Construction Estimating: Types, Opportunities, The Estimator, and More

Building construction estimating involves determining the probable construction costs of a project. Many items influence and contribute to the cost of a project; each item must be analysed, quantified, and priced.

Because the estimate is prepared before the actual construction begins, considerable study and thought must be invested in the construction documents.

The estimator who can visualise the project and accurately determine its cost will become one of the most influential persons in any construction company.

For projects constructed with the design-bid-build (DBB) delivery system, contractors must submit a competitive cost estimate. As a result, the competition in construction bidding is intense, with multiple firms vying for a single project.

To stay in business, a contractor must be the lowest-qualified bidder on a certain number of projects while maintaining an acceptable profit margin.

This profit margin must provide the general contractor with an acceptable rate of return and compensation for the risk associated with the project.

Because the estimate is prepared from the working drawings and the project manual for a building, the estimator’s ability to visualise all the different phases of the construction project becomes a prime ingredient in successful bidding.

Working drawings typically contain information related to the design, location, dimensions, and construction of the project. In contrast, the project manual is a written supplement to the pictures, providing information about materials and artistry, as well as details on the bidding process.

The working drawings and the project manual constitute the majority of the contract documents, defining the scope of work, and must be considered together when preparing an estimate. Consequently, the two complement each other and often overlap in the information they convey.

The bid submitted must be based on the scope of work provided by the owner or the architect. The estimator is responsible for including all relevant information from the drawings and the project manual in the submitted bid.

Due to the complexity of the drawings and the project manual, along with the potential cost of an error, the estimator must thoroughly read everything and recheck all items. Initially, the plans and the project manual must be checked to ensure they are complete.

Then the estimator can begin the process of quantifying all of the materials presented. Every item included in the estimate must contain as much information as possible.

The quantities determined for the estimate will ultimately be used to order and purchase the needed materials. The estimated quantities and their associated projected costs will serve as the basis for project controls in the field.

Estimating the ultimate cost of a project requires integrating multiple variables. These variables fall into either direct field costs or indirect field costs.

The indirect field costs are also referred to as general conditions or project overhead costs in the construction industry. The direct field costs are the material, labour, equipment, or subcontracted items that are permanently and physically integrated into the building. For example, the labour and materials for the foundation of the building would be a direct field cost.

The indirect field costs are the expenses incurred for items required to support field construction efforts. For example, the project site office would be the cost of a general condition. In addition, factors such as weather, transportation, soil conditions, labour strikes, material availability, and subcontractor availability need to be integrated into the estimate.

Regardless of the variables involved, the estimator must strive to prepare as accurate an estimate as possible. Since subcontractors or speciality contractors may perform much of the work in the field, the estimator must be able to articulate the scope of work for these companies to furnish a price quote.

The complexity of an estimate requires organisation, the estimator’s best judgment, complete speciality contractors’ (subcontractors’) bids, accurate quantity takeoffs, and accurate records of completed projects.

The design-build (DB) and construction-manager (CM) project delivery systems are gaining popularity. In the design-build delivery system, the contractor acts as both the designer and the general contractor.

In the construction manager delivery system, the contractor is involved in the design process, providing expertise in construction methods and costs, as well as managing the construction process.

Both of these delivery systems require the contractor to provide cost estimates for the proposed project throughout the design process.

At the conceptual stage of the project, the contractor prepares a cost estimate based on the project’s concept. This is known as a conceptual estimate. When performing a conceptual estimate, typically, drawings are not available or are very limited.

What often exists is a vague verbal or written description of the project scope, accompanied by a few sketches. When preparing this type of estimate, the contractor makes assumptions about virtually every aspect of the project.

The conceptual estimate is used early in the design process to verify that the owner’s wants align with their budget. It is often used as a starting point for contract negotiations.

During the design process, the contractor prepares and maintains a cost estimate based on the current but incomplete design. This is often referred to as a preliminary estimate.

Additionally, the contractor may prepare estimates to select between building materials and determine whether the cost of upgrading them is justified.

What all these estimates have in common is that the design is incomplete. Once the design is complete, the contractor can prepare a detailed estimate for the project.

