Getting the Estimates Just Right

There used to be an anecdote doing the rounds in the construction industry about the various types of engineering. The story went along the lines as follows.

There were three engineers sitting and talking to each other one day. An electrical engineer, an aeronautical engineer and a civil engineer.

The electrical engineer stands up and says “my type of engineering has to be very precise because in our type of business if the connections don’t match up completely and electricity can’t flow nothing will work and so we have to make sure things to match up exactly.”

The aeronautical engineer stands up and says “my type of engineering has to be very precise because if the aeroplanes aren’t designed properly and cockpits accurately sealed then at 30,000 feet, pilots will collapse planes will crash and so we have to make sure things to match up exactly.”

The civil engineer stands up and looks at the other two and says “in my business we build large buildings and major projects. We just try to make sure that we can match things up to each other as close as we can!”

Now it doubtful as to the exact accuracy of the story but one of the things it does go to illustrate is the need within the construction industry to get estimates as accurate as possible and to allow your self as much flexibility as possible.

A construction cost estimator knows that there are a lot of expenses that need to be tracked when estimating a job. Many people who have been in the industry for a long time have always relied on pen, paper and a calculator to estimate a job. They feel that their experience in estimating out weighs the convenience of the new software programs. However, what they do not realize is that using this software can save them a lot of time and headaches.

There are a lot of costs that have to be considered when estimating a job. Both the seen and unseen cost can delay a project if they are not calculated correctly. Land acquisition, as well as assembly, holding and improvement are just a few of the things that need to be taken into consideration. Others include Planning and feasibility studies of the structure; capital costs for a construction project are just a few of the costs that need to be considered.

You will also need to take into consideration the financial fees, which include filing fees and architectural and engineering design. These factors need to be taken into consideration before you can estimate any other part of the project. When you have these numbers, you can then go on to add the construction cost, labour and materials, insurance, taxes equipment and all of the other factors that will make up your bid or proposal. You have to take into consideration that maintenance costs will be a big part of your expenses. It is critical that you account for all maintenance costs in your estimate. This includes the operating staff, land rent, periodic renovations, labour and material for maintenance and repairs, insurance and taxes, financing costs, utilities.

There will be other expenses that you will need to deal with as they pop up, however, with the estimating software; it will not be a problem.