Comparing And Contrasting Three Methods Of Approximate Estimation And Navigating The Tendering Process: A Guide For Quantity Surveyors And Consultants

a)Compare and contrast three methods of approximate estimating with reference to suitable examples where the methods can be used.

b) Discuss which Form of Tendering procedure that would be the most suitable for this project.

c) Investigate the procedures you would adopt, as ‘The Clients Architect’,   to vet the suitability of a contractor to tender for and, if selected, manage and construct the development.

2. a) From the enclosed drawing formulate a ‘Take off list’ for the Gables Substructure up to and including dpc, dpm, hard-core, sand blinding, insulation, floor slab and Insulation.

b)From the drawing, take-off all the relevant dimensions and along with the correct descriptions, document manually on dimension paper (to NRM2).  Include Substructure up to and including dpc,  dpm, hard-core, sand blinding, insulation and floor slab (omit the floor screed)            

From the site plan enclosed, consider how many bungalows are the same as the one you have measured. Provide several examples with a brief overview on how the taking off process could be simplified if you were measuring all the properties that were all identical in size.

c)Abstract the quantities from your take off in question 2b and produce a bill of quantities (unpriced) ready to be sent out to tender to prospective contractors.

3. a)  Produce a schedule of rates for the substructure up to and including dpc, dpm, hard-core, sand blinding, insulation, floor slab and Insulation.

b)Design a programme in the form of Gantt chart for the substructure using Excel. (One plot only) Include site set up levelling and landscaping and boundary fencing for this project. Show clearly any activities you believe may extend the duration of the project if they run late.

They are the methods of predicting the contractor’s offer by the Quantity Surveyor or Consultants. The Consultant will try to predict what the contactor will charge in respect of the cost of materials, labour, profit, overheads etc. prediction will be based on available information. In building, costs will be based on past costs. The units of description are taken into account. The methods used relate to those for expressing the unit of measurement of the building- these can be unit rate, square metre, cubic metre, storey enclosure, elemental and approximate quantities.

Comparing and Contrasting Three Methods of Approximate Estimation

Cost estimation has a primary function of producing cost estimates of buildings or civil engineering projects with high accuracy and reliability (Chapman, United States, & Center for Building Technology, 1980). The estimated costs always depend on the available data and information as well as client's requirements. There are various methods of determining the value of a construction project at different stages. The data used in these models are usually derived from historical records of already completed buildings or civil engineering works.

The choice of each of these techniques depends on the following ("Factors Affecting Construction Cost Estimation of Building projects," 2017):

• It's reliability
• Its tolerable level of accuracy
• The speed at which it can give results
• Knowledge and familiarization of the user
• Simplicity when using the method

Functional Unit

This method of estimation is because of the existence of an affiliation between the cost of a constructed structure and the quantity of the accommodated functional units (Bathurst & Butler, 1980). Through costing a single functional unit, rather than say floor area, the designers get area flexibilities, which allow them to choose the quality as well as the quantity of accommodation of the building during design. The functional elements are expressed regarding the intended use of the building. These may constitute for instance: hospital cost per bed, school cost per student space, cinema halls cost per seat, or cars cost per parking space.

This method is considered unreliable since every building is unique because of the following (Seeley, 2003):

• Site conditions
• Price levels set by market conditions at a given time
• Specifications levels variations
• Different access and circulation arrangement
• Client’s characteristics
• Characteristics of the consultants and design team
• Unique features of the construction project
• Procedures of contracting and techniques of tendering

Consequently, these aspects render the method unreliable, similarly to other methods of cost estimation.

This method is used at an early stage when the client needs to know the tentative total cost of the project.

Advantages of the method

• Quick and simple- multiply units by a rate
• Useful for budget preparation

 Disadvantages of the method

• It is not precise and not reliably accurate- eg. rooms could differ in area
• It is difficult to make an allowance for all the factors for there is deficiency in information eg. finishes

Great care should be taken when using the same for estimating. It can be used in estimating cost of schools (cost per child), hospital wards (cost per bed) or hotels (cost per seat).

Functional Unit

This method bases its estimation on the fact that the building cost is much more closely related to floor area (Pica & Montanari, 2016). This method entails measurement of total floor area within, the internal perimeter of walls and is measured over all partitions, staircases, and interior columns.

Where there are no external walls, but instead columns exist, measurement is done from the outer perimeter of the columns. Lifts and chimney stacks are assessed separately, and their cost added as a lump sum.

