Scribd
Upload
3 views

CONSTRUCTION ESTIMATE

The document outlines procedures for creating detailed construction estimates, including reviewing contract documents, site visits, material quantity take-offs, and calculating direct and indirect costs. It emphasizes the importance of risk assessment, contingency planning, and profit margins in the bidding process. Additionally, it highlights factors influencing the decision to bid and the need for standardization and thorough documentation in the estimating process.

Uploaded by

Teresa Claire C. Agtay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
3 views

CONSTRUCTION ESTIMATE

The document outlines procedures for creating detailed construction estimates, including reviewing contract documents, site visits, material quantity take-offs, and calculating direct and indirect costs. It emphasizes the importance of risk assessment, contingency planning, and profit margins in the bidding process. Additionally, it highlights factors influencing the decision to bid and the need for standardization and thorough documentation in the estimating process.

Uploaded by

Teresa Claire C. Agtay
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 10

Construction Estimate and

Values Engineering
Procedures on Detailed Estimate
a) Thorough review of the bidding and contract documents, checking for its
completeness and subsequent analysis.
b) Thorough review of the drawings and technical specifications and subsequent
analysis.
c) Visit to the proposed site to document by pictures and observe the factors that
can influence the cost of construction:
• Available space for storage of materials
• Control of traffic
• Security
• Existing underground and aboveground facilities
• Zonal description
• Local laws governing the site
Procedures on Detailed Estimate
d) Material Quantity Take-Off Preparation
• Know how the project is to be constructed by preparation of
well-organized checklist of all work items necessary to construct the
project.
• Review each set of drawing, calculate the quantity of material, and
record the magnitude and unit of measurement on the appropriate
line item in the estimate.
• Basis for obtaining the cost of project materials are the unit cost from
the suppliers. Take note of the delivery, and cost of tax item for the
materials.
• The quantity of work required of the equipment is divided by the
equipment production rate and then multiplied by the unit cost of
equipment to obtain the total cost for the equipment.
• Quantity of work required for labor is divided by the labor production
rate and then multiplied by the cost of labor to obtain the cost of
labor. The common error in estimating is a quantity is omitted or
calculated twice. A careful recheck of the work by an independent
person is normally the solution to this common error.
• Subcontract specialize work and prepare set of drawing for the
contractor and specification to request a bid for their particular work.
Ex. Are roofing subcontractors, waterproofing subcontractors and soil
analysis subcon.
• The estimator must also add appropriate percentage for wastage of
those items where waste is likely to occur during construction. Ex. a
5% waste maybe added to the volume of mortar calculated for
bricklaying.
e) Materials, labor, equipments and subcontractors are Direct Cost.
Indirect cost are then prepared for taxed, permits, bonds, insurance
and overhead.
f) Risk of uncertainties is conducted to determine an appropriate
contingency to be added to the base estimate. Regardless of any
effort and amount of detailed estimating for a project, there is
almost always some unforeseen work that arises during
construction. Caution is required in assigning contingency because
a contingency that is too low might reduce the profit and a
contingency that is too high prevents the bid from being too
competitive.
g) Profit is added to establish the bid price. The amount of profit varies
depending on the site, complexity of the project, competition for the
work, volume of construction activity in the project. Profit may range
from 5% for large projects to 30% for small projects or
remodels/refurbish.
Factors Affecting Decision to Bid
• The investment of time and money to prepare an estimate and to compare
that investment to the probability of winning the bid.
• The risk that may occur during construction.
• Whether or not their labor skills and availability of their equipment will
match the requirement of the job to be bid.
• Must also assess the amount of work currently under construction by their
company to ensure the available credit for bidding additional work and
available working capital.
• Geographic location
• Complexity of the project
• Owner and designer’s reputation
• Potential of making a profit after the project is completed.
The Estimating Process Checklist
• Standardization is the key in preparing reliable estimates. The
estimating team must prepare a reliable standard procedure for
preparing estimates to ensure organization and consistency and
reduce the potential for errors.
• Kickoff meeting formalizes the creation of the org/members of the
estimating team. It provides background information about the
project to the estimating team, expectations of the team etc.
• Estimate Work Plan identifies the work that is needed to prepare the
estimate including who is going to do it when it is to be done, the
budget for preparing the estimate and the expected accuracy of the
estimate.
The Estimating Process Checklist
• A thorough documentation of the estimate forms the baseline for
project control, so decision can be made with better awareness of the
budget thereby improving the overall outcome of the project.
• A well executed estimate review will increase the accuracy and
credibility of the estimate, including the scope definition and the
basis of the estimate.
• The estimating team should be headed by a lead estimator from the
upper management. An assessment must be made to determine
workloads and capabilities of the in-house estimating staff. Additional
assistance from field personnel with experience from similar projects
should be obtained.

You might also like