The construction industry has a myth going around. The myth is that there is a secret to estimating. Well, the myth is misleading; there are actually nine secrets to estimating! I am about to divulge to you these nine secrets. As a part of this, I am breaking a decades-long, perhaps eons long, silence as to the true secrets of successful estimates. Let the reader beware – this information may cause you to question other myths in your life!
FIRST SECRET
The first secret to be divulged is the importance of the takeoff process in a successful estimate. A successful estimate has its foundation in a reliable identification of the quantities involved in the project. Just like a house, if the foundation is no good the house will fall. It does not matter if the estimate is a feasibility level estimate or a bid level estimate, the quantities identified must be correct for the project.
When preparing a feasibility estimate, care must be taken to identify all of the major and minor cost items in the project scope. Whether on a square footage basis (or other parametric method), or a method that uses material quantities, if you do not identify all of the scope you cannot begin to develop a reliable budget. For example, a general guide for building construction would be to use the CSI sixteen division format at levels 1 and 2 for a scope review during the quantity takeoff period. In the concrete division (level 1), one could identify the need for concrete on the project. Once this has been identified, sub-sections (level 2) could be refined further to consider items such as pile caps, continuous and pad footings, grade beams, slabs on grade, elevated slabs and equipment or housekeeping pads. By considering these areas within each of the divisions, a series of quantities can be established that will form a firm foundation for a reliable estimate.
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. For example, on a plumbing or piping system it is not good enough to only count the linear feet of pipe by size and material type, number, sizes and types of fittings, valves and hangers, etc. An estimator needs to consider the impact of specifications concerning testing, inspection and start-up activities along with the location of the work. This necessitates preparing the estimate by system and, perhaps, by area of the facility. Each system would contain its own listing of materials to aid in determining the amount of time and materials for testing and related. By identifying the systems, a reasonably detailed schedule and control budget can be developed for the construction period without a large amount of time wasted in their preparation.
Will the takeoff be perfect? “No.” There are too many variables to make any takeoff perfect. However, it will be very reliable whether it is at the feasibility or bid phase of the project because the scope of the project has been identified. That is the first secret of estimating. No one company has a lock on this secret; all of the successful firms know one of the secrets to a successful project is having a reliable takeoff.
Don’t miss out on the remaining secrets! Check back soon!
