Chapter 1 Introduction.

Chapter 1 Introduction

Objectives Upon completion of this chapter, you will be able to:
List and briefly describe the different functions served by estimating in the construction industry Briefly describe the cost planning process including the role of conceptual estimates and preliminary estimates

Objectives (cont’d.) Describe the three main project delivery systems—traditional design-bid-build, construction management, and design-build—and explain how conceptual, preliminary, and detailed estimates are used with each Identify what type of estimating is required for lump-sum, unit-price, and cost-plus contracts

Objectives (cont’d.) Outline the detailed estimating procedure
Recognize the need for knowledge of Occupational Safety and Health Administration safety standards and the impact that compliance with the standards has on construction costs

Introduction Goal of this book:
Present a method of compiling consistently accurate construction cost estimates In a minimum of time Can be easily integrated with latest technology Intended to represent a standard or basic core

What Is an Estimate? Probable total cost of a future activity
Occurs in all industries and government agencies: Budget preparation for future expenditures Anticipate what something will cost Basic approach: Identify work items to be completed Measure work items size Assess likely cost of work

The Role of Estimating Figure 1.1
Role of the Estimator in the Traditional Construction Process (Delmar/Cengage Learning)

Conceptual Estimates Produced from owner’s notion of the construction:
Lacks design details Primary factors for project feasibility: Value and cost of development Cost profile embraces many constituents Some costs are easy to establish

Preliminary Estimates and Cost Planning
Prepared as design develops Informs whether design meets the budget Provides alternative design cost information Value analysis: improvement justification Can be subdivided into prices Groupings of building components

Preparing Construction Estimates
Main categories: Preliminary estimating techniques Detailed estimating techniques Influential factors: Project type Delivery system Nature of delivery system contracts

Figure 1.2 Types of Project and Estimating Methods (Delmar/ Cengage Learning)

Project Delivery Systems and Estimating
Traditional (design-build) delivery Project is fully designed before work begins Construction management delivery Facilitates overlap between project stages Allows earlier completion Design-build delivery Single organization assumes responsibility

Traditional (Design- Bid- Build) Delivery System
Figure 1.3 Traditional (Design- Bid- Build) Delivery System

Construction Management Delivery System
Figure 1.4 Construction Management Delivery System

Design- Build Delivery System
Figure 1.5 Design- Build Delivery System

Estimates for Different Types of Contracts
Lump-sum contracts Defined scope of work for stipulated sum Cost-plus contracts Uncertain total cost of construction Used if work must get underway or is difficult to define Contract followed by costing of operations

Estimates for Different Types of Contracts (cont’d.)
Unit-price contracts Measurement and payment Based on pricing schedule Breakdown of the work Estimated item quantities Enables owner to obtain competitive prices Some cost control

Estimates for Different Types of Contracts (cont’d.)
Detailed estimates Stages: Quantity takeoff Recap quantities Pricing the recap Pricing subcontractor’s work Pricing general expenses Summary and bid

Estimating and Construction Safety
Occupational Safety and Health Administration Safety standards Failure to comply may result in fines or imprisonment Cost of poor safety on the work site Growing awareness Direct and hidden costs

Summary Estimating serves several purposes
Preparation of bids and cost control Conceptual estimates: project feasibility Preliminary estimates: budget control Detailed estimates: forecast costs accurately Be aware of safety requirements Occupational Safety and Health Administration

The Estimating Process and Preliminary Procedures
Chapter 2 The Estimating Process and Preliminary Procedures

Compile the goals and objectives of a contractor’s estimating department Identify the sources of information about projects out for bid Distinguish open bidding from closed bidding

Objectives (cont’d.) Describe the process of prequalifying bidders and explain why it is done Describe contractors’ marketing strategies and explain why these strategies are pursued List and explain the factors considered when a contractor is deciding whether or not to submit a bid on a project

Objectives (cont’d.) Explain what is involved in the preliminary review of bid documents and the use of a query list Describe the purpose of the estimator’s site visit and list the items that should be considered on a local project and on a remote project

Objectives (cont’d.) Identify the benefits of using computers and modern communication technology in the estimating process

The Bid Estimating Process
Systematic approach Objectives must be clearly defined Profitable work Maximizing accuracy Maximizing productivity Effective estimating department utilization Company-wide cooperative approach

Figure 2.1 The Estimating Process (Delmar/Cengage Learning)

Projects Out for Bid Sources of bid information: Public bids
Advertisements and web pages Government notices Construction associations and news services Bid information services

Projects Out for Bid (cont’d.)
Private bids Invitations Business contracts and news items Architectural and engineering consultants Construction news services Construction associations plan service centers Bid information services

Open Bidding Allows all qualified contractors to bid and be considered for award of work Involves publicly advertised bid calls U.S. government agencies use a “Pre- Solicitation Notice (Construction Contract)” Construction associations Plan service centers Place where plans of projects calling for bids are deposited

Open Bidding (cont’d.) Closed bidding Prequalified bids
Direct bid invitation Avoids having a large number of bids Prequalified bids Bids from prequalified contractors only Construction news services Offer bid reporting services Convey project status

Open Bidding (cont’d.) Marketing Information gathering system
Ensures company is on bid list Information gathering system Business contracts Constant monitoring Often pursued by contractors offering construction management services

The Decision to Bid Factors to consider: Project type
Size and estimate of contract value Project location Quality of drawings and specifications Owner and designer reputations Specialized work

The Decision to Bid (cont’d.)
Anticipated construction problems Safety considerations Need for the work Bonding capacity

Scheduling the Estimating Process
Figure 2.3 Project Estimator’s Schedule (Delmar/Cengage Learning)

Bid Record and Bid Documents
Commonly recorded on a computer file Preset requirements Figure 2.4 Example of a Bid Report (Delmar/Cengage Learning)

Obtaining Bid Documents
Two complete sets of bid documents are usually requested Estimate documents Subcontractor takeoff and estimate preparation Designers usually require deposits for bid documents Reimbursed upon return

Review Bid Documents Bid documents Reviewed after listed on bid report
Obtain information for completion Highlight needed data Highlight anything unusual Check for easily missed items Number may be enormous Some selection is unavoidable

The Query List Compiled list of all questions Designers
Single call is made to cover all items Often clarified in documents Designers May encourage questions, but avoid continuous phone calls Fax and communications

The Team Approach Estimator Estimate review
Usually works alone on quantity takeoffs and cost estimates Quality is improved with input Should be encouraged to seek assistance Estimate review Brings team together to review work

Site Visit Figure 2.5 Local Site Visits
(Delmar/Cengage Learning) Figure 2.6 Remote Site Visits (Delmar/Cengage Learning)

Computer Estimating Systems
Computers Indispensable tool Perform many operations Not foolproof Requires understanding of basic estimating concepts Can be gained by working through them manually

Other Technology Includes: Fax machines Cellular telephones E-mail
Internet Computer-assisted design

Summary Use systematic approach to estimating Bid calls
Required due to number of people and amount of data Bid calls Many sources of information Several factors to consider Encourage team approach Utilize site visits and latest technology

