MT Projects Controls Corp - Project Management, Scheduling - Miami, FL - USA

Role of Estimating in the Construction Industry

I thought that is going to be interesting to post and answer at one question taken from one of the groups on LinkedIn that sounded exactly like that:

“What is the difference between budgeted (cost or manhour) and estimation, and on what bases does budgeted (cost or manhour) is calculated against the estimation once the project is awarded.”

“Estimates serve a number of functions in the construction industry. In the early stages of a construction program, the owner needs an estimate of the probable cost of construction. This conceptual estimate has to be prepared from a minimum amount of information because it is required at a time when the project is often little more than a vague idea in the mind of the owner. Once the design of the project is underway, budget amounts can be established for the various elements of the project. When the design is completed, a final pre-bid estimate can be compiled to anticipate the contractor’s bid price for work. If this estimates is accurate, the obtained bid prices will be within the owner’s budget for the project. Most contracts that transpire in the construction industry results from competing bids from contractors to suplly goods and services to meet certain specification for a stipulated sum of money. Estimates are also required after work starts on the project. In the cost control programs, estimating is required to facilitate the control of expenditure of funds on a project.”

 

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