The advantage of this technique over other methods of cost modeling is that it expresses costs concerning accommodation required. This is more meaningful to the client compared to storey enclosure method. When estimates are needed at the initial stages of a project, sometimes the only available information is floor areas, and therefore it becomes an essential tool (Smith, 1995). However, most of the factors causing unreliability cited under unit method apply as well (Smith, 1995).

Storey Enclosure Method

This method involves measurement of areas of floors between internal faces of external walls, roofs and containing walls, each of which are calculated by differing percentages and the resulting amounts summed up to get the total of storey enclosure units (Smith, 1995). Lifts and other engineering services and external works are measured separately and cost calculated and added as a lump sum.

The recommended weightings are as follows (Smith, 1995):

3. Cellar/Basement  x 3.00

Ground-flooring    x 2.00

1^st flooring             x 2.15

2^nd flooring            x 2. 30

3^rd flooring             x 2. 45

1. Measurement of roof covering is on the plan to the eaves-extremes  x 1
2. The outer walling area    x 1
3. Enclosing wall which is below ground level x 2

The advantage of this method over other cost modeling techniques is that it performs better concerning reliability since it takes into consideration the plan shape and storey height. However, its limitation comes since it relies on weightings, which are abstract.  The costs are represented in terms, which are less meaningful to clients. It requires a lot of information to be of use at the initial stages of the project (Smith, 1995). Besides, the rules do not apply equally to all buildings, and it suffers all the other unreliability setbacks experienced with the unit method.

The construction industry is an economic sector; therefore, money is the primary factor of a construction project. The client is concerned with the selection of a contractor with the best and suitable offers regarding quality and workmanship at relatively low-cost. Consequently, the most appropriate and acceptable tendering method is necessitated. Tendering is the formal, documental, structural, and legally binding process where the client accepts to take part in a formal agreement with the contractor (Brook, 2017).

Floor Area

Negotiated Tendering Method

As a Quantity Surveyor, I would advise the client to consider adopting the negotiated tendering method for the proposed project (house 4). This method of procurement allows only the reputable contractor to get into the contract with the client (Baker, Champrion, & Royal Institution of Chartered Surveyors, 2008).  Besides, a contractor who has a long-term business relationship with the client would be preferred.  

The project of constructing House 4 is small and requires urgency; hence, negotiating with the contractor would be more appropriate since it minimizes cost overrun regarding documentation costs and time overrun. The project is a two-bedroom house, which means that the capitals of the employer may be inadequate or restricted thus adopting other methods of procurement such as open tendering becomes impractical. Moreover, negotiation would be desired since there is a pressing need to commence the work very early on site, so that the tasks may be completed on a fast track basis.

This procurement method may as well be preferred in the following circumstances (Baker, Champrion, & Royal Institution of Chartered Surveyors, 2008):

• Where the contractor is the financier of the project;
• In exceptional situations such as safety motives and reasons of security;
• When it is convenient to procure the facilities  and services of a specific bidder;
• In circumstances when the client realizes that is advantageous to contract  with the      same service provider to carry on with the original or the contract in effect;
• Where it exists of only one contractor or with distinct proficiency or capitals to undertake the construction activities; and
• In circumstances when the client and contractor are in a relationship with owning subsidiary construction firms.

The suitability of the contractor must be vetted to enable the client to secure the best contractor who will ensure that the work progresses as projected and to the highest quality feasible (Brook, 2017). Tendering procedure necessitates an accurate estimate before the tender is advertised ("Estimating and Tendering for Construction Work," 2016). This estimate has to reserved stringently confidential since it would form an essential document to aid in vetting the most suitable contractor.  The criteria of making decisions at any stage should be open, reasonable, and objective with no allowance for discretion particularly in the assessment of the tenders ("Assessing tenders," 2017.)

The prequalification of the contractors is recommended for significantly large and expensive projects (Mulikat Modupe, 2016). However, it assumes the possibility of being more expensive due to lack of accountability and failure to vet a competent contractor. Prequalification is based on professional competence regarding staff and equipment, financial ability, pertinent experience and integrity.

As ‘The Client’s Architect’, I would adopt the following procedures in vetting the suitability of the contractor (Seeley, 1987):

Reception of the Tenders

I would ensure that every contractor who pays the bid bond receives all the tender documents such as a bill of quantities and drawings. Besides, I would ensure that all of them are notified of the deadline of the delivery, where the bid documents are to be delivered, and time and venue of bid opening.

