“Quite sure. Here is where your budget took a hit,” I said. “Check the line items for steel and permitting — they’re high. Also, did your original estimate include tax and engineering?”
“Hmmm, I see,” he said. “What if we don’t use steel and use wood instead? And do we really need to include all this landscaping?”
“Those items will make a difference,” I replied, tapping in a few new numbers. “You just saved $55,000 including tax.”
Our “what if” conversation continued for about 10 more minutes. As quickly as we thought of alternatives, I revised the costs. By the conversation’s end, we had the cost down to $600,000 — a doable project.
As Manny left, I saved the spreadsheet. I knew he would be back with new ideas. But I would be ready, ready to revise the estimate and produce new costs instantly.
Spreadsheets Are Powerful Tools, Take Advantage of Their Capabilities
Spreadsheets are awesome, powerful things. It is my experience, however, that few builders understand or take advantage of them. Pity, because what makes them so powerful is that they are easy to use and easy to learn.
When I started using Microsoft Excel 12 years ago, I was in the general contracting business. Our company did all their cost estimates on spreadsheets, which forced me to learn them. Coming from an engineering background, very quickly I came to appreciate the awesome power of Excel.
Today, I own a company, ConstructionCalc.com, that produces and sells Microsoft Excel spreadsheet templates, and now that I’ve gotten good with spreadsheets, I almost never use my calculator. If I’m doing a calculation I may repeat in the future, I do it the first time on a spreadsheet. It takes nearly the same time as using a calculator, but when I’m done I can save it to be used for another day. Plus, it is so easy to modify a number here or there, I can look at lots of “what-ifs” and get revised answers instantly.
So how do you learn spreadsheets? In my case, my office partner showed me a few (very few) concepts, then using Excel’s Help feature, I was off and running. Another great way is to get a copy of someone else’s spreadsheet and look at what they’ve done. Once you understand that an equation always starts with an equals sign (‘=’ in Excel; other brands use other means of denoting an equation), and you build equations just like you punch numbers into a calculator, you’ve got it whipped.
There are a few critical commands you’ll need too, like Copy, Paste, Insert and Fill. These will save you many hours of laborious typing; they are the commands that exemplify Excel’s real power. My rule of thumb is if you’re struggling with something in a spreadsheet, there is a better, faster way; you just need to figure it out.
Be careful, however, once you start using spreadsheets, you may wind up like me, hooked. Who knows, you too may one day become so proficient that you’ll be able to sell your templates.
Tim K. Garrison P.E. of ConstructionCalc.com has authored books and short courses and lectures on topics relevant to builders. Got a technical or management issue? E-mail firstname.lastname@example.org. Tim reads every one.
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The views expressed in this article represent the personal views, statements and opinions of the author and do not necessarily represent the views, statements, opinions or policies of the National Association of Home Builders. NAHB does not necessarily endorse any of the views expressed by the author and NAHB is not responsible for any direct or indirect consequences arising out of the views expressed in this article.
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