Importance of Commercial building cost estimationApril 23, 2019
From the recent studies, it has been identified that most of the construction projects don’t end up as they planned at the beginning. The mistakes done with construction estimating plays a major role. If you are engaged with construction estimating, it is important for you to have a clear understanding about these mistakes. Then you will be able to take appropriate steps to stay away from committing those mistakes.
Here is a list of top 10 mistakes that people do with construction estimating.
- Last minute changes – After taking a lot of time to arrive at detailed cost estimations, people do last minute changes. These last-minute changes can trigger a lot of errors and people will end up with incorrect results. They have the ability to create a negative impact on the overall profitability of the project. Since the changes are done in the last minute, people don’t have time to double check and verify them as well.
- Lack of transparency – According to quantity takeoff tutorial PDF, the estimate should indicate a top-level view of the entire construction project. In addition, it should contain granular level information as well. Then you will be able to overcome the black box approach. Failing to do this is one of the biggest mistakes that people do.
- Limited project view – When you are engaged with cost estimations, you should get a clear view of the project. But if you don’t see the different aspects of the project, you will not be able to estimate accordingly. To make the life easy for you with it, you need to make sure that the data available in the spreadsheet are properly filtered and regrouped to display appropriate information accordingly.
- Failing to estimate successive risk – While you work on construction project estimation, you need to pay attention towards risk estimation as well. Then you will be able to determine all the uncertainty factors and the risk. However, many people ignore this while they work on estimates. That’s why you need to get a clear understanding on what is construction takeoff and make sure that you don’t ignore the vital factors such as risk.
- Not following a top down approach – You need to follow a top down approach while you estimate the costs involved in a construction project. Then you will be able to deep dive into the granular levels accordingly and calculate the expenses. But when you start from the granular level, you will miss out those factors and you will end up with frustration.
- Failing to allocate the resources accordingly – You should also be careful when you are allocating the resources accordingly. You need to invest more in the areas that can contribute a lot towards the overall cost of the project. Failing to do it has been identified as one of the biggest mistakes that people do when they work on estimations.
- Pursuing every project – it is completely natural for you to be tempted and pursue every opportunity that comes on your way. Then you will be able to expand into new areas as well. However, you need to keep in mind that new opportunities come with a lot of additional work as well. This can create a negative impact on the profit margins that you will be able to get at the end of the day.
- Not following proper margin calculation algorithms – When you take a look at a sample of bill of quantity for construction, you will notice that appropriate margin calculation algorithms are being used. But most of the people base profitability of the project entirely on the flat sale price. Hence, they end up with discrepancies in the final figures that they get at the end of the project.
- Underestimating the labor expenses – This is one of the most common mistakes that is done in the construction estimating. Calculating labor costs cannot be considered as an easy thing to do. That’s because you will need to pay attention towards a variety of factors when calculating the labor expenses. Therefore, you shouldn’t just calculate the hourly expenses of one employee and multiply it by the total number of employees. You will need to take all associated factors into consideration.
- Focusing only on the strengths – Last but not least, you need to make sure that you don’t just focus on the strengths. For example, you will be really good in roofing. Therefore, you will be able to do the roofing cost estimations really good. But this doesn’t imply that you will be able to do a perfect job when estimating all the expenses associated with the construction project. You need to pay attention towards your weaknesses as well and work on them.