Cost planning and control
6. External works
2.2.3 Detailed estimating
2.2.3.1 Detailed estimating: Practice example
After confirmation of the project’s final design and specifications, and com- pletion of component value management comparisons, a detailed estima- tion is conducted.
The six steps to addressing detailed estimates (to finalise a project’s cost parameters) are as follows:
Step 1: Review the preliminary estimate (see Section 2.2.2) and ensure that the finalised preferred elemental design choices reflect a value management comparison of all potential fit-for-purpose specifica- tion alternatives.
Step 2: Ensure that key items have been described in a standard format to reflect civil engineering standard methods of measurement nomen- clature (Section 5.3).
Step 3: Develop from in-house sources, external price books and construc- tion texts, a range of work task gang-hour efficiencies and unit rates for respective all-in labour, plant and material costs; wher- ever possible, validate data by industry supplier quotations and
Table 2.4 Resource by factor
Resource Factors to be priced for all-in costs
Labour Wage/minimum wage, overtime, public holidays, guaranteed weekly earning, bonus payments, tool and clothing allowance, annual holidays, travelling time, fare and lodging, injury and sickness benefits, provident fund contributions, training levy, employer’s liability insurance, responsibility (foreman, ganger, craft/skill rating)
Plant Equipment and machinery continuity/hire/lease/purchase/borrowing costs, time-related costs (cost of fuel, oil), fixed costs (mobilisation cost to bring-to-site and remove-from-site), production rates (output [m3/h] with
related environmental conditions [weather, water, slope]), weight restriction measures, support equipment (slings, chains, skips) Materials Supplier quotations, delivery requirements, trade discounts, waste
allowances, unloading/storage/distribution costs, timing and rate of deliveries, amount to be stored on-site, shrinkage
Other Percentage additions and add-on costs for specialist subcontractor work, overheads, profit and other on-costs
time-and-motion studies of on-site production rates (generally, work efficiencies for method-related tasks might be gleaned from experience or from any available texts).15
Step 4: Prepare a tabulated method statement of the task(s); broken down into respective labour, plant and material components where appli- cable. Overheads and profit are added item-by-item in recognition that each work task has differing associated risks, safety provisions and profitability potential.
To address Operational Health and Safety,16 the National Stan-
dard for Construction Work (Commerce 2011) must be used where all undergo construction induction training in accordance with the Occupational Safety and Health Regulations of 1996 (Worksafe 2009). Stakeholders such as clients (Protection 2007a), designers (Protection 2007b) and main contractors (Commerce 2007) are responsible for exercising the regulations as required.
Step 5: Input costs (based on the data set generated by step 3) into the tabulated work breakdown structure of project tasks (generated by step 4).
Detailed estimates from the client’s design team may be used to input profit and overhead percentages collectively at the end. The contractor’s detailed estimate, on the other hand, might input profit and overhead percentages individually; weighting cer- tain items where increased (early) profitability may exist for effi- cient working practices.
Step 6: Review and update the item descriptions generated in step 2 above. Input the final all-in rates generated in step 5.
The civil engineer now has a detailed estimate for the project. Detailed estimates from the client’s design team may now be used to compare, contrast and choose from a range of builders’ tender submissions, and then choose where each independent bid- der has submitted their price to complete the work tasks using the standard format given in step 2.
The prospective contractors’ detailed estimate, in this sum- marised standard BQ format, may now be used to submit accurate tender-bids, with a clear and objective item-by-item indication of profitability, if successful.
A scenario might involve the detailed estimation of some typical work tasks such as the general excavation of 25 m3, the supply and placement
of 0.12 tonnes of reinforcement bar to in situ concrete and the supply and placement of steel fabric reinforcement to slabs.
Steps 1 and 2
Subelement items in standardised CESMM BQ format are as follows:
Ref Unit Quantities Rate Total
Earthworks
General excavation $ $
E423 Material other than topsoil, rock or artificial hard material
Maximum depth: 0.5–1 m
m3 25
Concrete ancillaries
Reinforcement for in situ concrete
Reinforcement G516.1 Plain round steel bars
Nominal size: 20 mm diameter
To isolated beams, straight and bent, supply and place
tonne 0.12
G562.1 Steel fabric
Nominal mass: 2–3 kg/m2
Welded, nominal side and end laps, supply and place
m2 25
Step 3
Work method, gang-rate efficiency information must be gathered. This must be validated by industry suppliers and vendors, as well as time-and- motion studies to update task performance times.
A data set allows subsequent detailed estimates of BQ task items. Table 2.5 summarises the type of information essential to allow progres- sion towards a detailed estimate of a project’s (method statement) itemisa- tion of jobs.
Step 4
A tabulated method statement is prepared. A method statement is prepared (in preparation for the inclusion of costs) for (i) excavation, (ii) rebar rein- forcement and (iii) mesh reinforcement and is represented in Table 2.6.
