The Types of Estimates Used in the AEC Industry
Construction cost estimates involve the forecast ballpark figures surrounding the total cost of building any physical structure. Regardless of whether you are a contractor or the property owner, having a clear and accurate estimate about time and costs expected to incur during the process resolves the worries about failure to complete a project due to the financial impact of cost overruns.
Apart from determining the feasibility or scope of the project, these cost estimates also help allocate budgets, prepare competitive bids, and prevent significant losses for both parties, the builder and the client.
These estimates are one of the core components of construction project management. They help track the earned value management and the project’s performance against the total cost and time variables.
#1 Preliminary Estimate
This type of estimate provides an approximate cost, calculated at the conceptual stage with limited information, especially in cases where project specifications or drawings are not readily available.
Preliminary estimates are used in constructions, renovations, and demolitions, but since they are mere forecasts by experienced estimators, the anticipated costs sometimes vary, depending on the skills of the estimator and the information available about the project.
#2 Detailed Estimate
Containing incredibly detailed information, a detailed estimate is typically drawn when the scope of the project and other minute details are better known. They are known to be precise estimates as they include detailed information about rates, quantities, and costs of each item needed to complete a project.
The process usually starts once the shop drawings are complete and the competent administrative authority has approved the preliminary estimate. After a detailed estimate, contractors can figure out the project’s final cost and whether the cash flow needed to proceed is adequate or will require additional financing.
#3 Quantity Estimate
As a core part of every project, quantity estimates comprise a detailed list of all materials required for a project’s completion. The primary purpose of quantity estimates lies in giving the contractor or client a comprehensive list of items with the pricing details to determine the total cost for each quantity.
The costing detail is multiplied by the dimensions specified in the project drawings by the cost for the particular material needed to obtain an accurate figure.
#4 Bid Estimate
The key purpose of bid estimates is to calculate the overheads, costs, and quantities at a price, which, when the client submits, helps them outbid competitors leading to them winning the project. Sometimes, these bid estimates are based on the clients’ plans, while others are primarily drafted according to standard industry costs.
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Traditional estimates involve a lot of guesstimating, but our highly skilled personnel can make the process a lot easier, faster, cheaper, and eco-friendly!
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Contact us to learn more about our pricing solutions. Our top-notch services are available for clients globally, but mainly in the USA, the UK, Republic Of Ireland, Australia, New Zealand, and The Middle East.