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Construction Estimating: Types of Estimates

The required level of accuracy, coupled with the amount of information available about the project, will dictate the type of estimate that can be prepared. The different estimating methods are discussed below:

1. Detailed Estimate

The detailed estimate includes the determination of the quantities and costs of all materials and resources required to complete the project. This includes materials, labour, equipment, insurance, bonds, and overhead, as well as an estimate of the profit.

To perform this type of estimate, the contractor must have a complete set of contract documents. Each item of the project should be broken down into its parts and estimated. Each piece of work that is to be performed by the contractor has a distinct labour requirement that must be calculated.

The items that are to be installed by others need to be defined and priced. Caution needs to be exercised to ensure that there is an agreement between the contractor and the speciality contractor regarding what they are to do, specifically whether they are to install or supply and install the items. Additionally, there needs to be an agreement on who will provide support items, such as cranes and scaffolding.

The contractor is responsible for ensuring that the scope of work is divided among the contractor and subcontractors, so that there are no overlaps in individual scopes of work and that everything has been included in someone’s scope of work.

The detailed estimate must establish the estimated quantities and costs of the materials, the time required for and costs of labour, the equipment required and its price, the items needed for overhead and the cost of each item, and the percentage of profit desired, considering the investment, the time to complete, and the complexity of the project.

2. Assembly Estimating

In assembly estimating, rather than bidding on each of the project’s individual components, the estimator bids on the components in groups known as assemblies. The installation of an assembly’s components may be limited to a single trade or may involve multiple trades.

An example of a simple assembly is a residential light switch, which includes a single-gang box, a single-pole switch, a cover plate, two wire nuts, and an allowance of 20 feet of NM-B 12-gauge wire. An electrician would install the entire assembly.

A residential electrical estimate can be prepared using assemblies for switches, outlets, lights, power panels, and other components, rather than determining the individual components.

An example of a complex assembly is a metal-stud and gypsum-board partition wall, which includes a bottom track, metal studs, top track, drywall, screws, tape, joint compound, insulation, primer, paint, and other miscellaneous items necessary for constructing the wall. Multiple trades would install this assembly.

Many high-end estimating computer programs, such as WinEst and Timberline, enable users to prepare detailed estimates by breaking down assemblies.

For the switch assembly, the estimator would determine the number of switch assemblies needed for the project, and the software would add the following components to the detailed estimate for each switch assembly: one single-gang box, one single-pole switch, one cover plate, two wire nuts, and 20 feet of NM-B 12-gauge wire. This simplifies the estimating process and increases the productivity of the estimator.

Assembly estimating is also helpful for conceptual and preliminary estimates. By using broad assemblies, an estimate can be prepared quickly for an entire building.

For example, an estimate for a warehouse can be prepared by using assembles for the spot footings, the continuous footings, the foundation wall, the floor slab (slab, reinforcement, granular base, vapor barrier, and fine grading), the exterior wall, personnel doors, overhead doors, joist and deck roof structure (including supports), roof insulation, roofing, wall cap, skylights, bathrooms, fire sprinklers, heating, lighting, and power distribution.

This type of estimate can be prepared in hours instead of spending days preparing a detailed estimate. The trade-off is that this type of estimate relies on many broad assumptions and is therefore less accurate. This type of assembly estimating is suitable for estimates prepared with limited drawings, for comparing design approaches, and as a check of a detailed estimate that appears to be significantly off.

If the assembly price is based on previously completed projects, it is assumed that this project is identical to the completed projects. That assumption is clearly not valid in the construction of buildings.

Weather conditions, building materials, and systems, as well as the design and construction team members, vary from project to project, all contributing to the uniqueness of each project. Skill and judgment must be applied when preparing this type of assembly estimate to ensure that proper adjustments are made, taking into account the varying conditions of each project.

3. Foot-Square Estimates

Square-foot estimates are prepared by multiplying the square footage of a building by a cost per square foot and
then adjusting the price to compensate for differences in the building heights, length of the building perimeter, and other building components. In some cases, a unit other than square footage is used to measure the building’s size.

For example, the size of a parking garage can be measured by the number of parking stalls it contains. The information required to produce a square-foot estimate is much less than is needed to prepare a detailed estimate.

For example, a preliminary set of design drawings (a single-line floor plan and key elevations) would have the dimensions that are necessary to prepare a square-foot estimate. Square-foot estimates help check whether the project, as designed, falls within the owner’s budget.

