What are Kits?
Kits are packed together groups of items required for a specific job or part of a job. Some estimating systems refer to kits as ‘assemblies’, but the terms are synonymous. By associating the amount of an item or service (such as labor) required for a base amount of a task (e.g. 4 tons of gravel and 5 hours of labor to complete 100 square feet of Paver Base Preparation), you can quickly calculate the amount of materials and/or labor required for the desired amount of the job you wish to add to an estimate.
Why Use Kits?
Kits are used to streamline the creation of estimates by creating packages of Labor, Materials, Plants, Equipment, Subcontractors, or Miscellaneous items that can all be added to an estimate at one time. At its most basic, a kit is a grouping of material and labor related to each other via a series of ratios or conversion factors. It is easy to see how the proper use of kits increases the speed, efficiency, and consistency of building an estimate. Instead of adding each item individually to an estimate, you may simply select the required kit and tell DS|Manage360 how much of that kit you will need for the job and the Kit will do the rest.
For example, the Paver Walkway Kit displayed under the Sample Kits section of this document ties together the amounts of paving stone, crusher run, clean fill disposal, and various labor types required to complete one (1) square foot of paving. This can then be multiplied by the number of square feet needed for the job to give the total amount of labor and material involved.
This document will cover the process of establishing your kits and then entering them into Manage360, as well as providing a few sample kits and a process on how to create and maintain your kits as your Costbook changes over time.
Before any Kits can be added to Manage360, both the decision of which Kits and what specific items will be included in each Kit need to be determined.
The responsibility for the Kit creation and the ongoing maintenance of the Kits is not typically done by a single person. Doing it in that way is not recommended. It is much better to create them in a collaborative environment which will result in greater accountability within the company. By doing it on your own, you could potentially fool yourself into believing that the values are correct which could have detrimental results. For example, a salesperson may keep the production lower in order to ensure the sales of the job, while a production person may have a bias toward the production side.
Typically, there should be representation from both the Sales and Production sides of the company. This could include the following roles: the production or operations manager, foreman or supervisor, and salesperson or estimator. The more people that can be involved (that have knowledge of production process and rates) the better. This will ensure that the Kits are as accurate as possible.
Depending on individual company processes the kits may look significantly different between each company.
Initially, there should be a discussion or meeting to determine which Kits are to be created into DS|Manage360. In this meeting, you will create a subset of repeatable tasks related to the type of work that is done on a regular basis. This should be done prior to determining the specific details of each Kit. For example, splitting the installation of a paver patio into repeatable tasks, or doing the same for the installation of a retaining wall.
Secondly, it should be determined how the kits will be broken down into specific equipment, material and labor and establish the company production rates. Please be aware that production rates from company to company differ as there are several ways to approach and complete the work. For example, there could be separate Kits for the paver base preparation and for the paver installation or these tasks could be combined as a single Kit.
Once the decision has been made as to which Kits are going to be created, and what the breakdown is going to be, the details of the individual Kits can be determined. The material required to complete the specific task must be determined. Also, any potential variable items in the Kit (lead item in DS|Manage360) should be considered as well. For example, a lead item for a Mulching Kit may be the different mulching options that can be chosen (e.g. Hardwood shredded mulch, pine bark mulch, cedar chips) as long as the production rate is the same for each of them. The most critically important part of creating Kits is to ensure that the production rates are accurate for the defined Kit items. If the production rates are incorrect, it will affect company profitability and ability to deliver jobs on time. These production rates are determined using the following process:
- Production rates are determined based on a specific size – the most common size used in building should be used in the Kit creation process.
- This includes doing the specific job 4-5 times while monitoring how long it takes to perform specific tasks and the amount of material that is used.
- They can also be based on previous quantities used in the estimation process.
- Review prior estimates and any job logs as well as any previous job costing
- Review prior estimates and any job logs as well as any previous job costing
- There should also be a consensus and sign-off between production and sales.
Other Kit Items
Although the basic Kit contains material and labor, more complex Kits could include other Costbook items like equipment, subcontractors, and miscellaneous.
Equipment can be added to a Kit if needed. It is typically only added to a Kit if it is specifically required for the work to be done in the Kit (it is unique to the Kit). If equipment is going to be onsite every day as part of the job; it is usually included via a General Condition. This is typically done for things like the crew truck and trailer. If the equipment is going to be used for multiple areas as part of the job, it should be added as an additional line item on the estimate (e.g. skid steer, excavator).
Additionally, subcontractor or miscellaneous items from the Costbook can also be added to kits if necessary. Subcontractors are usually added to a Kit as a replacement to the labor component, for example, a subcontractor doing the install of the items.
All Kits that are created then need to be tested by adding them to an estimate to confirm that the amounts being generated are correct. If there are items that require correction, then the Kits may need to be adjusted for the quantities or perhaps rounding.
All those present in Kit creation need to sign off on final Kit information that is going to be used in DS|Manage360.