Measuring Quantities Generally
Chapter 3 Measuring Quantities Generally

Define the quantity takeoff process Explain the process of measuring “net in place” and why this process is adopted Describe how takeoff items are composed Discuss the level of accuracy required for a takeoff

Objectives (cont’d.) Discuss the use of assemblies in the takeoff process Discuss the role of computers in the takeoff process Calculate the area of regular and irregular plane shapes Calculate the volume of a variety of solid figures

Objectives (cont’d.) Given the dimensions of a building plan, calculate the centerline length of the perimeter trench/footings/wall

The Quantity Takeoff Process of measuring work
Series of quantified work items Design is broken down Items are measured according to rules Standard format enables easier evaluation Method of measurement can be shared

What Is Measured? Takeoff: work quantities are measured
Not material quantities Quantity takeoff for cost estimate Measurements are made “net in place” Provides sufficient pricing information Includes items that don’t involve materials

Units of Measurement Two systems in North American construction
English system Metric system Estimators are advised to work entirely in one system Mixing increases probability of error

Item Units Basic categories: Number Length Area Volume Weight

Measuring “Net in Place”
Quantities are calculated using sizes and dimensions Indicated on drawings Reasons: Consistency Objectivity Unit price contracts Comparisons of operation efficiencies

Takeoff Rules Takeoff item components:
Dimensions Define the size or quantity Descriptions Classifies the item To be effective, preserve flexibility While keeping pricing and efficiency in mind

Accuracy of Measurement
Quantity takeoff Should accurately reflect amount of work Level of accuracy pursued Depends on costs and benefits of attaining high accuracy Extra time may not be justified Must be balanced

Organization of the Takeoff
Generally follows sequence of work activities Contract drawings usually presented in this sequence Measure concrete before excavation work or Begin with excavation measurement Assemblies: component considered separately Distinguished after project is divided into parts

Estimating Stationery
Specially printed forms Designed for each estimating procedure Used to increase productivity Contributes to accuracy of estimate Number of different formats Quantity takeoff Recapped onto separate sheets for pricing Takeoff and recap

Figure 3.3 Sample Pricing Sheet (Delmar/Cengage Learning)
Figure 3.4 Stationery for Combined Takeoff and Pricing (Delmar/Cengage Learning)

Formulas/Perimeter Centerline Calculations
Figure 3.5 Perimeters and Areas of Plane Shapes (Delmar/Cengage Learning)

Figure 3.6 Volumes of Solid Figures (Delmar/Cengage Learning)

Figure 3.7 Plan and Section of Wall (Delmar/Cengage Learning)
Figure 3.8 Plan of Corner of Wall (Delmar/Cengage Learning)

Figure 3.9 Plan and Perimeter Calculation of Wall (Delmar/Cengage Learning)
Figure 3.10 Plan of Exterior/Interior Corner (Delmar/Cengage Learning)

Figure 3.11 Wall Plans and Perimeter Calculations (Delmar/Cengage Learning)

Figure 3.12 Wall Plans and Perimeter Calculations (Delmar/Cengage Learning)

Summary Quantity takeoff Process of measuring work of a project
In the form of a list of quantified work items Uniform rules Contained in “measuring notes” Order of takeoff Follows construction sequence

Measuring Sitework, Excavation, and Piling
Chapter 4 Measuring Sitework, Excavation, and Piling

Determine the likely soil conditions at a site by studying a soils report Explain the use of swell factor and compaction factor when calculating volumes of excavation and backfill

Objectives (cont’d.) Define bank measure and explain how it applies to sitework takeoffs Describe and use the “grid method” of calculating cut and fill volumes Describe and use the “section method” of calculating cut and fill volumes Explain how piling work is measured in a takeoff

Objectives (cont’d.) Explain how trenches and basements are measured in a takeoff Complete a manual takeoff of sitework Complete a computer takeoff of sitework using Excel spreadsheets and MC2 ICE software

Generally Measuring sitework and excavation work
Different from measuring most other work Current site condition may not be provided Dimensions and shape of excavations may not be disclosed Estimators must assess requirements before measuring site work

Soils Report Provides subsurface condition information
Usually not a bid document Includes data for foundation system design Comments on sample soils report Topsoil, moisture content, soil compaction, slope ratio, drainage, etc.

Bank Measure, Swell, and Compaction Factors
Extracted soil Less dense and will occupy more space Compaction factor Difference between hole volume and fill material volume Bank measure Obtained using hole dimensions

Excavation Safety Considerations
Potential danger to workers Cave-ins OSHA’s Construction Safety and Health Regulations Requires shoring systems or cutting back sides to a safe angle Strongly enforced

Use of Digitizers Electronic devices Digitizer types
Enables user to take measurements from drawings Input directly into computer program Digitizer types Sonic Tablet

On-Screen Takeoff Eliminates need for paper-based printouts
Number of formats Cost savings Speed Convenience Plans still have to be drawn to scale

Measuring Notes—Excavation and Backfill
Include: Measure in cubic yards or cubic meters “bank measure” Classify and measure separately Excavations Materials Hand excavation Disposal of surplus soil

Calculation of Cut and Fill Using the “Grid Method”
Requires a site survey Showing elevation of existing grade Each intersection point on the grid Plotted at each intersection point Depth of cut can be obtained at each point Refer to Figures 4.1 and 4.2 Accuracy depends on grid spacing

Calculation of Cut and Fill Using the Section Method”
Mostly used with long, relatively narrow areas of cut and fill Road and railroad construction Results quality depends on accuracy of plotting Refer to Figure 4.3

Trench Excavations Formula for trench volume:
Trench Volume = Length of Trench Centerline × Average Width of Trench × Average Depth of Trench Refer to Figure 4.4 Sides of trenches often cut-back due to: Safety reasons Soil will not stand vertically

Trench Backfill Volume of backfill for a trench
Generally equal to volume of excavation minus volume of what is to be contained Surplus occurs when volume of excavation exceeds amount required for backfill Item for disposal of surplus material is required

Greater Accuracy Formula used to calculate volume of excavation:
Usually sufficient Some situations require more accuracy Example: pit and basement excavations

Measuring Notes—Piling
Often subcontracted to specialized companies Typical general contractor items: Layout of piles Cutting off tops of piles Removing excavated material

Bearing Piles Generally: Measure in linear feet or meters
Include a separate lump-sum item for equipment Piles that are measures separately Measurement may be subdivided Enumerate splicing and lengthening of piles

Bearing Piles (cont’d.)
Additional considerations: Classification of bearing piles Timber piles Steel piles Precast concrete piles Poured-in-place concrete piles

Sheet Piling Generally:
Described and measured in square feet or square meters Separately measure piles Measurement may be subdivided Measure withdrawing of piles Cutting off of sheet piling: measured in linear feet or meters

Sheet Piling (cont’d.) Splices: described and measured by number
Timber sheet piling, concrete sheet piling, and steel sheet piling: measured according to foregoing principles Extraction of piles: measured separately