When preparing a square-foot estimate, care must be exercised to ensure that the projects used to determine the cost per square foot are similar to the proposed project.

Companies such as R.S. Means publish annual guides (such as Square Foot Costs) that contain a range of unit costs for a wide variety of building types. These guides provide several adjustments to compensate for varying building components, including the city in which the project is located.

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4. Parametric Estimates

Parametric estimates utilise equations that express the statistical relationship between building parameters and the building’s cost. The building parameters used in the equation may include the gross square footage, number of floors, perimeter length, percentage of the building that is common space, and so forth.

For an equation to be usable, the parameters used in the equation must be parameters that can be determined early in the design process; otherwise, the equation is useless.

Parametric estimates are similar to square-foot forecasts; however, the equations used in parametric estimates are more complex and may use log functions, ratios of parameters, and multiplication of parameters.

Parametric estimating helps prepare conceptual estimates based on assumptions about key building parameters or estimates based on early design concepts. As with square foot estimates and assembly estimates that use broad assemblies, care must be taken to ensure that the proposed project is similar to the projects from which the equation has been derived.

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Model Estimating

Model estimating uses computer models to prepare an estimate based on some questions answered by the estimator. Model estimating is similar to assembly estimating, but it requires less input from the estimator.

For example, an estimate may be prepared for a warehouse by answering the following questions:

• What is the length of the building?
• How many bays are along the length of the building?
• What is the width of the building?
• How many bays are along the width of the building?
• What is the wall height above the grade?
• What is the depth (from the grade) to the top of the footing?
• What is the floor thickness?
• Do you want wire mesh in the slab?
• How many roof hatches do you want?
• How many personnel doors do you want?
• How many and what size overhead doors do you want?
• How many and what size skylights do you want?
• Do you want fire sprinklers?
• What bathroom facilities do you want (separate male and female, unisex, or none)?

Based on the answers to these questions, the model generates a preliminary estimate for the project. Logic is built into the model, allowing it to select the necessary components for the estimate based on the answers to the questions.

For example, the size of the spot footings in the centre of the building, which support the roof, and their costs are selected based on the area of the roof the footings support, which is equal to the width of a bay multiplied by the length of a bay.

The length and width of the bays are calculated from the first four questions. A simple model estimate (Warehouse.xls) for a warehouse is provided on the companion disk.

This model makes several assumptions regarding the warehouse design, including the assumption that the exterior wall is constructed of concrete masonry units (CMU). The model ignores the site and excavation costs, which need to be added to the estimate from the model to obtain a complete estimate.

Estimating models can be complex, requiring a detailed estimate for the entire project, or they can be simple, resulting in a preliminary estimate for part of a project.

As with square-foot estimates, assembly estimates that use broad assemblies and parametric estimates require care to ensure that the proposed project is similar to the projects from which the model was developed.

Project Comparison Estimates

Project comparison estimates are prepared by comparing the cost of a proposed project to a completed project. When preparing an estimate using this method, the estimator starts with the costs of a similar project and then makes adjustments for differences in the project.

For example, an estimate for the buildings in an apartment project may be prepared based on a project built using the same plans in a nearby city during the previous year. In this example, the prices from the completed project need to be adjusted for inflation, changes in the availability and cost of labour, changes in the plans made to meet city codes, and so forth.

In most cases, the site should be estimated using an alternative method due to the numerous differences in site conditions. As with other estimating methods that do not prepare a detailed list of materials, care must be taken to ensure that the proposed project is similar to the completed project.

Estimating Opportunities

For those unfamiliar with the numerous opportunities in the estimating field, this section will review some of the areas where knowledge of estimating is essential.

Generally, knowledge of the procedures for estimating is required by almost everyone involved in or associated with the construction field. From the estimator, who may be involved solely in estimating quantities of materials and pricing the project, to the carpenter, who must order the materials required to build the framing for a home, this knowledge is needed to do the best job possible at the most competitive cost.

Others involved include the project designer, drafters, engineers, contractors, subcontractors, material suppliers, and material representatives. In the following sections, a few of the estimating opportunities are described.

