ELEMENTS OF A COMPREHENSIVE PROJECT COST ESTIMATE

ELEMENTS OF A COMPREHENSIVE PROJECT COST ESTIMATE

A professional cost estimator’s goal is to provide accurate information to the project developers about the planned project's possible costs. When stakeholders have accurate cost estimates then decisions about project feasibility can be made with authority.

·?????Quantity Takeoff:?The estimator will work to develop and accurately identify the correct materials called for in the project. Without an accurate takeoff, the entire estimate will be inaccurate.

·??????Labour Hours:?The estimator will use his experience to estimate the labor hours needed to complete a given project. He will take into account the varying levels of labor productivity expected based on the complexity of each stage of the project.

·?????Labour Rates:?Estimating labour rates begins with a basic wage and benefits estimate for a given craft. This estimation takes into account the burdens of various taxes such as FICA and FUI and includes others that are required by the company itself. The estimator must also take into account the possibility of overtime work and the increased costs associated with these extra hours.

·?????Material Prices:?Estimating materials costs is more complicated than it may initially appear. The cost of a given material fluctuates greatly depending on current market demand and supply, the quantity required, the cost of transportation to the site, and even exchange rates if the materials are to be shipped into the US from another country.

·?????Equipment Costs:?The cost estimator must take into account several factors regarding equipment including cycle times, equipment capacity, and the cost differential that occurs if the equipment must be rented rather than equipment that is already owned.

·?????Subcontractor Quotes:?speciality trades that operate as subcontractors usually complete Portions of the project. Their quotes should include the same careful considerations of labour, materials, and equipment costs as the general contractor.

·?????Indirect Costs: An accurate estimation of indirect costs is critically important in the overall estimate. Land acquisition, permits, design fees, office support, temporary on-site utilities, and mobilisation are just a few items that must be considered to arrive at an authentic estimate of project costs.