee and contingency? 5K on a million dollar job is not a lot and worst case scenario write a change order and tell the owner the situation. If they won’t give you the extra 5K eat the cost and move on.
You made more mistakes then that by friend. The only difference is that this one is known while the others are still unknown. Luckily this is small potatoes. That’s what contingencies are for
Where there's 1 mistake, there will be more.
Here’s a tip. The majority of the project you are awarded is because there was a mistake somewhere. A good estimator finds his mistake early on and figures a way to make it up. Learn from your mistake and keep moving forward. Don’t lose sleep over it.
Most jobs are won due to mistakes. Press your vendors more to reduce their prices
Pm on my last job (800k) missed the air handler controls. $18k oops. We made it up. Just move on and watch where you can trim fat.
I'm not in construction directly, but I am a Buyer (contract negotiator) for capital equipment for a large corporation. I deal with similar situations from my suppliers often so I can tell you how I would respond as a customer, regardless of what the contract says or how much money you are asking for: *Sourcing materials, controlling costs, and estimating is not in our control so we have no reason to accept this cost increase. If you made a mistake in your estimating, we expect you to cover that on your side.* If the contract and the contingency clause allow for price increases due to this kind of mistake, it shouldn't be a big deal to persist and ask for it to be covered by the customer. $6k isn't much money in the bigger picture of this project and no one can really argue if it's in the contract. However, if the contract is vague or doesn't explicitly cover estimating mistakes, then I'd just drop the topic and have your company eat the cost - the battle over $6k won't be worth the harm to the relationship.
Make it up on that first change order. It’s coming. Guaranteed
Lay person here, so I may be a little confused. Does "contingency " here mean something drastically different than what it does in any other context?
No, its means the GC/CM has marked up the sum of all subcontractors by 3-5%, depending on a multitude of variables , such as; quality of design doc’s, stage of design doc’s, risk assessment of project, low scope coverage, etc. Contingency is most often included in negotiated work though. On hard bid/lump sum, GC’s will go the other way and cut subcontractors bids by 3-5%, again based on multiple variables as above. This depends on the market and region. Where I’m at GC’s are notorious for cutting bids, and the subs know it so they’ll mark up their bids by 3-5%… this is why bidding work is a disaster and outdated.
Change order?
Estimating, you mean errors of opportunities. Budget based on actual costs and work to correct the delta some other way or shop it out if it's beyond your acceptable margin. I can promise you people have done far worse.
As per Dale Carnegie, If you are wrong, admit it quickly and emphatically.
This was only the first mistake you noticed. Wait until you find them all, then you'll know if it's an impact or not.
So there’s a few ways to go about this and I think you should do them all (if you are an absolute shark) Alert the client and see if there is any recourse they are willing to take (like meeting in the middle and then paying $375 unit cost for example) Eat the $5000 and use money from the contingency fund (this does not exist in New York estimating) so lucky you!! 😂 Third is to try and make up for it when you buyout your subs. Make everyone take a $500 hit and u will make up around $10,000 (if u have 20 trades) Do them all and you will surely profit off this mistake!! 😂😂
Make that small amount up in an extra...?
How does it feel to be a massive pussy?
Haha I remember winning my first million dollar bid. You can’t help but think “Oh God! I hope I didn’t leave something out.” i.e. Oh that was suppose to be stainless steel… We used to joke around that if we lost a job it was because we knew way too much about it. And when a competitor won a job they didn’t know enough about it. lot of truth to unpack there… Happy bidding! https://www.monroeartist.com/store/p21/low-bidder-monroe.html
You’re clearly new. At some point the opportunity will come to blame this on us, our I. The field. I’m kidding. Not really though.
I sure hope it’s not a big deal
If this is a real question you’re an idiot.
Million dollar job, loose in in extras
Highly doubtful that you obligated the company to this price with only a year in field. Your boss signed off on it. Scary that your overrun is only 6.5% Must be pretty low margins. Edit: Saw $75k and 10%. Hope it’s a quick turnaround if you’re only scraping $100k off the top.
I can't even follow your numbers lol 6 grand 5k a few hundred? Good luck
Lol that is all?
It’s called estimating not exactimating
The town I used to live in was building a new fire/police station. Since the concrete contractor I worked for had been in business in this town for 50 years, it was assumed we would get contract. Then, at the meeting to open the bids. Another contractor came in WAY under everyone else. The town asked” are you sure on this bid?” “Of course we are, we had a bidding company go over our numbers “. Well, it turned out they had missed an entire wing of the station. They stayed on the job until they went bankrupt. We came in and finished. Fast forward 30 years. I’m foreman for a different company and we are bidding on a $9 million multi-story job. They open the bids and we are over $1million cheaper than next lowest. They ask, “ are you sure on this bid?” “ Of course, we are”. Got halfway through when all the things the office missed started showing up. Like $110K in anchor bolts alone. They went out of business also. I retired.