• Architectural Offices

The architectural office will require estimates at three design stages: preliminary (rough square foot or project comparison costs), cost evaluation during drawing preparation (usually more accurate square foot or assembly costs), and a final estimate (traditionally based on material and installation costs, to be as precise as possible).

For projects built using the design-build or construction manager delivery systems, the preliminary estimate is often used during negotiations with the general contractor. Once the general contractor is hired, the general contractor’s estimator will prepare the remaining estimates.

In large offices, the estimating may be done by an estimator hired primarily to do all the required estimating. In many offices, the estimating may be done by the chief drafter, head or lead architect, or perhaps someone else in the office who has developed the required estimating skills. There are also estimating services or consultants who perform estimates on a for-fee basis.

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• Engineering Offices.

The engineering offices involved in the design of building construction projects include civil, structural, mechanical (encompassing plumbing, heating, and air-conditioning), electrical, and soil analysis.

All of these engineering design phases require preliminary estimates, estimates while the drawings are being prepared, and final estimates as the drawings are completed. They are prepared in the same way as the architects prepare estimates.

• General Contractors.

For design-bid-build projects, the general contractor prepares detailed estimates that are used to determine the company’s charges for the required work.

The estimator will have to take off the quantities (amounts) of each material; determine the cost to furnish (buy and get to the site) and install each material in the project; assemble the bids (prices) of subcontractors; and determine all of the costs of insurance, permits, office staff, and the like.

In smaller companies, one person may handle the estimating. In contrast, in larger companies, several people may collaborate to negotiate a final price with an owner or to submit a competitive bid.

On projects built using the design-build or construction manager delivery systems, the contractor’s scope of work involves providing assistance to the owners, beginning with the planning stage, and continuing through the actual construction of the project.

In this type of business, estimators will also provide preliminary estimates and periodically update them until a final price is determined.

• Estimating with Quantities Provided.

Estimating projects with quantity surveys involves reviewing the contract specifications and material requirements, examining the drawings for the type of construction used, and compiling the materials required.

The estimator will spend part of the time obtaining prices from subcontractors and material suppliers, and the rest of the time determining how the work can be most economically accomplished.

• Subcontractors.

Subcontractors may be individuals, companies, or corporations hired by the general contractor to do a particular portion of the work on the project.

Subcontractors are available for all the different types of work required to build any project and include excavation, concrete, masonry (block, brick, stone), interior partitions, drywall, acoustical ceilings, painting, steel and precast concrete, erection, windows, metal and glass curtain walls, roofing, flooring (resilient, ceramic and quarry tile, carpeting, wood, terrazzo), and interior wall finishes (wallpaper, wood paneling, and sprayed-on finishes). The list continues to include all materials, equipment and finishes required.

The use of subcontractors to perform all the work on a project is becoming an increasingly accepted model in building construction. The advantage of this model is that the general contractor can distribute the risk associated with the project to multiple entities. Additionally, subcontractors and craft personnel perform the same type of work on a repetitive basis and are, therefore, quasi-experts in their respective niche.

However, the general contractor relinquishes a substantial amount of control over the project when this method is employed. The more that the contractor subcontracts out, the more the field operation becomes involved in coordination rather than direct supervision of craft personnel.

The subcontractor carefully reviews the drawings and project manual, then submits a price to the construction companies bidding on the project. The price given may be a unit or a lump sum price. If a subcontractor’s bid is presented as the charge per unit, then it is a unit price bid (such as per square foot, per block, per thousand bricks, or per cubic yard of concrete).

• Material Suppliers.

Suppliers submit price quotes to contractors (and subcontractors) to supply the materials required for the project’s construction. Virtually every material used in the project will be estimated, and multiple price quotes will be sought.

Estimators will need to verify the specifications and drawings to ensure that the materials offered meet all contract requirements and comply with the specified delivery dates.

• Manufacturers’ Representatives.

Manufacturers’ representatives represent certain materials, product suppliers, or manufacturers. They spend part of their time visiting contractors, architects, engineers, subcontractors, owners, and developers to ensure they are aware of the availability of the material, its uses, and approximate costs.

In a sense, they are salespeople, but their services and the expertise they develop in their product lines make good manufacturers’ representatives welcome not as salespersons, but as needed sources of information concerning the materials and products they represent. Representatives may work for a single company or represent two or more.

