Pricing material: quotes, setting materials, freight and tax

Price material from written supplier quotes for the exact specified products, with quantities from your takeoff. Add setting materials — adhesives, primers, seam sealers, accessories — from the manufacturer's coverage rates, then freight, handling and sales tax as your state applies it. Check each quote's validity and lead time against the bid and install dates, and protect yourself when a job may be awarded long after bid day.

By Michael Reddy, IntelBid

After this lesson you can

Request supplier quotes that can be priced without guessing
Estimate setting materials from manufacturer coverage rates
Account for freight, handling, tax and price escalation

What makes a supplier quote usable?

Exact products — manufacturer, style, color, size, as in the finish legend. A quote for a similar product isn't a quote for the specified one.
Quantities from your takeoff — including waste and attic stock, in the units the product is sold in.
Price validity — how long the price holds. Compare it with the bid date and the likely award date.
Lead time — from order (usually after submittal approval) to delivery. Check it against the schedule.
Freight terms — delivered to the job, to your warehouse, or ex-works; minimums and small-order charges.
Dye lots and minimums — whether the full quantity ships from one run, and any roll or carton minimums.

Don't forget setting materials and accessories

Adhesives, primers, pressure-sensitive releases, seam sealers, weld rod, transition strips, edge trims and stair nosings are easy to leave out and add up fast. Price them from the manufacturer's coverage rate for the specified method, not from a guess per square foot.

Material for a carpet tile packageWorked example · illustrative numbers

Carpet tile quote (277 + 8 cartons): $48,500
Adhesive coverage (example — use product data): 1,000 SF per pail
Area to receive adhesive: 12,400 SF
Adhesive price (example): $95 per pail
Freight to the job (quote): $650
Sales tax (example rate): 7% on materials

Adhesive: 12,400 ÷ 1,000 = 12.4 → 13 pails × $95 = $1,235.
Materials before tax: $48,500 + $1,235 = $49,735.
Sales tax: $49,735 × 7% = $3,481.45.
Add freight: $49,735 + $3,481.45 + $650 = $53,866.45.

Material cost of about $53,866 — about $5,366 more than the carpet quote alone. Illustrative prices, coverage and tax rate; whether freight is taxed also depends on your state.

How does sales tax work for subcontractors?

It depends on your state and on the job. In many states, contractors who install materials into real property pay sales tax when they buy those materials and then include that cost in their price, rather than charging tax to the customer. Other states treat it differently, and tax-exempt owners, direct purchase programs and out-of-state jobs add more variations. Confirm the rules for each state you work in with your accountant — and state in your proposal whether tax is included.

Freight, handling and storage

Delivery to the job vs. to your warehouse, and a second trip from warehouse to site.
Getting material to the floor — forklifts, elevator reservations, hoisting or hand carries on upper floors.
Storage — on-site space, a trailer, or warehouse days if the job isn't ready.
Acclimation — some products must sit in the conditioned space before installation, which affects delivery timing.

Protecting against price increases

If a job may be awarded months after bid day, your quote can expire before you order. Options: ask suppliers for longer price holds on big packages, state a validity period on your own proposal, and include a material escalation clause for long-lead or volatile products — for example, that material prices are based on quotes dated before bid day and will be adjusted if the manufacturer increases prices before order.

Escalation language only works if it's in the contract

A clause on your proposal can be overridden by the GC's subcontract. Raise it before signing, as with deposits and payment terms in getting paid faster.

Do flooring subcontractors pay sales tax on materials?

In many states, contractors installing materials into real property pay sales tax when they purchase the materials, but rules vary by state and by project. Confirm with an accountant for each state you work in.

How do you estimate flooring adhesive?

Use the manufacturer's coverage rate for the specified trowel or application method, divide the area by that coverage, round up to whole containers, and price from your supplier quote.

What should a flooring material quote include?

The exact specified products, quantities in sale units, price validity, lead time, freight terms, minimums, and whether the full quantity ships from one dye lot.

Key points

Quote the exact specified products with validity and lead time.
Setting materials and accessories come from coverage rates, not guesses.
Freight, handling, tax and escalation are real costs — state your assumptions.

In IntelBid · Proposal builder → Auto Draft

Current prices carry into the next bid

Auto Draft prices each takeoff line from the last unit price you used for that scope code. When a supplier raises prices, update the line on your next proposal and every later draft starts from the new number.

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About the author. Michael Reddy builds IntelBid, bid management software for commercial flooring subcontractors. These lessons come from the bid desk: how the work is priced, won and paid for.