Methods Of Approximate Estimation And Tendering Process For Construction

Plinth Area Method of Approximate Estimation

There are various methods of approximate estimation: approximate estimations are undertaken to get an idea (an estimate) of the cost of putting up a structure, such as a building. The process of determining construction costs can be long and complex: approximate estimation enables costs to be quickly estimated using the existing drawings for a structure before the detailed final budget is developed (Brook, 2016). The following three methods used for approximate construction estimation are discussed, and then compared and contrasted

The Plinth Area method of Approximate Estimation: In this method, the construction cost is determined by multiplying the plinth area rate by the total plinth area. The plinth area is determined by multiplying the breadth (outer building dimensions) by the length. The plinth area method is one of the most popularly used methods of approximate estimation and requires careful observations to be made, as well as detailed inquiries with respect to the aspects of labor and materials quantity and quality. Further, due considerations are made for the buildings’ height, the foundation type, number of storeys, wood work, and fixtures to be made in the building. The Plinth Area Method must adhere to the IS 3861-1966 guidelines that requires the wall areas at floor level to be considered during estimates (Neeraj Jha, 2015). The internal shafts for sanitary shafts below 2 square meters, and ducts for air conditioning and lifts. The Barsati area at the terrace level, where Barsati refers to the covered spaced open on a single side, constructed on one side, on the terraced roof and used for shelter in the rainy season. Cantilever type porches are also considered. Using the Plinth Area method, the following areas are not considered in developing the approximate estimates; the Lofts area, domes and towers that project above the level of the terrace, architectural bands, vertical sun breakers, and box louvers (‘Estimation QS’, 2018)

The Unit based method of Approximate Estimates: In this method for approximate estimation, the cost of building a structure is determined through the multiplication of the total number of of units by each item’s unit rate. The units are the functional aspects of the structure; for a hospital, the unit to be considered is the bed, while for an educational institution, the unit to be considered is a single student. The unit rate is arrived at by dividing actual incurred expenditure by the number of units; occasionally, the cost of similar units can be used as well and then divided by the number of units (Clough et al., 2015).

Unit-based Method of Approximate Estimates

Cubical Contents Method of Approximate Estimation:  This method is suitable for structures/ buildings with several storeys and is a more accurate method compared to the other two methods (the unit based and the plinth area methods). The cost is estimated as being the total cubical contents (the building volume) multiplied by a local cubic rate. The structure volume is obtained from the relation

In determining the area, the space up to the walls and excluding the plinth offset are measured. The costs of the cornice, the string course, and the corbeling are not considered (Akinsiku, Babatunde and Opawole, 2011)

With respect to construction, tendering refers to the process of making an offer for carrying out construction works at a stated price, usually a fixed price. For this project, the proposed method of tendering is the traditional Open Tendering Method, which basically involves the project being advertised with as many interested suppliers as possible encouraged to apply. In this method, all qualified and interested bidders make their bids that are sealed and then publicly opened for scrutiny and evaluation. The qualified contractor to be given the works is chosen based on their price and quality metrics, such as ability to meet construction deadlines (Morena, 2010). This type of tender is competitive and aims to get the best value for money. The traditional open tendering method follows the following processes;

Advertisement of the tender: This is where a notice of the tender is placed in the local media, such as the newspaper. The notice of the tender consists of basic information about the tender, such as the title of the project, the location of the works site, the class of contractors needed, the tender document fees, a few particulars about the contract, such as construction from scratch or making extensions, and the date and time (as well as location0 for tender document submission: the submission usually has a closing date.  Once the advertisement has been made, interested applicants can obtain the tender documents (usually after paying a tender fee) and then proceed to fill in their details as per the requirements set out in the tender.

Tender Closing: The tender document has a date and time within which the tender documents must be obtained, duly filled, and submitted. In the event the contractor fails to meet the deadline, the assumption is that they have failed to submit their bid

Validity period of the tender; During this period, the contractors (bidders) are allowed to withdraw their bids if no longer interested in the works. During this period, a consultant can be hired to assess and evaluate all the submitted tenders

Cubical Contents Method of Approximate Estimation

Pre-tender Stage: Once the client decide to, and commit to participate in the tender, they can appoint a consultant for further discussions on the project. The client and the consultant spend time evaluating the period for the construction, the scope and location of the works, as well as the budget to allocate the works, along with project management issues. This is the most crucial stage of the tender, and initiates the next step for the project

tender Evaluation: There are predetermined set of criteria and factors, upon which the evaluation of tenders is done. For instance, some forms of criteria include financial strength of bidders, track record, price, time schedules, and ability to meet emergencies. As soon as the tender documents are opened, the evaluation process starts. A Quantity Surveyor prepares a report describing the findings from the evaluation process, supported by visual features such as tables and graphs, an at the end, after the evaluation, the Quantity Surveyor, together with a consultant, make recommendations on which bidder or bidders are the most suitable for the contract.