The following is a list of examples, and are intended to provide insight on how you may approach the construction of your kits. Each of the following Kits were built and are used by long-time DS|Manage360 customers. It is important that as you build your Kits to pay special attention to the items and amounts required; the more accurate the contents of your Kit, the greater accuracy you will have in pricing your estimates. Because every landscape company is different and has different costs and production methods, the construction of similar Kits can have variances between companies.
Simple Kit #
An example of a simple Kit in DS|Manage360 would be a tree staking kit. There are typically no lead items, and only a limited number of standard items.
Medium Kit #
These kits may have more specific items and a more detailed labor breakdown, as well as potentially having lead items. They can include work such as paver installation – both with just a single paver type or using a combination in a defined proportion.
Complex Kits #
There are several situations where multiple Kits are required to complete a task in the field. For example, when doing a retaining wall, there may be 3 Kits used for the installation. The reason for this is that each Kit is measured with a single unit (square feet for example) and the items in it, are proportionally related to that unit – if the length of the wall is increased, then amount of materials and labor to do the base would increase as well. An additional reason for using multiple Kits is if the different Kits each have a lead item choice. In the example below, there are lead item options for both the wall face and wall cap which necessitates the separation of those tasks.
Kits used in Combination #
Retaining Wall #
In this example, there are 3 distinct Kits – the wall base, the wall face, and the wall cap. The wall base is based on a specified width and depth and is measure in linear feet, while the wall face is measured area and finally the cap is measure in linear feet.
Retaining Wall (option 2) #
Another way of handling an installation like a retaining wall would be to make more assumptions with the Kit, so that more items could be put together into a single larger Kit. For example, if the retaining wall Kit was based on a specific wall height and the lead items were limited to one part of the wall only, then it could be possible to combine the all of the work into a single Kit.
Maintaining Kits #
It is very important that the Kit amounts are reviewed on a periodic basis (at least once per season – more frequently if production is lagging) to verify that they are still accurate.
Any new work should be estimated normally until some average amounts can be determined prior to creating the Kit in DS|Manage360 and any newly added work/Kits should be verified more frequently to ensure accuracy.
A specifically chosen estimate can be used to generate detailed tracking information for comparison with the Kit setup.
If any changes are required to either the materials or labor, it will need to be adjusted in the DS|Manage360 Costbook. Once the change is made, it is important to test the Kit on an Estimate before it is put into production.
The Kits can be adjusted at any time if necessary. If issues arise from the use of the Kit, then it should be addressed in DS|Manage360 as soon as possible.
If Kits are updated and there are outstanding Estimates (not shown to client), then the Kits on that estimate should be updated to reflect the new changes. If any new items have been added to the Kit, then it would be best to remove the kit from the estimate and re-add it so that the new information is pulled forward.
Any updates in the Costbook will not automatically update existing estimates. Only newly created estimates will use the updated information.
Once basics have been determined, process to enter the Kits into DS|Manage360 can begin. Kits are entered into DS|Manage360 from the Costbook area. One important aspect of kits is that they may consist of both standard items and lead items. A standard item is any item always required for a job, a lead item will be one of several items which could be used for the job. When adding the kit to an estimate, you would select one of the lead items for use in the job.
Kits can consist of both standard items and lead items.
- standard items are any items that are always required for the kit to be done
- lead items are one of several items which could be chosen
- only one of the lead items can be selected on estimate
- all lead items would have same production rates
In DS|Manage360, the Kit elements are on 2 tabs – Details and Items. The following information is on the Details tab
- Name – required
- Description – optional. Can be used on the proposal.
- Division and Category – required. Categories defined in settings
- Kits are only visible in chosen Division
- Unit type – required. Kit has only one unit – all items in the Kit are proportionally related to the overall unit of the kit
Kit Items #
A kit can consist of only lead items, only standard items or a mixture of both. Individual items are added to the Kit by using the Add Item button.
- The Quantity Per is a known value for which you have calculated the production rates and quantities of materials and equipment.
- Associated with a unit type, this is the main value that provides kits with their flexibility
- Kits can have fixed quantities, values of a good/service which will not change based on the variable amount of the kit you are using
- Items/Services in kits can be rounded up the nearest value you specify (for example ‘1’ will round to the next highest whole number, while ‘0.25’ will round up to the next highest quarter).
Defining the amount of the Kit you wish to use on an estimate will take into account the ratios of the Quantity Per and all items within the kit to generate the amount of each item or service you need for the job.
Cloning a Kit #
The initial creation of a Kit can be a time-intensive process. Each Kit that is used in DS|Manage360 is based on some assumptions about the work being done (for example, the depth of excavation for a paver install depends on what is being installed as well as the use of those pavers will be. Since there are likely multiple scenarios that should be covered by the Kits, it is important to create Kits to handle those situations.
In order to facilitate the creation of similar Kits in DS|Manage360, it is possible to clone an existing Kit and make some adjustments to the material or labor ratios and then save the Kit. This allows a second kit to be quickly created that is based on the original kit. The Kit details and items tabs will be duplicated (excluding the Name). The values in the ‘Qty Per’ column of the Items tab can be adjusted to meet the requirements of the new scenario. A new name will need to be added before the Kit can be saved. Prior to the addition of any new items, the Kit must also be saved.