The Importance of Realistic Material Prices and Proven Labor Units

by Richard Jaffarian, President Electrical Resources

Too often a contractor will do business with only one supplier assuming the material prices being quoted are reasonable and competitive when in most cases, they aren’t. Allowing yourself to be locked-in with one supplier is a win-win situation for that supplier and as long as you don’t raise the issue of what you’re paying for materials, the suppler won’t either. It also sends a message to other suppliers that they don’t have much of a chance to earn your business. At the moment, the economy is prospering and work is plentiful, but that’s not always the case and there will be times when you need reasonable prices to be competitive in a tight market. Contractors who deal with just one supplier call me saying that they can’t buy materials at the price levels I publish. Only after my suggesting they get quotes from other suppliers do they realize that they could have been buying at lower levels, winning more bids and making higher profits. Having multiple supplier accounts and treating them all honestly and fairly will ensure that you receive reasonable material pricing when you need it. 

Equally as essential to reasonable material pricing are realistic labor units. A labor unit represents the amount of time necessary to not only install an item, but getting the item to where it needs to be installed; having the proper tools and information to install the item; preparing the item for installation and cleaning up after the item is installed. A realistic labor unit is high enough to cover the direct and indirect labor to install material and low enough to maintain competitiveness in the bid market. Personal experience and historical data define the authenticity of labor units. Realistic labor units are essential in preparing competitive estimates however, to have realistic labor units be essential two simple rules must be followed: 1) the contractor understands the electricians’ responsibility is to install materials and 2) the contractor understands that it his responsibility to provide the electrician with the right materials with the right tools at the right time with the right information.


For more information on EPS+, and the Electrical Price and Labor Units Guide for current material price updates and labor units, visit