Additional Examples Drawings Sitework takeoff
Refer to Figures 4.11 and 4.12 Sitework takeoff Example 1—The House Project Takeoff Shown as Figure 4.6a Example 2—The Office/Warehouse Project Takeoff Shown in Figure 4.14a Sitework Takeoff Using ICE Software

Summary The estimator has to make an assessment of sitework requirements Based on plans and specifications Site visit Soils report Efficiency can be increased using a digitizer Sitework takeoffs can be done manually or via computer

Measuring Concrete Work
Chapter 5 Measuring Concrete Work

Explain how concrete work, formwork, and associated items are measured in a takeoff Explain how concrete and formwork are classified in the takeoff process Measure concrete foundations from drawings and specifications

Objectives (cont’d.) Describe how reinforcing steel is measured
Complete a manual takeoff of concrete foundations Complete a computer takeoff of concrete foundations using Excel spreadsheets and MC2 ICE software

Measuring Concrete Work
Combination of items are measured Shown or inferred Concrete volume Formwork requirements Finishes needed Measure all work associated with one assembly Before moving to the next

Measuring Notes—Concrete
In general: Measure in cubic yards net in place Don’t adjust quantity for reinforcing steel and insets Classify concrete and measure separately Measure mixes separately Measurement/pricing of columns, walls, and beams dependent on placement/pouring

Measuring Formwork Formwork operations Involve a number of activities
Allowed for in pricing of forms Contact area is measured Establish surfaces of concrete that require forms

Measuring Notes—Formwork
Generally: Measured in square feet of contact area Same category classifications as concrete Bulkheads and edge forms are measured separately Forms to slab edges are measured separately From forms to beams and forms to walls

Measuring Notes—Formwork (cont’d.)
Openings in form systems No deduction made from total area if size of opening is less than 100 square feet Describe items that are linear in nature Describe forms to circular columns Diameter Measure in feet to column height

Measuring Notes—Finishes and Miscellaneous Work
Include: Slab finishes Screeds and curing slabs Welded wire mesh Inserts and waterstops Expansion joints Nonshrink grout Saw cutting concrete Reinforcing steel

FCE Office Foundation Takeoff Using ICE Software
Sitework for the FCE Office Takeoff of foundations Followed by slabs Refer to Pages 126 through 135

Figure 5.8 Dimension Entries (Delmar/Cengage Learning)

Figure 5.9 Specification Entries (Delmar/Cengage Learning)

Figure 5.10 Takeoff Entry Answers (Delmar/Cengage Learning)

Figure 5.11 Visual Takeoff Sketch (Delmar/Cengage Learning)

Figure 5.12 Pad Footing Entries (Delmar/Cengage Learning)

Figure 5.13 Perimeter Wall Entries (Delmar/Cengage Learning)

Figure 5.14 Column Pier Entries (Delmar/Cengage Learning)

Figure 5.15 Estimate Window (Delmar/Cengage Learning)

Figure 5.16 Slab-on-Grade Entries (Delmar/Cengage Learning)

Figure 5.17 Second Floor Slab Entries (Delmar/Cengage Learning)

Figure 5.18 Estimate Window (Delmar/Cengage Learning)

Summary Preparing a quantity takeoff of concrete
Requires measurement of a combination of items Concrete: measured in cubic yards or cubic meters net in place Formwork: measured in square feet or square meters of contact area Concrete finishes: measured in square feet or square meters

Measuring Masonry Work
Chapter 6 Measuring Masonry Work

Explain how masonry work and associated items are measured in a takeoff Explain how masonry items are classified in the takeoff process Measure masonry items from drawings and specifications

Objectives (cont’d.) Use conversion factors to calculate quantities of bricks, blocks, and masonry mortar Complete a manual takeoff of masonry work and associated items Complete a computer takeoff of masonry work using Excel spreadsheets

Masonry Work Generally
Includes construction with: Clay bricks Concrete bricks and blocks Clay tiles Natural and artificial stone Typically performed by subcontractors

Measuring Masonry Work
Measure “net in place” Calculating masonry units: Two-stage process Area of masonry is measured Standard factor is applied to determine number of masonry units A number of other units are measured Detailed in drawings or described in specifications

Brick Masonry Bricks: Influential factors: Made of different materials
Manufactured by different methods Used in many ways Influential factors: Price of masonry Measurement: sizes and pattern

Concrete Blocks Variables to consider: Bond beams Sizes
Thickness of joints Bond beams Measured as “extra over” blockwork Figure 6.1 Typical Concrete Block Sizes (Delmar/Cengage Learning)

Figure 6.2 Nominal and Actual Block Thicknesses
(Delmar/Cengage Learning)

Conversion Factors The Building Estimator’s Reference Book
States number of “standard bricks” per square foot of wall for different: Wall thicknesses Joint thicknesses Various bonds

Measuring Notes—Masonry
Generally: Measure quantities “net in place” Separately measure circular masonry work Include scaffolding and hoisting Measure separately by category Measure and enumerate several additional items (listed on page 144)

Measuring Notes—Masonry (cont’d.)
Some additional considerations: Brick masonry Measure in units of bricks Separately measure facing bricks Concrete block masonry Enumerate units stating type and size of blocks Separately enumerate special units Measure in cubic yards or cubic meters

Examples Masonry work—house (brick facings alternative)
Takeoff shown as Figure 6.3a Masonry work—office/warehouse building Takeoff shown as Figure 6.4

Figure 6.3a House Example—Masonry Work (Delmar/Cengage Learning)

Figure 6.3b Brick Facings Alternative—Details (Delmar/Cengage Learning)

Figure 6.3c Brick Facing—Detail at Foot of Facings (Delmar/Cengage Learning)

Figure 6.4 Office/Warehouse Example—Masonry Work (Delmar/Cengage Learning)

Figure 6.4 (Continued)

Summary Masonry work Includes construction with clay bricks and tiles, concrete bricks and blocks, etc. Typically performed by subcontractors Several items are measured during takeoff Quantities of masonry units are measured net in place Classified by types of units and use

Measuring Carpentry and Miscellaneous Items
Chapter 7 Measuring Carpentry and Miscellaneous Items

Describe a system that will allow an estimator to accurately measure detailed carpentry work on a large project Calculate quantities of lumber and sheet materials

Objectives (cont’d.) Describe how to measure carpentry work in a takeoff Describe how carpentry work is classified in a takeoff Measure rough carpentry, finish carpentry, and miscellaneous items from drawings and specifications Complete a manual takeoff of carpentry work and miscellaneous items

Measuring Rough Carpentry
Detailed carpentry work quantity takeoff Requires comprehensive carpentry knowledge when estimating Standard practices and code requirements Framing methods and design requirements Estimating commercial and institutional buildings Different skills required

Board Measure Unit of measurement of lumber
Figure 7.1 Sample Board Measure Calculations (Delmar/Cengage Learning)

Metric Units Metric system: Lumber will be in millimeters
Sheathing does not change Described in mm rather than inches Takeoff process Items of lumber: measured in linear meters

Measuring Notes—Rough Carpentry
Generally: Lumber Measured in board measure or linear meters Measure lumber separately Dimensions, dressing, grade, and species Describe special treatment required Kiln dried, pressure treated, etc.

