CFE guide · Estimating
Add Freight, Tax, Bond and Burden to Your Bid
Freight is priced per unit on each line; tax, bond, contingency and burden are percentages on the proposal price. Freight $/u is multiplied by the Mat’l Qty and sits inside the material cost. Under the Sub Total Job Cost, CFE adds Tax % on the material total, then Performance Bond, Contingency and Burden as percentages of the Sub Total Job Cost. The starting percentages come from Settings › Tax / Bond / Burden and can be changed on each estimate.
Why these costs go on top, not inside the prices
Tax, bond and burden are real costs on a flooring job, but they are not product costs. Bury them in the unit prices and three things go wrong: a tax-exempt job is overpriced, a bonded job is underpriced, and nobody can tell the GC what the bond actually cost when they ask to take it out.
CFE - Advanced Estimating Worksheet puts them where a GC expects to see them: as separate lines under the Sub Total Job Cost, each with its percentage. Freight is the exception. It travels with the material, so it is priced per unit on each line.
The four steps
- Set the defaultsSettings › Tax / Bond / Burden.
- Price freight per lineFreight $/u on the Mat’l Qty.
- Check the percentagesProposal Price box: Tax, Bond, Contingency, Burden.
- Tax-exempt and VAT jobsTax Exempt in the header; Tax or VAT in Settings.
1Set the defaults once
On the Settings tab, press Tax / Bond. Two boxes set the starting values for every new estimate:
- Bond / Burden / Contingency: the sample company starts at Performance Bond 1.00%, Contingency 0.00% and Burden 3.50%. You can rename each line (up to 22 characters) and the new name shows on the Estimate Quote, change orders and printouts.
- Tax: Sales Tax %, County Tax % and Municipal Tax % add up to the TOTAL TAX % · materials, charged on materials. TOTAL TAX % · labor is charged on the labor total only when you pick Include, which adds a Tax % – Labor line to estimates, change orders and proposals. By default labor tax is not included.
2Price freight on each line
In the takeoff grid, type Freight $/u next to Mat’l $/u. CFE multiplies it by the Mat’l Qty, attic stock included, and adds it to the Mat’l Sub, so material GP applies to it. The Freight Amount box under the grid totals it: Mat’l Qty × Freight $/u, $14,056.98 on the police substation bid. Lines that ship with another product, like base cove, can carry a lower freight rate than carpet tile.
Get freight per unit from your distributor’s last invoice for the same product, not a flat percentage. Carpet tile and sheet goods ship very differently, and $1.75 a yard on 3,000 yards is a number worth getting right.
3Check the percentages on the estimate
The Proposal Price box at the bottom right of the Estimate Quote lists the Total L&M, Additional / Misc and subcontractor totals, then the Sub Total Job Cost, then Tax %, Performance Bond (%), Contingency (%) and Burden (%) with their amounts, and the TOTAL PROPOSAL PRICE. Each percentage can be changed on this estimate without touching the defaults.
4Tax-exempt jobs and VAT
For a tax-exempt job, set Tax Exempt to Yes in the project header so it prints on the proposal, and check that Tax % in the Proposal Price box shows 0%. If most of your work is tax-exempt, set Tax Exempt to Yes in Settings: that sets tax to 0% on new estimates. Outside the US, Call it switches the label from Tax to VAT on estimates, change orders and proposals.
Worked example: the police substation proposal price
Willow Creek Police Substation, on the default percentages.
| Line | How it is worked out | Amount |
|---|---|---|
| Sub Total Job Cost | Line items, Additional / Misc and subs | $378,382.18 |
| Tax 8% | 8% of the $250,190.69 material total | $20,015.26 |
| Performance Bond 1% | 1% of the Sub Total Job Cost | $3,783.82 |
| Contingency 0% | $0.00 | |
| Burden 3.5% | 3.5% of the Sub Total Job Cost | $13,243.38 |
| Total Proposal Price | $415,424.64 |
The same rules hold on the Eastgate sample: 8% tax on an $85,273.06 material total is $6,821.85, and 1% bond and 3.5% burden on a $156,423.79 Sub Total Job Cost are $1,564.24 and $5,474.83, for $170,284.71. Freight is already inside the material total, so it is taxed with the material.
What to do next
Next, add the subcontractors and additional costs that feed the Sub Total Job Cost, and check your profit with markup vs margin.
Price tax and bond the right way
The Estimate Quote and every setting are in the 30-day free trial. No credit card.
Frequently Asked Questions
What does CFE charge sales tax on?
On materials, at the TOTAL TAX % for materials (sales plus county plus municipal). Labor is taxed only if you choose Include for labor tax in Settings.
How is the performance bond calculated in CFE?
As a percentage of the Sub Total Job Cost. On the police substation sample, 1% of $378,382.18 is $3,783.82.
Where is freight in a CFE estimate?
On each line: Freight $/u times the Mat’l Qty is added to the material cost. The Freight Amount box under the grid shows the total.
Can I change tax or bond on one estimate only?
Yes. The defaults come from Settings, and each percentage can be changed in the Proposal Price box of that estimate.
Written by
Cristian Valcu – Founder & CEO, Commercial Flooring Estimating LLC
Cristian has estimated commercial flooring for over 20 years and built CFE - Advanced Estimating Worksheet around the way flooring contractors actually price, propose and track their bids.
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