Award of tender; based on recommendations of the most suitable bidder, the tender is then awarded and all bidders are notified of the award (for both the unsuccessful and successful bidders). The letter of tender for the award is then created and sent to all participating contractors (Cunningham, 2016).

Negotiations: After the award of the tender, the client or his/ her consultant and the winning bidder can then have a conference/ meeting to discuss finer details and iron out any issues. Further, clarifications can be asked for and made during this period, such as on the modes of payments, the scope of works, rules for making changes to the scope of works, and any other details. The aim is to ensure that once the project commences, there are no interruptions or major changes that can significantly change the scope of the works or result in delays. Once these issues are ironed out and clarified, then a contract is prepared and signed. Once signed on the dotted line, the contract is binding legally for both parties and detail the responsibilities and liabilities of all the parties.

The described tender form and process is designed in order to make sure the works are undertaken in a fair manner and to give the best value for money to the client. The process also ensures fairness in the entire administration of the tender and to ensure that the best contractor with the most competitive offer and best ability is awarded the tender (Cunningham, 2016).

Traditional Open Tendering Method

Contracting for construction usually involves substantial amounts of money and resources, and so, it is important that the client gets value for their money and ensure the highest quality work is done with minimum adjustments or changes. This requires that the contractor is vetted for their suitability for the work, even after a tender is awarded. The fist step as an advocate of the client would be to fully understand the scope of the works and th contract for the works. The details of the works, what is involved, the exact scope of the works, and possible liabilities and responsibilities of each party must be well understood before the advocate can help in vetting the contractor. The contract type, terms, and scope of works will provide a checklist with which to vet a contractor. Once this is done, a time plan is set up, with deliverables and goals that will determine how the contractor is to be vetted. The planning should be precise and once this is done, the next step entails evaluating the licenses and credentials of the contractor. The contractor candidates must be duly registered and licensed; this demonstrates the firm is committed to best industry practices. The tradesmen of the contractor must also be evaluated; this is because they will be responsible for the actual works and the success of the project depends largely on their skills and performance. The skills of the people to undertake the works will determine if the construction works will proceed smoothly without any hitches (‘ARMA’, 2014). The technical trades, such as plumbing, electrical works, masonry, carpentry, flooring, among others have bodies that certify, register, and/ or give credentials to the tradesmen.

The next step will be to inspect the equipment and tools the contractor has access to, or is in possession of; such equipment as excavators, diggers, drills, among others are essential for the construction works and the ability to meet the construction scope and objectives, as well as time periods depend on the quality of the equipment. The equipment must be in good working condition, and their operators be duly trained and certified, with experience, to operate the machines and equipment. The financial status of the contractor also needs to be verified, especially given the substantial sums that could be involved in the contract. It would be a disaster to award a contract to a contractor, and even make a down payment, and then the contractor is declared bankrupt. Further, the contractor must be vetted on any litigations they are facing to determine whether it would be safe to use sch a contractor. Their history of litigations must also be evaluated; if they were taken to court by previous clients or business associates, the information needs to be established to determine the risk of using such a contractor. This is a form of risk management strategy to ensure the works are not interrupted and that one is dealing with a honest and above board contractor.

Advertisement of the Tender

Past works undertaken by the contractor must also be evaluated and inspected, with referrals and comments from past clients being useful in helping to vet the contractor. A suitable contractor should have good references, and be able to demonstrate successful delivery of past projects of a similar scope (Mason, 2016). The contractor must also show detailed plans and schedules for undertaking the works, aided by project management tools: this will determine if they have the capacity to successfully monitor, execute, manage, and deliver the project according to contractual times, within the stated time and budget, as well as scope. Once these have been vetted, the contingency plans put in place by the contractor must also be evaluated. These plans include alternate suppliers for materials and equipment to the contractor in the event their primary supplier is unable to deliver. The contractor is then vetted for their workplace health and safety regulations; the safety of workers and their health at the workplace is a very important aspect as it will ensure safe practices than minimize/ eliminate injuries and fatalities are in place. These are important in ensuring there are no interruptions to work, and that worker safety is upheld at the works site. 

