What is Analysis of Rates or Rate Analysis of Civil Works?
Every construction project is divided into number of activities. Each activity consists of different types of civil or construction works.
For example, the in the construction of a building, the activities can be excavation or earthwork, Concrete work, masonry work, Wood work such as doors and windows, plumbing, flooring, waterproofing, finishing work such as plastering, painting and distempering.
The Activity earthwork can be divided into many types based on depth and type of soil. For example, an excavation of 1.5m deep in soft soil, an excavation of 3m deep in hard soil. Likewise, concrete work can be divided into many types based on its mix proportions and its placement.
For example, M25 reinforced concrete work in foundation, M30 reinforced concrete work in columns, slabs etc. Likewise, there can be many small civil works in every construction project.
The cost of any construction project is calculated based on each works associated with every construction activity. Thus it is essential to calculate cost of each small works.
Rate analysis of Civil Works or Building Works is the determination of cost of each construction work per unit quantity. This cost includes the cost of materials, labours, machinery, contractors profit and other miscellaneous petty expenses required for the particular work to be complete in unit quantity.
For example, cost of 1 cubic meter of M20 RCC work in slab, Cost of 1 cubic meter of excavation in soft soil of 1.5m depth, cost of 1 square meter of plastering of 20mm, cost of 1 square meter of painting work with specified paint in 2 layers or 3 layers as required.
The cost of materials in rate analysis is calculated as combination of cost of material at origin, its transportation costs, taxes. The rate of labour is based on skill of the labour, such as skilled labour, semi-skilled and unskilled labour. The cost of materials and labours vary from place to place. Thus, the cost of each construction work varies from place to place.
What are the Factors Affecting Analysis of Rates of Civil Works?
Factors which affect the rate analysis of civil works are:
- Specification of the civil work and materials such as quality of materials, proportion of mortar or concrete, thickness of plastering, number of coats of painting, depth of excavation, type of soil etc.
- Location of the construction site – Distance of construction site from source of materials, availability of labours, availability of water, machinery etc. influence the rate analysis of construction work.
- Quantity of materials, number of different types of labours and rates of materials and labours influence the rate analysis.
- Profit of the contractor, miscellaneous expenses and other overheads also influence the rate analysis.
What are the Elements of Rate Analysis of Civil Works?
Elements which constitute the rate analysis are:
a) Material cost inclusive of wastage
b) Labour cost
c) Plant & machinery owning and operating charges
d) Water charges
f) Insurance/ risk coverage charges
g) Contractor’s overheads and profit
Why Analysis of Rates is Required in Construction Projects?
The rate analysis may be required in construction projects for following purposes:
- For the purpose of tendering. In the case of tendering, the contractor may calculate cost of unit work involved in each construction activity for justified quoting of rates. The client may also require rate analysis to calculate the cost of construction project.
- To assess the requirements of quantities of labours, materials, machineries and capital to complete the project.
- To optimise the use of labour, materials and machineries and to know the alternatives to optimize the resources.
- To assess the rate of unit work from time to time for payment increase in material or labour costs or any deviations in work specifications, extra items of work to the contractor.
- To compare the cost of project with the sanctioned capital of the project to take necessary action or regularization of excess or less cost.
- To workout the budget of the construction project and control the cash flows at various stages of construction work.
- To find out the irrational rates quoted by the contractors during tendering process.
- To serve as the basic data in case of dispute among project owner and contractor.