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Project planning and budget estimation is very important for a construction project to be successful. If you don’t plan your project beforehand, you will miss out on minor details and this will impact the budgeting process.
In case you feel budgeting or construction estimation is not that important, think again. Without the project estimation, you will not be able to know the amount that you need to complete the construction project.
One of the biggest fear is that you can run out of money during the project which means you will be wasting time, bleeding money, and eventually this will lead to halting the project.
To make it easier for the project manager and the other team members to get along with each other, budgeting plays a very important role. For construction estimate to actually work, it should be accurate, you don’t want to overestimate the budget or neither make it too short that you end up not foreseeing how much more you will need.
If we look at the takeoff process, the biggest mistake that most people do is to miss out on details and just focus on the raw material and labor cost. This eventually leads to big gaps in budget and the project manager never knows where he is losing money.
So, If you outsource the estimating services for construction, it is very important to keep an eye on the raw material, labor cost, project closeout costs, risk factors, and market fluctuations, etc.
7 Tips to Prepare Accurate Construction Estimates
To resolve this inaccuracy issue in construction estimates, here are few tips that can help project managers, quantity surveyors, estimators, etc. in preparation for accurate estimates.
1. Keep Eyes on Details
Detailing is very important, this is where you can differentiate an estimation done by a professional and an immature. While estimating the construction project, you have to keep in mind all the necessary items and components that you will be requiring.
This includes breaking down the construction project into small activities so you can calculate how much time it will take to complete each activity. It also helps in estimating the labor cost and the material costs which will assist in the overall estimating process.
With details like the possible staffing cost, utility, and operation cost, the project manager is not only able to run the project smoothly but this also helps in managing the overall budgeting and reducing cost by bulk buying and advance booking.
2. Don’t Miss Out the Risk Factor
Risk factor means the percentage of the budget that might fluctuate during the project. This might be due to loss of material, any mishap, any event, or delay in the project causing extra spending on the labor cost.
As the future cannot be predicted, the risk factor will get your project running even if the market price fluctuates or any potential complication occurs in the process of the construction.
Usually, immature estimators, miss out on this process because they think this is the profit base and for personal projects it is not required, however, this is not true. The risk factor is equally important for both personal and professional based project done for bidding.
3. List down the Raw Material
No matter you are immature, beginner, or professional, listing down raw material is vital. Usually, material prices fluctuate and it impacts the overall project budget. So with the help of listing of raw material you need to see what you can buy in bulk to avoid such issues.
This usually happens when the construction material is in high demand and this also dictates if the construction project is executed in a particular season. The best practice is to buy the material in offseason so you have enough material to carry out the construction when you require it.
4. List the Timeline
The timeline of the project is very important, you don’t want to go overboard with anything when it comes to the timeline. This also helps in figuring out what can possibly happen if there is a delay due to weather conditions.
With delays, the cost is linked which means due to the unavailability of any material if the project stops, the rented machinery will still be considered paid for. Even if there is a seasonal limit, it will also be considered within the project timeline.
5. General Operations Cost
Apart from the overall cost, there is always a general cost that comes with the equipment that you will be required to have or any supporting goods. This also includes the expenses that you will be doing at the construction site.
In case you have never carried out a construction project before, this is something that you must consider.
6. Finishing Cost
While estimation is being carried out, immature or beginner estimators usually don’t understand the importance of finishing cost. With raw material and labor cost you can have a grey structure building but with the finishing cost you will finally have a building with good aesthetics.
Normally the finishing works include painting cost, sanitary material, fixation prices, glasswork, woodwork, etc.
7. Staffing Cost
In most cases, labor cost is calculated without staffing cost. For beginners it is important to understand labor cost will just cover the site workers, this will not include other staff members that you will require for the project.
You will require an architect, project manager, designer, delivery guys, drivers, lifters, and other people that can assist you in the project. This is the only way you will be able to accurately estimate a construction project. So, staffing cost is quite important.
With the help of these tips, you can have a better grip over the overall construction estimation process. This will help you to reduce your mistakes as much as possible, however, this is not an alternative to professional estimating services for construction.
Most professional companies not only use the manual but also the automated process for the project estimation. They have skilled professionals who are educated and experienced enough to compare and fill the gap between both manual and professional costs. This helps in making the cost estimation process as accurate and reliable as possible.