Measuring Notes—Rough Carpentry (cont’d.)
Wall boards Measured in square feet or square meters Do not deduct for openings Less than 40 square feet Classify wall boards Measure separately Framing work Lumber is classified and measured separately

Other considerations: Trusses, truss joists, and truss rafters Manufactured beams, joists, and rafters Sheathing Copings, cant strips, fascias Soffits Sidings

Vapor barriers and air barriers Underlay and subfloors Blocking and furring Rough hardware

Measuring Finish Carpentry and Millwork
Finish carpentry on commercial project Materials Supplied by a millwork subcontractor Installed by general contractor Architectural woodwork Supplied by millwork contractor as finish carpentry Supplied and installed by custom subcontractor

Measuring Finish Carpentry and Millwork (cont’d.)
Estimators should be familiar with: Trade scope definitions of finish carpentry Architectural woodwork in project location Evaluate supplied items Items outside scope of subtrades All are priced for installation costs and supply

Measuring Notes—Finish Carpentry
Generally: Classify and measure items separately Rough carpentry: grounds, rough bucks, etc. Include allowance for rough hardware Metalwork: measured under miscellaneous metals Glazing: include in glazing section Unless integral part of prefabricated cabinet work

Measuring Notes—Finish Carpentry (cont’d.)
Other considerations: Trim Shelving Stairs Cabinets, counters, and cupboards Paneling

Doors and Frames Usually obtained from subcontractors
Quote prices and deliver goods General contractors Estimate cost of handling and installing Different sections of specifications Deal with metal and wood doors, frames, assemblies, and special doors

Windows General contractors Small jobs Obtains prices from subtrades
No work for them to measure Small jobs May not be worthwhile hiring separate specialists Components may be obtained directly from suppliers

Miscellaneous Metals Miscellaneous metals trade
Prices received from specialized subcontractors Supply and installation “Supply only” General contractor Ability to prepare a realistic estimate Wide scope

Specialties Specialty trades Wide-ranging trade section
Subcontractors will offer different price quotes Example: bathroom accessories

Finish Hardware Supply cost Estimating costs
Cash allowance is often specified on larger projects Otherwise obtained from a subcontractor Estimating costs Calls for quantity takeoff of all finish hardware requirements

Measuring Exterior and Interior Finishes
General contractor’s estimator Does not usually measure finishing work for an estimate Almost invariably subcontracted these days Performed on some occasions

Examples Carpentry and miscellaneous work takeoff—house example
Takeoff notes shown as Figure 7.2a Rough Carpentry—Floor System Rough Carpentry—Wall System Rough Carpentry—Roof System Finish Carpentry

Examples (cont’d.) Exterior and interior finishes takeoff—house example Takeoff shown as Figures 7.3 and 7.4 Exterior finishes Interior finishes

Summary Thorough knowledge of carpentry construction
Required to prepare a detailed estimate Estimator must apply a systematic approach Carpentry requirements of commercial and institutional projects Usually well detailed

Chapter 8 Pricing Generally

Describe the general process of pricing a construction estimate Explain the concept of risk as it relates to cost estimates of construction work

Objectives (cont’d.) Describe the two main components considered when pricing labor and equipment Describe a strategy for dealing with factors that are difficult to assess on a project Describe the use of cost reports as a source of information for pricing estimates

Objectives (cont’d.) Describe how materials are classified and priced in an estimate Identify the problems associated with pricing subcontractors’ work

Introduction Stages of pricing an estimate
Preparing takeoff for pricing Recap: pricing sorted list of items Labor Equipment Materials Subcontractors Job overheads

Contractor’s Risk Losing money in the process
Actual cost exceeds estimated cost Example: lump-sum contract risks Takeoff quantities are too low Productivity does not meet anticipated productivity Material suppliers fail to meet obligations

Pricing Labor and Equipment
Methods: Use of productivity rates Convert takeoff quantities Use of unit prices Applied to listed takeoff quantities Risk factors: Hourly rate of labor or cost of equipment Productivity of labor or equipment

Wage and Equipment Rates
Wage rates Represent average rates Vary according to location Include: Base wage rates Payroll additives Equipment rates Ownership costs and rental rates

Productivity of Labor and Equipment
Job factors Weather conditions Site access Storage space Nature of the project Other job factors (e.g., large versus small jobs)

Productivity of Labor and Equipment (cont’d.)
Labor and management factors Quality of supervision and labor Motivation and morale Tool and equipment quality and type Experience and records

Use of Cost Reports Database of past job information Key processes:
Priced takeoff items: coded to produce budget Labor- and equipment-hours: coded Quantity of work: measured Wage and equipment rates: applied to hours coded

Project Information with Cost Reports
Basic questions: Why did the estimator choose the original unit price for an item? Why did the actual unit price vary from the estimated unit price? Final cost report: Should include explanatory commentaries

Strategy for Pricing Labor and Equipment
Adjust unit prices for relatively certain job and management factors Be optimistic with other factors Some danger involved Identify estimating risks

Pricing Materials Categories:
Finished structure materials (e.g., concrete) Priced using unit prices against recapped work quantities Materials consumed during operations (e.g., oil) May be included in price of permanent work

Pricing Materials (cont’d.)
Questions: Do the materials comply with specifications? Do prices quoted include delivery? Will supplier’s prices to remain firm? Does the supplier’s price include taxes? Will there be any storage requirements? What are the vendor’s terms of offer?

Owner-Supplied Materials
Contractor-supplied material Most project specifications include descriptions Types, brands, etc. Owner-supplied materials Specifications may be skimpy Size, weight, and packaging are usually necessary More details may be required

Pricing Subcontractors’ Work
Problems: Not all subtrades offer lump-sum bids Bid unit or hourly prices Interpretation of what is part of the work of may differ Subcontractor whose price is used may be unable to perform the work

Summary Pricing an estimate consists of:
Sorting and listing items, then applying prices Costs may exceed estimated prices when: Takeoff quantities are too low Productivity does not meet anticipated productivity Subcontractors or material suppliers fail to meet obligations

Pricing Construction Equipment
Chapter 9 Pricing Construction Equipment

Identify the three main equipment categories and describe how each is priced in an estimate Explain the relative advantages of renting rather than owning construction equipment

Objectives (cont’d.) List and describe the types of expenses that should be accounted for when calculating the ownership cost of equipment Calculate depreciation allowances for construction equipment Calculate maintenance and repair costs on an item of equipment

Objectives (cont’d.) Calculate equipment overhead costs
Calculate fuel and lube oil costs on an item of equipment Determine the hourly ownership cost and develop the rental rate for an item of equipment

Introduction Categories of plant, equipment and tools
Hand tools Larger equipment Usually shared for activities Items for specific tasks Pricing calls for unit prices: Hourly, weekly, and monthly rates