1. Simplifying take Off List

If the buildings were similar, with equivalent measurements, then the take off process can be simplified by using the Cubical Contents method in which the materials required for one building are multiplied by the total number of similar bungalows. To make the process even easier, the building process should follow the RICS NRM 2 approach for making measurements, of which measurements are then fed into a Building Information Modeling system throughout the construction phases. This means that all information, measurements, and materials are entered into the BIM system, starting from the design phase through the entire life cycle of the building. BIM refers to the digital representation of the functional and physical characteristics of a structure and is a shared knowledge source on a facility’s information for reliable decision making. BIM requires that all structures are digitally represented and all aspects incorporated in standard data forms, including dimensions, materials, material specifications, and suppliers, as well as pricing and guarantee/ usable lifespan information (Eastman et al., 2013). Entering this information from the initial phases means that the Quantity Surveyor will only need a suitable Quantity Surveying BIM application to extract the materials take off list, and also schedule their procurement, with prices also relatively easy to generate. The BIM system has been encouraged and widely adopted for use in efficient management of buildings and facilities in the UK (Khosrowshahi and Arayici, 2012)

1. Bill of Quantities (Abstract)

Tender Closing

Te quantities were computed in a spreadsheet, after using the squaring method to determine the area of the building (a single bungalow) and the required materials based on the take off list. These are shown in the table below;

• Schedule of rates

The schedule of rates is developed by multiplying the quantities by the average prices for the materials as sourced from suppliers in the UK where unit prices are multiplied by the total required quantities, in Pound Sterling (£); these are shown in the table below

Delays can be experienced during the phase of seeking out permits and licenses. During the development of the drawings and dimensions, delays can be experienced from redesigns and making changes to design. The excavation and laying down the walls can also be subject to weather induced delays. Placing the concrete slab can also lead to delays considering the curing period and prevailing weather conditions (Crummy, 2012)

References 

Akinsiku, E., Babatunde, S. and Opawole, A. (2011). Comparative accuracy of floor area, storey enclosure and cubic methods in preparing preliminary estimate in Nigeria. Journal of Building Appraisal, [online] 6(3-4), pp.315-322. Available at: https://link.springer.com/article/10.1057/jba.2011.9.

‘ARMA’ (2014). Advice Note- Employing Contractors. [ebook] London: The Association of Residentila managing Agents Ldt, pp.4-9. Available at: https://arma.org.uk/downloader/f1v/2014-07_ARMA_Advice_Note_-_Employing_Contractors_V01.pdf [Accessed 27 Mar. 2018].

Brook, M. (2016). Estimating and tendering for construction work. 5th ed. London: Routledge, p.101.

Clough, R., Sears, G., Sears, S., Segner, R. and Rounds, J. (2015). Construction Contracting. 8th ed. New York, NY: John Wiley & Sons, p.106.Cunningham, T. (2016). Tender Procedure for Traditionally Procured Building Contracts in Ireland. [ebook] Dublin: Dublin Institute of Technology, pp.1-7. Available at: https://arrow.dit.ie/cgi/viewcontent.cgi?article=1066&context=beschreoth [Accessed 27 Mar. 2018].

Crummy, M. (2012). Defending Aganist Cold Weather takes Planning. [online] Concreteconstruction.net. Available at: https://www.concreteconstruction.net/how-to/construction/defending-against-cold-weather-takes-planning_o [Accessed 27 Mar. 2018].

Eastman, C., Sacks, R., Teicholz, P. and Liston, K. (2013). BIM handbook. Hoboken, NJ.: Wiley.

‘Estimation QS’ (2018). Approximate Quantities Method of Estimating (Measurement Groups) Advantages and Disadvantages [Building Construction]. [online] Estimation QS. Available at: https://estimationqs.com/approximate-quantities-method-of-estimating-advantages-and-disadvantages-building-construction/ [Accessed 27 Mar. 2018].

Khosrowshahi, F. and Arayici, Y. (2012). Roadmap for implementation of BIM in the UK construction industry. Engineering, Construction and Architectural Management, 19(6), pp.610-635.

Mason, J. (2016). Construction law – from beginner to practitioner. 1st ed. London: Routledge, pp.141-142.

Morena, M. (2010). Real Estate Propertyas a Tool in Territorial Development. Milan: Maggioli sPA, pp.47-48.

Neeraj Jha, K. (2015). Construction Project Management. 2nd ed. New Delhi: Pearson India.

‘Royal institute of Chartered Surveyors’ (2018). RICS new rules of measurement Detailed measurement for building works. Coventry: Royal institute of Chartered Surveyors, pp.18, 43.

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