Storey Enclosure

Opening of the Tenders

At this stage, I would ensure that one staff member opens all the tenders for fair and equitable evaluation.  Besides, I would ensure that I briefly note down important points for future reference. These notes will help me make well-informed decision in choosing a suitable contractor.

Reviewing of the Documents

The responsible staff member opens each tender and scrutinizes that the bid is complete and follows all the required the conditions. I would ensure minor arithmetic errors are corrected, and revised amount be used in the evaluation (“Major contract tenders, n.d). Tenders that have not followed the required conditions and those with unreasonable prices will be rejected at this stage.

Technical Evaluation

Valid tenders would be assessed on their technical merits ("Analyzer systems. Guide to technical enquiry and bid evaluation," n.d). The non-price criteria of evaluation will be adopted. The assessment will be based purely on the technical ability of the bidders. The outcomes of this evaluation will be documented before moving to the next stage.

After I have assessed the tenders against the technical merits, I would undertake a financial assessment of the prices quoted (Ashford, 1979). Moreover, the tenders will as well be assessed against the front loading which some contractors adopt when pricing tenders. The outcomes will be documented before moving to the next stage.

After I have separately evaluated the bids against financial merits and technical merits, I would undertake to compare the technical capacity and the quoted total cost to find out the bid that embodies the best-combined bid ("Information and Efficiency in Tender Offers," 2008). This stage will establish the most suitable contractor who can manage and construct the development.

Considering the site plan enclosed, I have noticed twelve (12) bungalows that are identical to the measured one. The process of taking off will be oversimplified if all the properties to measured are similar. This simplicity of taking off comes about since once a quantity or an element is measured; simple multiplication can help get the total quantity of all the similar quantities or elements.  For example, the total volume of trench excavation of tall buildings can be calculated by multiplying the number of the same structures in the timesing column of the dimension paper.

Besides, identical properties simplify the process of taking in the sense that you only need to take off one property. For instance, to get the total quantities, only one property needs to be measured and multiplied by all the identical features. Moreover, elements like joinery fixtures, windows, and doors are quickly taken off by just indicating the number of the identical properties in the timesing column of the dimension paper.

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Ashford, J. H. (1979). Negotiating for a computer: technical evaluation of the tenders. Program, 13(4), 177-185. doi:10.1108/eb046803

Assessing tenders. (2017). Managing Reality: Book Two – Procuring an Engineering and Construction Contract, 21-27. doi:10.1680/pecc.61842.021

Baker, E., Champrion, R., & Royal Institution of Chartered Surveyors. (2008). Tendering and procurement in construction. Coventry: RICS Books.

Bathurst, P., & Butler, D. (1980). Building cost control techniques and economics. S.l.: Heinemann.

Brook, M. (2017). Estimating and tendering for construction work.

Chapman, R. E., United States, & Center for Building Technology. (1980). Cost estimation and cost variability in residential rehabilitation. Washington, DC: U.S. Dept. of Commerce, National Bureau of Standards.

Estimating and Tendering for Construction Work. (2016). doi:10.4324/9781315734699

Factors Affecting Construction Cost Estimation of Building projects. (2017). International Journal of Recent Trends in Engineering and Research, 3(4), 379-387. doi:10.23883/ijrter.2017.3161.rrkha

Information and Efficiency in Tender Offers. (2008). Econometrica, 76(5), 1075-1101. doi:10.3982/ecta6178

Major contract tenders: Factoring local content into the formulation of invitations to tender and tender evaluation for major contracts. (n.d.). Local Content in Procurement: Creating Local Jobs and Competitive Domestic Indu, 105-126. doi:10.9774/gleaf.978-1-907643-42-2_7

Mulikat Modupe, O. (2016). Relevance of Contractors’ Prequalification Criteria to Time Performance of Civil Engineering Project. American Journal of Civil Engineering, 4(5), 225. doi:10.11648/j.ajce.20160405.13

Pica, M., & Montanari, F. (2016). Project Life Cycle Economics: Cost Estimation, Management and Effectiveness in Construction Projects. London: Taylor and Francis.

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Seeley, I. H. (2003). Building economics: Appraisal and control of building design cost and efficiency. S.l.: s.n.

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