Renting versus Purchasing Equipment
Determine if investments are justified Rental advantages: Large inventory does not need to be maintained Continuous access Little need for storage Reduced maintenance Simple accounting for costs Insurance savings

Renting versus Purchasing Equipment (cont’d.)
Full ownership cost aspects: Depreciation expenses Maintenance and repair costs Financing expenses Taxes and insurance costs Storage costs Fuel and lubrication costs

Depreciation Decline in asset market value Methods:
Straight-line: allocated equally per year over useful life of the asset Declining-balance: annual depreciation amounts decline as asset gets older Production or use: depreciation value in a specific year depends on asset use in that year

Maintenance and Repair Costs
Cannot be ignored when considering ownership costs Good maintenance: Can extend equipment life Reduces costs Calculated as a percentage of annual depreciation costs for each item

Financing Expenses Interest expense: cost of using capital Cash used:
Amount that would have been earned if money was invested elsewhere (i.e., forgone interest revenue) Financed by loan: Interest charged on the loan

Taxes, Insurance, and Storage Costs
Significant variations When known: should be added into annual ownership costs calculation When not known: calculated as percentage of average annual investment cost Equipment overhead rate Combination of interest expense rate, tax rate, insurance, and storage costs

Fuel and Lubrication Costs
Consumption can be closely monitored Assess to information: accurate future predictions No access: can be predicted Engine type and size Engine operating factor: load assessment

Equipment Operator Costs
Operating engineer May be included in agreement Usually not included Labor costs for operating equipment Apply engineer’s hourly wage with equipment hourly rate Use expected productivity to determine price per measured unit for labor and equipment

Company Overhead Costs
Fixed costs associated with running a business Full rental rates should include an: Amount for company overhead costs Amount for profit

Use of Spreadsheets Used due to repetitive nature of calculations
Ownership costs: large numbers of equipment Convenient updating of data Readily set up to provide basic format

Summary Categories of equipment and how they are priced:
Hand tools: percentage of labor price On-site equipment used intermittently: general expense item Equipment used for specific tasks: priced directly against the takeoff items

Pricing Excavation and Backfill
Chapter 10 Pricing Excavation and Backfill

Describe the job factors and the labor and management factors that influence the price of excavation and backfill operations Use historic productivity rates to calculate the unit price of labor and equipment for excavation and backfill work

Objectives (cont’d.) Calculate the price of gravels and other backfill materials Calculate trucking requirements for hauling excavated material and gravels Complete the recap and pricing of excavation and backfill work using manual methods Use Excel spreadsheets to price excavation and backfill work

Excavation Equipment and Methods
Specialized excavation contractors Concentrate on a single construction type: Vast array of excavation equipment Wide scope of work Common activities: Site cut and fill operations Basement-type excavations Trench excavations Pit and sump excavations

Excavation Equipment and Methods (cont’d.)
Equipment transportation expenses: Priced on an item-by-item basis Site cut and fill operations: Equipment depends on project scale Basement excavations: Often performed with a track backhoe Large basements: one or more track loaders

Excavation Equipment and Methods (cont’d.)
Trench excavations: Smaller trenches: trenching machines Larger trenches: backhoes Pit and sump excavations: Mostly performed using backhoes Hand excavation: Rarely used

Excavation Productivity
Job factors: Type of material excavated or backfilled Moisture condition of materials Weather conditions expected Site access and project size/complexity Distance to haul materials for disposal Availability of gravels and fill materials Wage and price levels at the job location

Excavation Productivity (cont’d.)
Labor and management factors Quality of job supervision Quality of job labor Motivation and morale of workers Type and quality of tools and equipment Experience and records of similar past projects

Excavation Work Crews Labor price per unit of excavation work
Elements to consider: Number of workers that comprise the work crew and their trades Wage rates of trades involved Probable productivity rate of crew or equipment they are operating Productivity time factor

Productivity Rates Sources:
Provided in publications (e.g., Means Building Construction Cost Data) Use with caution: general reflect ideal conditions Also available from manufacturers May be compiled from contractor’s own projects

Figure 10.3 Productivity of Hydraulic Excavators
(Delmar/Cengage Learning)

Figure 10.4 Sample Data Record (Delmar/Cengage Learning)

Excavation Materials Mostly comprise gravels and fill materials:
Required to meet designer’s specifications Backfilling Base courses under slabs and paving Pricing components: Supplying material to the site Spreading and compacting

Swell and Compaction Factors
Excavated soil or gravel: Less dense Swell factor: Occupies more volume Compaction factor: Allowance for extra material required to fill volumes with compacted material

Calculating Trucking Requirements
Determine optimum number of trucks required to transport materials Formula: Number of Trucks Required = Unloading Time/ Loading Time + One Example: Gravel Supply Pricing Refer to Pages 234 and 235

Additional Examples Excavation and Backfill Recap and Pricing Notes
Example 1—House Refer to Pages 235 through 240 Excavation and Backfill Pricing Notes Example 2—Office/Warehouse Building Refer to Pages 240 through 244

Summary Many subcontractors perform excavation and backfill work
Most specialize in some aspect Common methods: Site cut and fill operations Basement-type excavations Trench excavations Pit and sump excavations

Chapter 11 Pricing Concrete Work

Describe the job factors and the labor and management factors that influence the cost of concrete work Calculate and compare the costs of different concreting methods

Objectives (cont’d.) Describe the factors that should be considered when pricing concrete materials Identify the factors to consider when pricing formwork systems Calculate the price per unit area of form systems Describe the factors that influence the price of reinforcing steel

Objectives (cont’d.) Price miscellaneous items associated with concrete work Complete the recap and pricing of concrete work using manual methods Use Excel spreadsheets to price concrete work Adjust prices and productivities in MC2 ICE estimates

Cast-in-Place Concrete Work Generally
Concreting activities categories: Supply and placing concrete Construction and removal of formwork Supply and placing reinforcing steel Miscellaneous associated items

Supplying and Placing Concrete
Costs include: Cement Sand Aggregate Water Equipment to mix and transport Concrete mixing and batching plant Ready mix concrete

Productivity Placing Concrete
Cost of placing concrete in required position Depends on a large number of factors Job factors Labor and management factors

Job Factors Method of placing concrete Ready-mixed concrete Pouring
Hand-operated or powered buggies Concrete pumps Conveyors Combination of two or more methods Ready-mixed concrete Delivery rate

Job Factors (cont’d.) Properties of the concrete to be placed
Higher-slump mixtures: sloppier Lower-slump mixtures: flow more easily Superplasticizer additives: produce high-slump Fiber reinforced concrete: improves tensile strength

Job Factors (cont’d.) Size and shape of concrete structures
Large volume concrete “pours” cost less Placing concrete continuously is more economical Size and shape will impact placing method Amount of rebar in forms Large amounts may call for high slump

Job Factors (cont’d.) Concreting productivity rates
Most contractors maintain a database of historic unit prices Previous cost reports Site observations of work in progress Refer to Figure 11.1

Concrete Materials Prices for ready-mixed concrete Waste factors
Obtained from local supplier price list Quotations usually have conditions and extra charges attached Several issues to consider Waste factors Allowances for waste and spillage Increase takeoff quantities or raise price

Formwork Wide range of methods Number of costs to consider:
Building and maintaining the form system Setting up the system Removing the system Other costs (e.g., transportation, storage, etc.)