Step 5
Taking the work-breakdown structure identified in step 4, and inputting the values generated in step 3, an updated table of task item costs follows (Table 2.7).
Step 6
An updated item description tabulation that now inputs costs (calculated in step 5) into the previously unpriced BQ (prepared in step 2) is presented as follows:
Ref Unit Quantities Rate Total
Earthworks
General excavation $ $
E423 Material other than topsoil, rock or artificial hard material
Maximum depth: 0.5–1 m
m3 25 7.77 194.25
Concrete ancillaries
Reinforcement for in situ concrete
Reinforcement G516.1 Plain round steel bars
Nominal size: 20 mm diameter
To isolated beams, straight and bent, supply and place
Tonne 0.12 2516.35 301.97
G562.1 Steel fabric
Nominal mass: 2–3 kg/m2
Welded, nominal side and end laps, supply and place
m2 25 20.36 509.00
$1005.22
Table 2.5 Efficiencies
Work task efficiencies Unit Labour rate machine ratePlant/ Material rate
Excavate by machine to reduced levels where depths don’t exceed thicknesses of 0.25 m (precise excavation) 1.00 m (less precise digging) 2.00 m (less precise digging)
h/m3 h/m3 h/m3 0.15 h/m3 0.12 h/m3 0.12 h/m3 0.15 h/m3 0.12 h/m3 0.12 h/m3 — — —
Cost/hour of general labourer $ $21.50/h — —
Cost/hour of excavator + driver $ included $36.00/h —
Extra for semiskilled labour for
reinforcement steel fixing $ +$3.50/h included —
Reinforcement
12 mm hot rolled bars 20 mm high yield bars Fabric sheet type
$/tonne $/tonne $/m2 — — — — — — 1350.00 1450.00 11.56 Reinforcement waste Bar
Fabric and lapping %% —— —— 2.5%11%
Steel fixing outputs 12 mm bar 20 mm bar Fabric sheet h/tonne h/tonne h/m2 50 30 0.05 — — — — — — (continued)
Table 2.6 Method statement
Method statement description Labour Plant Material Running total ($/unit)Total
i. Excavate to reduced levels <1 m deep
Labour: … h/m3 output @ $… …
Plant: … h/m3 output @ $… …
Material: —
Safety: nominal temporary earth
retention …
Overheads/profit: 12.5% of… …
… ii. Reinforcement, 20 mm mild
steel Labour: … + skill… =… x… h/t … Plant: — Material: (bar…) + (waste…% =…) Tie wire…kg @… (nominal waste) … … Safety: … Overheads/profit: …% of… … … iii. Reinforcement, fabric with
side laps
Labour: fix mesh output…
@ $… … Plant: — Material: fabric… + (waste…% =…) spacers $…/m2 (nominal waste) …… Safety: … Overheads/profit: … % of… … …
Table 2.5 Efficiencies (Continued)
Work task efficiencies Unit Labour rate machine ratePlant/ Material rate
Tie Wire Tie wire cost
Tie wire for 12 mm bar Tie wire for 20 mm bar Fabric sheet snap-spacers
$/kg kg/tonne kg/tonne $/m2 — — — — — — — — 5.00 0.09 0.10 4.00
Table 2.7 Method statement costs
Method statement description Labour Plant Material Running total ($/ unit)Total
i. Excavate to reduced levels <1 m deep Labour: 0.12 h/m3 output @ $21.50 2.58 Plant: 0.12 h/m3 output @ $36.00 4.32
Material + safety extras: —
6.90 Overheads/profit: 12.5% of 6.90 0.87 7.77 ii. Reinforcement, 20 mm mild steel Labour: 21.50 + skill 3.50 = 25.00 × 30 h/t 750.00
Plant + safety extras: —
Material: (bar 1450) + (waste 2.5% = 36.25) Tie wire 0.10 kg @5.00 (nominal waste) 1486.25 0.50 2236.75 Overheads/profit: 12.5% of 2236.75 279.60 2516.35 iii. Reinforcement, fabric
with side laps
Labour: fix mesh output
0.05 @ $25.00 1.25
Plant + safety extras: —
Material: fabric 11.56 + (waste 11% = 1.28) spacers $4.00/m2 (nominal waste) 12.84 4.00 18.09 Overheads/profit: 12.5% of 18.09 2.27 20.36
The detailed estimate example described above addresses the on-site opera- tional costs (direct costs) of the various work tasks involved in the realisation of a project (more examples of detailed estimating are presented in Chapter 7).
The steps above touch briefly on percentage additions for overheads. Several other additional cost plan inclusions (such as overheads) require consideration to allow a more all-encompassing prediction of project cost. Discussion of these other (indirect cost) items is presented in Section 2.2.4.