Manufacturers’ representatives will carefully review the specifications and drawings to ensure that their materials meet all requirements. If any aspect of the specifications or drawings tends to exclude their product, or if they believe there may be a mistake or misunderstanding in these documents, they may contact the architects/engineers and discuss it with them.

In addition, they often work on various cost analyses to determine the installed cost of materials or products, devise new uses for these materials, explore alternative construction techniques, and even develop new products.

• Project Management.

Project management companies specialise in providing professional assistance in planning the construction of a project and maintaining accurate and up-to-date information about the project’s financial status.

Owners who are coordinating large projects often hire such companies. Among the various types of owners are private individuals, corporations, municipal government agencies (such as public works and engineering departments), and different public utility companies.

Both the firms involved in project management, as well as the staff member representing the owner, must be knowledgeable in estimating and scheduling projects.

• Government.

When a government agency is involved in any phase of construction, personnel with experience in construction and estimating are required. Included are local, state, provincial, and nationwide agencies, including those involved in highways, roads, sewage treatment, schools, courthouses, nursing homes, hospitals, and single- and multifamily dwellings financed or qualifying for financing by the government.

Employees may be involved in preparing or assisting in preparing preliminary and final estimates; reviewing estimates from architects, engineers, and contractors; designing and drawing the project; and preparing the specifications.

• Professional Quantity Surveyors.

Professional quantity surveyors are for-hire firms or individuals who make unit quantity takeoffs of materials required to build a project. They are available to provide this service to all who need it, including governmental agencies.

• Freelance Estimators.

Freelance estimators will perform a material takeoff of a portion or the entire project for those who need a job done. This estimator may work for the owner, architect, engineer, contractor, subcontractor, material supplier, or manufacturer.

In some areas, the estimator will conduct a material takeoff of a competitively bid project and then sell the quantity list to one or more contractors who intend to submit a bid on the project.

Often, a talented individual operates a combined drafting and estimating business. Part of the drafting business may include preparing shop drawings (drawings that show sizes of materials and installation details) for subcontractors, material suppliers, and manufacturers’ representatives.

• Residential Construction.

Estimators are also required for contractors, material suppliers, manufacturers’ representatives, and most subcontractors involved in residential construction.

From the designer who plans the house and the drafter who draws the plans and elevations to the carpenters who put up the rough framing and the roofers who install the roofing material, knowledge of estimating is necessary.

The designer and drafter should plan and draw house plans using standard material sizes whenever possible (or be aware of non-standard sizes when they are not using standard sizes).

Additionally, they will need to provide both preliminary and final estimates to the owner. Workers need to have a basic understanding of estimating so they can ensure that adequate materials have been ordered and will be delivered on time.

• Computer Software.

The use of computers throughout the construction industry offers various opportunities for estimators. Job opportunities in all the areas mentioned earlier will be centred on the ability to understand, use, and manipulate computer software.

The software available today integrates the construction drawings, estimating, bidding, purchasing, and project management controls. Some construction consultants specialise in building databases for computerised estimating systems and training estimators in the use of these systems.

The Estimator

Most estimators begin their careers doing quantity takeoff; as they develop experience and judgment, they develop into estimators. A list of the most critical abilities for the success of an estimator follows, but it should be more than just a read-through.

Any weaknesses affect the estimator’s ability to produce complete and accurate estimates. If individuals lack any of these abilities, they must (1) be able to admit it and (2) begin to acquire the abilities they lack. Those with construction experience, who are subsequently trained as estimators, tend to be the most successful in this field.

To be able to do quantity takeoffs, the estimator must:

1. Be able to read and quantify plans.
2. Have a keen understanding of mathematics and geometry. Most measurements and computations are made in linear feet, square feet, square yards, cubic feet, and cubic yards. The quantities are usually multiplied by a unit price to calculate material costs.
3. Have the patience and ability to perform careful and thorough work.
4. Be computer literate and use computer takeoff programs such as On-Screen Takeoff or Paydirt.

