Estimation

Construction estimating is the process of forecasting a project’s costs. However, true project costs are only known once the project is completed. There are several types of construction cost estimates. There are two main ones: preliminary (budget) cost estimates and detailed cost estimates. Many times, an architect will solicit budget estimates from contractors or independent estimating firms to help their client determine if the project can move forward. A good estimate prevents the contractor from losing money and helps the customer avoid overpaying.

The purpose of an estimate has a different meaning to different people involved in the process. To the owner, it provides a reasonable, accurate idea of the costs. This will help him or her decide whether the work can be undertaken as proposed, needs to be modified, or should be abandoned. To the contractor, it must provide the cost of materials and labor to install the project as well as make a profit.

Accurate estimating is the foundation of profitable contracting. Accuracy must be based on several factors. The estimator must understand the type of construction, the project schedule, availability of skilled workers, and the construction sequence to produce an accurate estimate.