Formwork Productivity
Items that impact productivity and cost: Potential for reuse of a form system Complexity of formwork design Use of “fly forms” (“gang forms”) Number of form ties required for a system Formwork productivity rates: Refer to Figure 11.3

Pricing Formwork Materials
Material costs include: Rental or purchase cost of all components Form hardware cost Total system price: Expressed as a price per square foot or square meter of formwork Calculating price: Use of computer programs

Reinforcing Steel Includes welded wire mesh and reinforcing bars
Additional cost constituents: Rebar shop drawings Raw steel bars Handling, cutting, bending, and identifying rebar Transporting the bars to the site Spacers, chairs, saddles, and ties used Labor cost of installation

Reinforcing Steel (cont’d.)
Reinforcing steel—installation productivity: Affected by: Size and lengths of the reinforcing bars Shapes of the bars Complexity of the concrete design Amount of tolerance allowed in spacing of bars Amount of tying required

Miscellaneous Concrete Work Items
Concreting operations Several associated items Pricing miscellaneous concrete materials May not be exactly clear Example: items of setting slab screed

Wage Rates Basic hourly wages Equipment operator: $40.00
Labor foreman: $33.00 Laborer: $30.00 Cement finisher: $37.00 Carpentry foreman: $41.00 Carpenter: $38.00 Rebar rodman: $43.00

Examples Concrete Work Recap and Pricing Notes Example 1—House
Refer to Figures 11.9 through Figure 11.11 Concrete Work Pricing Notes Example 2—Office/Warehouse Building Refer to Figure 11.12

Pricing Using MC2 ICE Software
Items measured in takeoff Automatically priced from the unit price catalogue Can be modified Labor rates: refer to Figures and 11.14 Material prices: refer to Figure 11.15

Using the Drill Down Navigation Bar
Estimate Maintenance window Values may be changed Set up to show all items measured in takeoff May be useful to focus on specific parts of the estimate Refer to Figure 11.17

Summary Main categories for pricing concrete: Productivity:
Supply and placing concrete Construction and removal of formwork Supply and placing reinforcing steel Miscellaneous items associated with concrete work Productivity: Influenced by several factors

Pricing Masonry Carpentry, and Finishes Work
Chapter 12 Pricing Masonry Carpentry, and Finishes Work

Describe the specific job factors that affect the price of masonry work Explain what influences the material price of masonry bricks and blocks Describe the specific job factors that affect the price of rough carpentry work

Objectives (cont’d.) Explain what influences the material price of lumber Describe how finish carpentry is priced Describe how interior and exterior finishes are priced

Objectives (cont’d.) Complete the recap and pricing of masonry work, rough carpentry, finish carpentry, and interior and exterior finishes using manual methods Use Excel spreadsheets to price masonry work

Introduction Masonry work, rough carpentry, and finish carpentry
Commonly subcontracted Still performed by some contractors Specialized companies May have questionable reliability record Price errors

Masonry Labor costs Modularization Laying masonry
Installing accessories Ladder reinforcing and wall ties Masonry materials Modularization Factory construction of masonry panels Not common

Masonry Productivity Factors affecting productivity:
What is being built Workmanship required Size and weights of units Mortar and bond used Design complexity Presence or lack of repetition Availability of skilled trade workers

Figure 12.1 Masonry Work Productivities (Delmar/Cengage Learning)

Masonry Materials Prices vary Wastage Depend on requirements
Normally found in specifications When not provided, based on materials agreed upon (e.g., materials defined in the bid) Wastage More materials delivered than used Accounted for in takeoff quantities

Rough Carpentry Fabricated off-site Costs Assembled at the job site
Labor and material Lumber or fabricated components Cranes Beams Trusses

Rough Carpentry Productivity
Factors affecting productivity: Carpentry components Size of cross-section and length lumber Power tool use Design complexity Presence or lack of repetition Off-site fabrication

Rough Carpentry Materials
Specifications define: Species Use classification Lumber grade Softwood lumbar classifications: Yard, structural, factory, and shop lumber Rough, surfaced, and worked lumber Boards, dimension, and timber

Rough Carpentry Materials (cont’d.)
Lumber lengths and waste factors Generally multiples of two feet Waste factors still required Lumber grades Information on ability to meet requirements Rough hardware Mostly consists of nails Other fasteners may also be required

Finish Carpentry and Millwork
Pricing finish carpentry Applying materials and labor prices to items measured in takeoff process Productivity of labor crews Influenced by job factors Similar to rough carpentry

Exterior and Interior Finishes
Procedure: Measure quantity of each item of in takeoff List takeoff items on a recap Apply separate materials and labor prices Material prices: Determined by suppliers Productivities: Job, labor, and management factors

Wage Rates Basic hourly wages: Masonry foreman: $43.00 Mason: $39.00
Equipment operator: $40.00 Labor foreman: $33.00 Laborer: $30.00

Wage Rates (cont’d.) Cement finisher: $37.00 Carpentry foreman: $41.00
Carpenter: $38.00 Painter foreman: $37.00 Painter: $34.00

Examples Masonry, Rough Carpentry and Finish Carpentry Recap and Pricing Notes Example 1—House Refer to Figures 12.6 through 12.10 Masonry Work Pricing Notes Example 2—Office/Warehouse Building Refer to Figure 12.11

Summary This chapter reviewed pricing and influential pricing factors of: Masonry work Rough carpentry work Finish carpentry work Interior and exterior finishes

Pricing Subcontractors’ Work
Chapter 13 Pricing Subcontractors’ Work

Describe how subtrade work is usually estimated and explain the role of the contractor’s estimator in this process Identify potential problems with subcontractors on a project

Objectives (cont’d.) Explain how the competency of subtrades can be evaluated and list what should be considered in this evaluation Explain how surety bonds can be used to help manage subtrades Describe subtrade pre-bid proposals and explain their use with subcontractor bids Describe how subtrade bids are evaluated

Objectives (cont’d.) Describe the main features of bid depositories and explain their use with subcontractor bids

Introduction Subcontractors Building construction projects
Often perform 80% or more of the work Contractor has to rely on subtrades Good relationships Mutual trust Two-way communications Common goals

Potential Problems Possible reasons:
Unreliability of some subcontractors Errors in subtrade bids Overlap or underlap in scope of work Conditional bids from subcontractors Bid closing congestion Compliance with government positive action requirements regarding minorities

Managing Subcontract Pricing Procedures
Effective management practices Required throughout estimating process Control problems Well-organized system of dealing with subtrades Identify subtrade needs Ensure subtrade capabilities

List of Subtrades Complied after bid drawings and specifications are obtained Used to determine trades to be contacted Subtrades should be notified early in estimating process Design questions and problems are resolved

Contacting Subcontractors
Most contractors maintain a directory of subtrades Checklist on computer spreadsheet Estimator checks off or adds trades required Checklist is compiled Copy is ed to subtrades Subcontractors return checklist with name against trades they are prepared to submit prices

Unknown Subcontractors
Can be stressful Sometimes necessary Nominated subcontractors Deal made before bids Clause is inserted in bid documents Unsolicited subtrade bids Low price is received from unknown company

Evaluating Subcontractors
Main concerns: Is the subtrade capable of meeting the quality and schedule requirements? Does the subtrade have the financial capability required?