To be an estimator, an individual must take it a step further. He or she must

1. Be able, from looking at the drawings, to visualise the project through its various phases of construction. In addition, an estimator must be able to foresee problems, such as the placement of equipment or material storage, then develop a solution and determine its estimated cost.
2. Have enough construction experience to possess a good knowledge of job conditions, including methods of handling materials on the job, the most economical methods of construction, and labour productivity. With this experience, the estimator will be able to visualise the construction of the project and thus get the most accurate estimate on paper.
3. Have sufficient knowledge of labour operations and productivity to convert them into costs on a project. The estimator must understand how much work can be accomplished under given conditions by given crafts. Experience in construction and a study of completed projects are required to develop this ability.
4. Be able to keep a database of information on the costs of all kinds, including those of labour, material, project overhead, and equipment, as well as knowledge of the availability of all the required items.
5. Be computer literate and know how to manipulate and build various databases, use spreadsheet programs, and other estimating software.
6. Be able to meet bid deadlines while remaining calm. Even in the rush of last-minute phone calls and the competitive feeling that seems to electrify the atmosphere just before the bids are due, estimators must “keep their cool.”
7. Have good writing and presentation skills. With more bids being awarded to the best bid rather than the lowest bid, being able to clearly communicate what your company has to offer, including what is included in the bid, and effectively sell your services is crucial. It is also essential to speak to the project superintendent about what is included in the bid, how the estimator planned to construct the project, and any potential pitfalls.

People cannot be taught experience and judgment. Still, they can be taught an acceptable method for preparing an estimate, including items to include in the forecast, calculations required, and how to perform them.

They can also be warned against possible errors and alerted to specific problems and dangers, but the practical experience and use of sound judgment required cannot be taught and must be obtained over time.

How closely the estimated cost will agree with the actual cost depends, to a large extent, on the estimators’ skill and judgment. Their skill enables them to use accurate estimating methods, while their judgment allows them to visualise the construction of the project throughout the stages of construction.

Types of Bids

Basically, the two bidding procedures by which the contractor gets to build a project for the owners are as follows:

Competitive bidding

Competitive bidding involves each contractor submitting a lump-sum bid or a proposal in competition with other contractors to build the project. The project may be awarded based on the price or best value.

When the project is awarded based on price, the lowest lump-sum bidder is awarded the contract to build the project, provided the bid form and proper procedures have been followed, and the bidder can obtain the required bonds and insurance.

When the project is awarded based on the best value, the proposals from the contractors are rated based on specified criteria, with each criterion given a certain percentage of the possible points.

The criteria may include a review of the assigned project team’s capabilities, the company’s capabilities and approach to the project (including the schedule), proposed innovation, method of mitigating risk, and price.

The price is often withheld from reviewers until the other criteria have been evaluated, to prevent it from influencing the ratings of the different criteria. Most commonly, the bids must be delivered to the person or place specified by a time stated in the instruction to bidders.

The fundamental underlying difference between negotiated work and competitive bidding is that the parties arrive at a mutually agreed-upon price, terms, and conditions, as well as a contractual relationship.

This arrangement often entails negotiations back and forth on virtually all aspects of the project, including materials used, sizes, finishes, and other factors that impact the project’s price. Owners may negotiate with as many contractors as they wish.

This type of bidding is often used when owners already know which contractor they would like to build the project, in which case, competitive bidding would be a waste of time.

The most significant disadvantage of this arrangement is that the contractor may not feel the need to work quite as hard to get the lowest possible prices as when a competitive bidding process is used.

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Contract Documents

The bid submitted for any construction project is based on the contract documents. If an estimator is to prepare a complete and accurate estimate, he or she must become familiar with all of the papers. The documents are listed and briefly described in this section.

For design-bid-build projects, the contract documents comprise the owner-contractor agreement, the general conditions of the contract, the supplementary general conditions, the working drawings, and specifications, including all addenda incorporated into the documents before their execution. All of these documents become part of the contract.

• Agreement. The agreement is the document that formalises the construction contract, and it is the basic contract. It incorporates by reference all other documents and makes them a part of the contract. It also states the contract sum and the time allowed for constructing the project.
• General Conditions. The general conditions define the rights, responsibilities, and relations of all parties to the construction contract.
• Supplementary General Conditions (Special Conditions). Because conditions vary by locality and project, supplementary general conditions are used to amend or supplement portions of the general conditions.
• Working Drawings. The actual plans (drawings, illustrations) from which the project is to be built are the working drawings. They contain the dimensions and locations of building elements and materials required and delineate how they fit together.
• Specifications. Specifications are written instructions that describe the project requirements, including the quality of materials to be used and their expected performance.
• Addenda. The addenda statement is a drawing or information that modifies the basic contract documents after they have been issued to the bidder, but before the bids are taken. They may provide clarification, correction, or changes in the other documents.