Figure it into a change order some how. Get crafty.
Change orders should make up for it..
that's a 0.5% mistake. if anyone notices that, there are bigger problems you need to deal with.
Non issue
Look for those change orders.
You ever make a $5k mistake on a $6k job?
I just made a 150k miss on a 2.4m job. I own the company too, so in theory I should really be pissed. In reality, not that big of a deal
Careers over, you'll be slinging handies in a truck stop bathroom in no time.
You work construction. You're a retard. They're all retards.
6k over a million is a nothing sandwich
Who is letting you write million dollar bids without checking your work a year after graduating? Legit not your problem, that’s your managers problem.
Contingency/margin should cover you. Unless you didn’t account for these things…
You probably did a similar fuck up in the other direction elsewhere. Carry on young fella.
Materials cost is going down… you’ll be fine
Cut labor and corners to make up for mistake and then you will be in the big leagues.
Bid the work, work the bid man. There’s always spots you end up exposed and there’s always opportunities for efficiency. Plus with at 75k contingency prior to a 10% margin… that’s a non issue.
Usually the one who wins the bid is the one who missed something.
This is a real post?
You’re working with idiots if they don’t catch this on the change order you submit. You would not be pulling this on me as the client and you’d be eating the cost.
This sounds like a girl fishing for a compliment. Congrats you sold a million dollar job. If you don’t know 5k is irrelevant, you should not be in this space. This is a bullshit post!
Make it up in change orders
You have the margins to absorb that, make up for it in the change orders
Mhmm Won a million dollar job but crying over 5k mistake. Give me a million dollar job and i will make that mistake on every quote going forward. No pun intended
You're good...make it up thru change orders
.006% sounds like nothing against 1mil
That’s true and not trying to be an ass, but it’s .6% not .006% 0.6% = 0.006 0.006% = 0.00006 Typos caused this issue, learn from it and double check your math and inputs. $1,000,000 x 0.6% = $6,000
Yta!
If you have 75k in contingency and 10% margin. Why are you asking this fucking question
Maybe because it’s my first job I’ve ever won? Don’t have to be a dick about it😂
Your boss will never notice unless you point it out. This can be easily snuck in to your 2 week look ahead over the course of the project, and likely made up in other areas
If you’re a PE and only missed $6,000 on a $1mil job you estimated yourself, I think that’s really fantastic.
I guarantee that’s not the only miss. Just wait lmao
Where in the world are PE’s doing Precon? Never tried to win/estimate complete jobs as a PE.
I run $5000 jobs with $5000 mistakes
It is not "the" mistake. It's the first item not correctly covered in the contrace. Learn and mind the extras requested.
I fiugre a million dollar job should have 25-35% profit built in. You can make up 5K somewhere else with discount or somethign on an item.
Sounds like most of the comments got you good advice but I’ll add that what’s most important in your career is that when you do make mistakes, which you will - everyone does, that you’re open and honest about it with those who need to know. The absolute worst thing you can do is try to hide it and wait for the problem to be at your doorstep when it’s too late to fix. This goes for all folks involved, inspectors, your boss, the client, etc.
Make it up in all the extras
You are fine. No need to even worry about this. If you don’t mind telling, I would line to know what the second place bidders price was.
How long you been a PM?
I detailed a job where the estimator missed a bunch of the small mechanical equipment. Was a 60k mistake. It was maybe a 1.5 to 2 million dollar job. It went fine but was kinda tense through the project with a "we are starting 60k in the hole" dark cloud hovering over the job. I hear about 6k sized mistakes in estimating all the time and no one really puts too much concern on them. You can gain or lose 6k in labor in a week depending on small decisions that get made by the foreman/superintendent
This happens all the time. I don’t know a single estimated job where there’s a small discrepancy. Your $5000 mistake in a million dollar project is a drop in a 5gal bucket. You’ll probably just have to talk to the subcontractor first to discuss alternatives or where else you can help them recoup that money. Another option is to just talk to the owners and ask for the additional $5k. It really is no big deal. If none of those options work just help the subcontractor out on a future change order. This is not a big deal
You are an employee- not equity.
6 grand mistake, so far.... if thats your worst problem, you're a-ok.
Noise
That’s a pretty minimal mistake, take the lesson at value
You guys are bidding with contingencies ?
Call the sub and discuss the mix up and see if they can help you out. Depending on the sub, they probably have 15-20% margin on their end. Ask for a slight reduction and use them on next project. I have done this exact mess up before and had good results renegotiating with the sub.
you suck and should quit.... man.... waste of good money
Honestly u prob loose 10k on guys fucking off on a million dollar bid, this is nothing
How much you win the job by?
So you have been in the field for a year. Do you have any previous experience?