Understanding Cost Estimating

Construction cost estimating is the process of forecasting the cost of building a physical structure. Of course, builders and clients both worry about the financial impact of cost overruns and failing to complete a project. Clients considering large projects often seek multiple cost estimates, including those prepared by contractors and those calculated by independent estimators. Project owners use cost estimates to determine a project’s scope and feasibility and to allocate budgets. Contractors use them when deciding whether to bid on a project. You usually prepare estimates with the input of architects and engineers to ensure that a project meets financial feasibility and scope requirements.

Different Types of Construction Cost Estimates we offer

Cost estimates are broken down into three categories that serve one of three basic functions: design, bid, and control. To establish a project’s financing, you must start with a design estimate or a bid estimate.

1. DESIGN ESTIMATES:

Design estimates include screening (order of magnitude) estimates, preliminary (conceptual) estimates, detailed (definitive) estimates, and engineer’s estimates. These estimates run parallel with the planning and design of a project.

2. BID ESTIMATES

Bid estimates are submitted to the investor for purposes of competitive bidding or general negotiation. These estimates consider the direct construction cost including field supervision, as well as a markup to cover general overhead and profits. Direct construction costs include subcontractor quotations, quantity takeoffs, and construction procedures.

3. CONTROL ESTIMATES

Control estimates are used throughout a project to monitor costs. A control estimate establishes the budget estimate for financing, the budgeted cost before construction, and the estimated cost of completion during an ongoing project.