TUNNEL · CIVIL AND EARTHWORK · FIXED BY STEP 06

Six setups bill against one mobilization line

Six crossings means six setups and six teardowns, and the contract has a single capped mobilization item to cover all of it.

WHY IT'S A TUNNEL PROBLEM

A drywall crew stays in one building until it's done and mobilizes once. You set up, produce for a few days, tear down, and then do it five more times on the same contract against one mobilization line. Every idle stretch between crossings is somebody else's sequencing decision spending your rental money.

WHAT IT COSTS

The size of it

Remob runs $15K to $40K each time and shaft standby bills at daily rental rates, on a job that already invoiced its mobilization item. It reads as a job that was profitable at buyout and lost money at closeout, with no line explaining where it went.

OVERHEAD AT $1M–$5M
16%
CFOS target 15% for tunnel.
GROSS MARGIN AT $1M–$5M
23%
CFOS target 25.5% for tunnel.
NET PROFIT AT $1M–$5M
7%
CFOS target 10.5% for tunnel.

Tunnel work is a run of discrete mobilizations: crane, jacking frame, shaft shoring, dewatering, power, and roughly 11,000 square feet of laydown, built and torn down again at the next hole. Mobilization is usually one lump sum item, so remobs driven by the GC's sequence aren't automatically compensable. A finished bore then leaves an open shaft that can't be backfilled until the pipe crew ties in the carrier pipe. Shoring rental, pumps, plating, and traffic control keep accruing on a shaft producing zero feet.

WHAT TO DO

Three moves, in order

STEP 01
Cost code at the crossing level, with mob, drive, and demob under each crossing, so the loss has an address you can point at.
STEP 02
Log shaft open days on the daily report along with the rentals still on hire, and send it to the GC weekly while the shaft is open.
STEP 03
Bid mobilization per crossing, and get a stated remob rate and a shaft standby day rate written into the sub agreement before you sign it.
QUESTIONS

What tunnel owners ask

Getting paid for remobilization on multiple bore crossings?

Six crossings means six setups and six teardowns, and the contract has a single capped mobilization item to cover all of it.

What does it cost?

Remob runs $15K to $40K each time and shaft standby bills at daily rental rates, on a job that already invoiced its mobilization item. It reads as a job that was profitable at buyout and lost money at closeout, with no line explaining where it went.

What do I do first?

Cost code at the crossing level, with mob, drive, and demob under each crossing, so the loss has an address you can point at.

What are tunnel contractors supposed to be making?

Tunnel runs 23% gross margin, 16% overhead and 7% net profit before taxes at $1M–$5M. The all-trade average is 7%, so this trade is right on it. The CFOS target is 10.5%.

Which part of the system fixes it?

The step is number 06, project management. Billing dates, change orders, and notices, written as standards that work without anyone chasing them. It comes from chapter 6 of CONTROL: The Construction Financial Operating System.

OR HAVE IT HANDLED

Everything on this page is something you can install yourself, andCONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for tunnel contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.

What a fractional CFO does for tunnel contractors

AUTHOR
Josh Luebker
JOSH LUEBKER
MASTER ELECTRICIAN · 150+ PROJECTS · $2.1B+ MANAGED

Wrote CONTROL, the 8 step system behind these figures. More about the author.

8 Steps 60 Days

CONTROL is the full system, written for commercial subcontractors from under $1M to $100M. It's out now. 8 steps, 6 working templates, and the order they install in. $9.99 ebook, $24.99 paperback.