For projects built with the design-build and construction manager delivery systems, the contract documents are more limited than for projects constructed with the design-bid-build delivery system, because the contractor is involved in the design and selection of the project’s specifications.

These documents can be as simple as an agreement with a conceptual description of the project.

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Bidding Information

There are several sources of information on the projects available for bidding. Public advertising (advertisement for bids) is required for many public contracts.

Advertisements are generally placed in newspapers, trade magazines, and journals, while notices are posted in public places and on the Internet. Private owners often advertise in the same manner to attract a large cross-section of bidders.

Included in the advertisement is a description of the nature, extent, and location of the project; the owner; the availability of bidding documents; bond requirements; and the time, manner, and place where the bids will be received.

Availability of Contract Documents

When paper copies of the plans and the project manual are used, there is typically a limit on the number of sets of contract documents a general contractor may obtain from the architect/engineer, and this limitation is usually specified in the invitation to bid or instructions to bidders.

Subcontractors, material suppliers, and manufacturers’ representatives can usually obtain prints of individual drawings and specification sheets for a fee from the architect/engineer. Still, it should be noted that this fee is rarely refundable. The architect/engineer will require a deposit for each set of contract documents obtained by the prime contractor.

The deposit, which acts as a guarantee for the safe return of the contract documents, usually ranges from $10 to over $200 per set and is usually refundable.

It should be realised that the shorter the bidding period, the greater the number of sets that would be required. Additionally, a large and complex job requires extra sets of contract documents to ensure an accurate bid.

To obtain the most competitive prices on a project, a substantial number of subcontractors and material suppliers must submit bids for the job. To get the most thorough coverage, there should be no undue restrictions on the number of sets of contract documents available.

If this situation occurs, it is best to call the architect/engineer and discuss the problem. For many projects, the owner makes drawings available in computer files, which can be printed or used in estimating software (such as On-screen Takeoff).

This reduces the cost of reproducing the drawings and project manual, making it economical to distribute them to numerous contractors and subcontractors. Often, electronic copies of the plans and the project manual can be downloaded via the Internet.

During the bidding period, the lead estimator must ensure that the contract documents are kept together.

Never lend out portions of the documents. This practice will eliminate subcontractors’ and material suppliers’ complaints that they did not submit a complete proposal because they lacked part of the information required for a full bid.

Some subcontractors and suppliers still prefer to work with paper copies of the plans. The general contractors often set aside space in their offices where the subcontractors’ and material suppliers’ estimators may work.

In this manner, the contract documents never leave the contractor’s office and are available to serve a large number of bidders who want to use paper copies.

Sources of Estimating Information

For matters relevant to estimating and costs, the best source of information is your historical data. These figures enable the pricing of the project to align with the company’s actual construction performance.

This information takes into account the talent and training of the craft personnel, as well as the management abilities of the field staff personnel. Additionally, it incorporates the practices and methodologies of construction companies.

This is why a careful, accurate accounting system combined with accuracy in field reports is so important. If all of the information relating to the job is tracked and analysed, it will be available for future reference.

Computerised cost accounting systems are beneficial in gathering this information and making it readily available for future reference.

Several “guides to construction cost” manuals are available; however, a word of extreme caution is offered regarding the use of these manuals. They are only guides; the figures should rarely be used to prepare an actual estimate.

The manuals can serve as a guide for checking current prices, enabling the estimator to follow a more uniform system and save valuable time.

The actual pricing in the manuals is most appropriately used to help architects check approximate current prices and facilitate their preliminary estimates.

In addition to these printed guides, many of these companies provide electronic databases that can be utilised by estimating software packages. However, the same caution needs to be observed as with the printed version.

These databases represent an average of the methodologies of a few contractors. There is no simple way to convert this generalised information to match the specifics of the construction companies’ processes.

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