Your Complete Beginners Guide from My Build Estimate
What makes the perfect cost estimate?
Is it one that comes in low enough to blow the competition out of the water and guarantee you land that big contract?
Is it one that is high enough to guarantee maximum profits for your business?
How about an estimate that is delivered so fast as to ensure that yours is the first to be seen by potential customers?
Or is it one that is painstakingly laboured over for days on end to guarantee that absolutely nothing is left out.
The truth, dear reader, is that the perfect cost estimate in the construction industry is all of the above, none of the above, and also so much more.
Allow us to elaborate:
The Risks of Getting it Wrong
Pitch your estimate as low as possible in an effort to undercut all the competition, and you run the risk of you and your customer losing money in the long-term, when it becomes apparent that the project is going to cost much more than you estimated.
Price too high in an attempt to squeeze out every last bit of profit, and there’s every chance that you will pitch so far out of your client’s price range that they’ll award the job to a lower priced competitor.
Turn it around at lightning speed, and you could overlook some vital detail or make a mistake which ultimately proves to be your downfall. Drag your heels, however, and that could mean that you miss those all-important deadlines.
Construction Estimates – The Perfect Balance of Cost, Speed, And Accuracy
What we’re really looking for in the perfect construction industry estimate then, is one that expertly balances all the above.
It should be high enough to be realistic yet low enough to be competitive.
It should also be delivered to meet client deadlines without compromising accuracy and effectiveness.
It’s a tough act to get right, especially with so many things to consider in putting the estimate together.
What is Included in an Estimate?
The rule of three plays a big part in putting together an estimate.
Just as it requires a balance between the three factors of cost, speed, and accuracy, an estimate will contain a whole host of elements organised into three major groups:
From the largest sheet materials and most colossal quantities of bricks and mortar to the last intricate detail, every material must be measured, quantified and costed up. This guarantees that nothing is left out, and that the end estimate is as accurate as possible.
Tools and Equipment
Again, everything must be taken into account here. A schedule must also be considered to ensure that any equipment or machinery which must be hired is only hired when it is absolutely needed.
Project Managers can maximise efficiency by making full use of externally sourced equipment for limited periods, thus reducing both hire charges and labour costs.
Speaking of which…
Last but by no means least, we come to arguably the most important aspect of the entire estimating triad: Manpower.
This is where your build estimator will really come into their own, using their years of experience to identify ways that on-site contractors can work most efficiently in order to reduce the time it takes to complete a project without compromising on quality.
This, as you may have guessed, can lead to some pretty significant cost savings on the overall project.
How are Construction Industry Cost Estimates Created?
Again, we’re sticking to the rule of three here, as most cost estimates require a three-step process to get right:
1: A cost estimator first analyses the drawings, details and plans provided by their client and lists every element, every tool, and all the labour needed to complete the project. This is a process similar to taking off.
All materials are measured and quantified, and a schedule of works are created in order to ensure uniformity when going out to step 2.
2: This is where an estimator will take all the documents they created in step 1, and use them in negotiating with their network of suppliers and subcontractors to gather prices together.
3: All these prices, measurements, and data are used to create the final estimate. These are then thoroughly checked over before being sent out to the client.
See how simple it is to order a professional construction estimate from My Build Estimate. Order yours online today, or give us a call now on 03304 048 526.