Evaluating Subcontractors (cont’d.)
Factors to investigate: General company reputation Quality of previous work performed Quality of company’s management Company’s disposition General cooperativeness Ease of dealing with site and personnel Financial status of company

Bonding of Subtrades Bonds are obtained to guarantee work performance
Surety bonds: manage construction risk Bid bonds: give prime contractor the right to damages from bonding company If subtrade fails to execute the subcontract after bid has been accepted

Pre-Bid Subtrade Proposals
Methods of submitting bids: Fax and Provides a hard copy Received quickly Pre-bid proposals: Copy of subtrade’s bid without prices Complete in all other details

Figure 13.2 Pre-Bid Proposal (Delmar/Cengage Learning)

Analyzing Subtrade Bids
Ensure all work required is included List inclusions detailing all the work Excluded items should be listed on the subtrade’s proposal Estimator has to lookout for items excluded from the work and not priced Complicated by multiple trade bids and discounts

Figure 13.3 Subtrade Analysis Spreadsheet (Delmar/Cengage Learning)

Bid Depositories “Bid shopping” or “bid peddling” Bid depositories
Disclosing prices to obtain an equal or better price Not illegal, but unethical Bid depositories Assemble bids from subtrades Distribute them to prime contractors

Scope of Work Trade scope definitions Examples:
Useful guide to what is accepted locally as the definitions of subtrades’ scope of work Enables overlap and underlap investigation Examples: Masonry scope of work Windows scope of work Glass and glazing scope of work

Summary Subcontractors on building construction projects
Often perform 80% or more of the work Several problems occur with subtrade bids Effective management practices Required to deal with subcontractors in the estimating process

Pricing General Expenses
Chapter 14 Pricing General Expenses

Define general expenses Use a checklist to identify general expense requirements for a project Explain how general expense requirements are assessed

Objectives (cont’d.) Describe how general expenses are calculated
Calculate general expenses for several items Identify general expense items that are calculated as add-ons Price the general expenses for a project using manual methods

Objectives (cont’d.) Use Excel spreadsheets to list and price general expenses Takeoff the general expenses for a project using MC2 ICE software

Introduction Direct costs measured in takeoff General expenses
Labor, material, and equipment General expenses All of additional, indirect costs General Requirements of the Project or Project Overheads General Expense sheet

Figure 14.2 Selection of General Expense Add-Ons (Delmar/Cengage Learning)

Project Schedule Realistic schedule of project work
Necessary at the time estimate Duration of project determines cost Prepared based on: Anticipated crew productivities Approximate methods for subcontracted work (e.g., bar-charts)

Figure 14.3 Sample Bar-Chart Schedule for an Estimate (Delmar/Cengage Learning)

Site Personnel Cost of site personnel Proportional to project duration
Determined by: Multiplying monthly payroll cost personnel by the number of months they are required Site personnel needs of a project Can vary enormously

Safety and First Aid Safety requirements expenses: First aid expenses:
Cost of workers’ time Attending safety meetings and engaged in safety-related activities Provision of safety awards and supplies First aid expenses: Cost of providing on-site first aid supplies Cost of personnel administering first aid

Travel and Accommodation
Charges include: Travel expenses for site staff Room and board expenses for site staff Travel expenses plus possible travel time allowances for project work force Room and board for the project work force Travel and other expenses incurred by head office staff on visits to project site

Temporary Site Offices
Costs may include: Rentals Costs to move trailers in and out Office furniture and stationery supplies Fax machines and copying machines Computers, printers, etc. Office heating, utility, and janitorial costs Catering facilities

Temporary Site Services
Costs include: Water services Electrical services for power and lighting Sanitary and storm sewer services Telephone services Installation costs

Hoardings and Temporary Enclosures
May include: Fences or barricades Covered walkways and supports Access stairs and railings Enclosures over work areas Covers, barricades, and partitions General protection of existing structures

Temporary Heating Categories of temporary heating: Costs:
Localized areas to allow operations Temporary enclosures Building heating to allow work completion Costs: Rental rate or ownership costs Fuel consumed

Site Access and Storage Space
Often interconnected Road or storage space may have to be cleared Usually detailed in contract specifications Access roads may need maintaining Cleanup and restoration of pavements Liabilities may be imposed Lack of space may be difficult to solve

Site Security May be spelled out in specifications
Can include a variety of items Examples: site fence, surveillance systems, security systems Unspecified security requirements Contractor must decide on how to proceed Specification conditions and trade-offs Other requirements

Site Equipment Sections and pricing methods:
Major equipment items: rental rates or ownership costs against hours used Tower cranes Hand tools and lower value equipment: percentage of total labor price Equipment kept at the site: priced with general expenses

Trucking Cost of providing incidental trucking Trucking requirements
Minor items of equipment and small material orders that need to be transported Best dealt with when equipment cost is estimated Trucking requirements Vary with size and type of project

Dewatering Cost of removing water from excavations and basements
Usually performed with submersible electric pumps and hoses Other techniques are available Sometimes detailed in specifications High risk in estimate

Site Cleanup Categories: Ongoing daily cleanup expenses
Renting garbage containers Constructing and taking down chutes Final cleanup expenses Cleaning, floors, fixtures, and windows Usually subcontracted

Miscellaneous Expenses
Common items: Layout Snow removal Saw setup Photographs Project signs Materials testing Water leakage tests Warranty Fire protection Wind-bracing Traffic control Municipal charges Financing charges Taxes

Labor Add-Ons Only calculated when total estimated labor cost has been determined May include: Small tools and consumables Wage increases Overtime premium Payroll additive

Bid Total Add-Ons Final group of add-ons Simple way to calculate
Assessed as a proportion of total bid price Calculated at the end of the estimate Simple way to calculate Apply percentage rates to final subtotal of estimate Produces a slight error

Examples General Expenses Pricing Notes Example 1—House
Refer to Figure 14.10 General Expenses Pricing Notes Example 2—Office/Warehouse Building Refer to Figure 14.11

Pricing General Expenses Using MC2 ICE Software
Allows many ways to assess and account for general expenses Simplest way: Select items required from the list that can be accessed in the Project Information window Refer to Figures through 14.15

Summary Indirect costs of construction projects:
General expenses or project overheads Usually general contractor’s responsibility to assess and price Calculated as percentage or function of duration Can be done manually or via computer

Chapter 15 Closing the Bid

Describe the estimate summary process Describe items that are addressed in the bid process Identify the three main objectives of a pre-bid review meeting

