News and Announcements

CPR International, Inc. Issues ConcreteCOST Estimator for Excel Version 3.0. Update includes new reporting functionality and improved custom cost data format. Also includes data updates and Bill of Material report.

ConcreteCOST Estimator Version 3.0 features new functions, features, user interface and concrete construction cost data updates for 2008. New Bill of Material report for material ordering. Several other improvements are implemented.

Five Common-Sense Rules of Successful Cost Estimating

1. A good estimate must start with a complete understanding of scope of work followed by an accurate quantity takeoff. It's all too easy to miss out identifying items of work in the project. This may be due to absolutely mundane reasons such as missing drawings, details or specs. It could be due to a misinterpretation of the scope based on an ambiguous statement or comment. Or, it could be due to a more serious reason such as lack of experience in conceptualizing the work to be performed in the field.

2. Understand your resources and their cost to you – material suppliers, labor force, subcontractors, construction equipment, indirect costs, management.

Easier said than done, this requires a thorough analysis of costs. A cost engineer may very well team up with the comptroller, accountant, field superintendent, project manager, purchasing manager. Even outside labor consultants may be hired to reach cost data to be incorporated in estimates. Remember, such data is not static, but changing in time and periodic review and update is a must.

3. Evaluate your strength and weakness and establish comparative advantage

This is where the upper echelons of management should participate extensively. Typically, they have the background experience not just within the company but with other companies and industries vis-à-vis competition. Once the main parameters are established, the middle management in collaboration within departments may detail out the analysis and attach workable numbers. These, in turn, become the ammunition of choice for the estimating department so that they can come up with an estimate that is not only sufficiently low but also profitable for the company.

4. Determine appropriate Overhead and Profit rates

In order to achieve optimal overhead and profit applications, item 3 above has to be completed so that risk factors are established and evaluated. Considering the general description of profit as being the return for taking a risk, it’s essential that it has to be a calculated risk. To arrive at these figures, not only the company cost structure and records must be thoroughly analyzed but also competition must be evaluated. In general, it is not recommended to trim bid figures from overhead and profit since they represent the long term viability of an ongoing business concern.

5. Use sound estimator’s judgement and keep an open mind and ear

When preparing a bid level estimate, care must be taken to identify not only labor and material cost items shown on the plans, but also labor and cost items that may not be reflected on the plans. This is where good estimating and estimator’s judgement comes into play. It’s allright to consult a project manager, an engineer, a field superintendent and even a simple workman. A few new ideas here and a few there may mean understanding the project better and trimming estimating costs which may in turn mean a winning and profitable bid as opposed to a disappointing loss.

Happy Estimating!