Objectives (cont’d.) Explain how the contractor’s risk on a project is identified and how the risk factor influences the bid markup Distinguish a unit-price bid from a lump-sum bid and describe the additional requirements of a unit-price bid Outline the tasks that should be addressed following a bid submission

Objectives (cont’d.) Finalize estimates using manual methods for both unit-price and lump-sum bids Use Excel spreadsheets to close an estimate and bid Use the MC2 ICE software to close an estimate and bid

Introduction Last stages of the estimate Bid summary sheet
Estimate prices are summarized Bid components are assembled Bid documents are submitted Bid summary sheet Gathers all of constituent estimate prices Distinguishes items that have to be priced

In Advance of the Bid-Closing
Contract bid is compiled in stages: Advance stage: concluded at least two workdays before bid-closing Review stage Closing stage Many estimators prepare a checklist Ensures all needs are taken care of

The Bid Form Includes: Project name and address
Owner and contractor identity Description of work List of bid documents and agenda Bid price and project duration Specified period for bid to be open Signatures, time, date, and place of bid

The Bid Form (cont’d.) Additional bid form information:
List of unit prices for pricing changes Alternative prices Separate prices Allowances Bid security Bid conditions

The Bid Form (cont’d.) Unit prices: Alternative prices (alternates):
Used for pricing added or deleted work Alternative prices (alternates): Quoted for proposed specification changes Separate prices: Bidders are required to state prices of specific items separately from the base bid Several reasons

The Bid Form (cont’d.) Allowances: Bid security:
Stipulated sum of money to be expended on a specific work item Cash allowances and contingency sums Bid security: Guarantees contractor will enter into a contract and furnish contract bonds Bid bonds and Consent of Surety

The Bid Form (cont’d.) Bid conditions listed on the bid forms
Bidder expresses agreement by signing or sealing the bid Many shift risk factor from owner to contractor Should be highlighted and brought to the attention of company management

The Pre-Bid Review Objectives: Topics in need of consideration:
Ensure there are no obvious omissions from the bid Consider ways of improving bid price competitiveness Consider an appropriate fee for the project Topics in need of consideration: Bid markup and need for bid clarifications

The Closing Important considerations: Staffing the bid-closing
Varies according to project size Telephones and fax machines Ensure clarity Subtrade conditions Evaluate consequences of acceptance

The Closing (cont’d.) Naming subcontractors Bid breakdown
Final list may not be available until moments before submission Bid breakdown Basis for evaluating monthly progress payments Prices include profit and overhead amounts Computerized bid-closing Perform all necessary calculations and price compilations

Unit-Price Bids Total amount paid to contractor Schedule of Prices
Depends on quantity of work completed Schedule of Prices Primary bid document Unit-price recap Reflects items on bid Schedule of Prices

Unit-Price Bids (cont’d.)
The summary Overheads and project fee are distributed against recap prices Achieved with wide spreadsheets The unit-price bid form Last stage in unit-price bid Unit prices are inserted against each work item listed on Schedule of Prices bid form

Unit-Price Bids (cont’d.)
Unbalanced bids Quantities of items containing overheads and fees decrease and quantity of other work increases Contractor is left with considerably less payment for overheads and fee than expected Contract documents may state unbalanced bids will be disqualified

After the Bid Items that need to be attended to:
Tabulate the bid results Compile the bid documents Return bid documents Store bid documents Compile and store the estimate file Handle subcontractors Post-bid review

The Estimate–Cost Control Cycle
Bid estimate Primary resource in project cost control Circular in nature Cost control process Pursued on a project-by-project basis Budget is set up Cost are allocated to items Reports are generated

Examples Summary Example 1—House
Refer to Figure 15.10 Summary Example 2—Office/Warehouse Building Refer to Figure 15.11 Pricing Subcontractors Using MC2 ICE Software Refer to Figures and 15.14

Examples (cont’d.) Estimate Summary Using MC2 ICE Software
Refer to Figures and 15.16 Printing Reports Using MC2 ICE Software Refer to Figure and 15.18

Summary Last stages in completing an estimate and submitting a bid
Requires careful planning and organization Most contractors use a standard format A number of tasks follow the bid submission Summarizing and preparing bids can be done manually or via computer

Chapter 16 Budget Estimating

Describe preliminary estimating options for preparing budgets Identify the strengths and weaknesses of each preliminary estimating option Differentiate single-rate methods from multi-rate methods of preliminary estimating

Objectives (cont’d.) Use the following techniques to prepare preliminary estimates: Cost per unit Cost per unit area Cost per unit volume Cost per typical bay Assembly estimating Develop unit prices for assembly estimates

Introduction Ways contractors obtain work
Changed over the years Alternative project delivery methods Primary goal: Achieving project completion more quickly

Methods of Estimating Preliminary estimating methods Categories:
Used to compile a budget When there is too little information for a detailed estimate Categories: Single-rate methods Multi-rate methods

Single-Rate Methods Price per unit Common unit is selected
Number of them is calculated for each project Strengths and weaknesses: Quick; requires little data; easily communicated Useful for rough check or comparisons Can be an indication of design efficiency Some data is published on unit costs Low accuracy and no rate breakdowns

Price Per Unit Area Unit of analysis: square foot or meter of gross floor area Area of all floors outside containing walls Strengths and weaknesses: Quick; requires little data; widely used Useful for rough check or comparisons Large amount of data is published Accurate only for small buildings No breakdown of single rate

Price Per Unit Volume Obtained by dividing total construction cost by building volume Strengths and weaknesses: Quick; requires little data; easy to communicate Useful for rough check or comparisons Some unit area costs data is published Not widely used Accurate with only similar buildings No rate breakdown

Multi-Rate Methods Price per typical bay Divides floor area into bays
Uses column gridlines Strengths and weaknesses: More accurate but requires more calculations Prices can be put together from publications Used for comparison and cost control Cannot be used on all buildings Not widely used

Assembly Estimates Objective: measuring and pricing assemblies that comprise a group Strengths and weaknesses: More accurate but requires more calculations Can be used with any building design Large amount of data is published Used for comparison and cost control Poor accuracy resulting from assumptions Can involve a lot of calculating

Figure 16.2 Office/Showroom Preliminary Notes

Figure 16.3 Assembly Estimate

Figure 16.4 Concrete Grade Beam Assembly

Elemental Estimates Most sophisticated preliminary estimating technique Greatest ability to manage project costs Conception to construction Refer to Chapter 17

Summary Single-rate methods: Multi-rate methods: Cost per unit
Cost per unit area Cost per unit volume Multi-rate methods: Cost per typical bay Assembly estimates Elemental estimates

Chapter 1 Introduction.

Similar presentations

Presentation on theme: "Chapter 1 Introduction."— Presentation transcript:

Similar presentations

About project

Feedback

Log in

Auth with social network:

Chapter 1 Introduction.

Similar presentations

Presentation on theme: "Chapter 1 Introduction."— Presentation transcript:

Similar presentations

About project

Feedback