When it comes to the process of Estimating Construction Costs, accuracy is a must-have factor. Accurate estimations help with planning and ensuring that the budget will cover all aspects of costs in a project. In construction, many unknown variables can affect a project directly. It is an estimator that assesses the requirement for resources in a project.

To perform instant and accurate estimations, an estimator must be competent. An estimator must have a basic understanding of how the cost is categorized in the estimation process. Primarily, Estimating Construction Costs is categorized as follows:

• Materials 
• Labor 
• Equipment
• Softwares
• Overheads 
•  Contingency cost

Furthermore, an estimator must have all the necessary knowledge of estimating techniques. In construction, each project is unique and requires optimum techniques for a particular project. Several methods can be used in the estimation process.

Use of Techniques for Efficiently Estimating Construction Costs 

After understanding the categorization of costs, now let’s delve into the various techniques that estimators apply to gain instant and accurate estimations:

Top-down Method for Estimating Construction Costs

One of the techniques is known as analogous estimating. This estimating technique is used in the initial stages of a project. When the information is limited, it applies to the overall cost aspect of a construction project—covering almost all cost elements. The top-down estimating technique enables an estimator to assess the overall budget quickly. Thus, it is inevitable that this technique is used in the initial stages of budgeting. This technique also uses historical data from similar projects ( if applicable).

Applying the Bottom-up Technique in Estimating Construction Costs 

This technique is also known as analytical estimating. In this technique, an estimator breaks down each task in a construction project. By dividing a task into more minor elements, an estimator estimates the cost of each single item. To use this technique, an estimator must have complete knowledge of resources. This technique is performed in detail. But simultaneously, it can be more time-consuming. For example, this technique is not feasible for a Residential Construction Estimator because time is of the essence in a residential project. 

Parametric Estimating in Construction Costs

In this technique, an estimator, based on parameters such as the size of the project, complexity, and productivity, estimates the cost. In this technique, work is divided into separate components. Then, by multiplying each component’s price individually, the total cost of a project is determined. This technique is beneficial when a project is similar and past data is available as this technique develops relationships and patterns by comparison of past and present data of similar projects.

Why Opt for the Detailed Estimation technique in Estimating Construction Costs?

As the name suggests, this technique involves a comprehensive evaluation of costs in a construction project. The guarantee of accurate estimations is the greatest feature of this technique. It takes into account all the resources that are associated with direct and Indirect costs. This is done to generate a more detailed and accurate estimate. This technique can only be applied when all the information is present. For example, an expert, while performing Electrical Estimating Services, must have all the information to perform a quantity takeoff.

So, this technique can be applied at the later stages of project planning. Because of detail estimations, this technique will be more time-consuming.

What Technique to Apply in the Initial Stages of Estimating Construction Costs 

In the initial stages, information is limited, so a preliminary estimation technique is used. It instantly assesses the complete cost of a project. Then, it gives a rough overview of the construction estimates. Thus, it tells a professional to analyze how practical a project is and what the budget requirements are. This technique depends typically upon historical data and benchmarks of the construction industry.

Comparative Estimating Technique

It is also known as the empirical costing technique. This is mainly used by estimators in Estimating Construction Costs for a similar one in the past. It considers information such as: 

• Market
• Pricing trends
• Location
• Size of the project.

By using this information from a past project, it provides comparative estimations. As data is derived from a past project. The probability of accuracy and reliability is somewhat higher. This is because historical data provided a reliable reference for estimations. SMA MEP estimate ensures that the proper technique is implemented. Firstly, Experts analyzes the framework of a project. Then pinpoints the most appropriate techniques that are helpful for a project.

Conclusion

In the end, estimations in a project must be accurate and instant, as accurate estimations are necessary in a construction project. It is crucial for an estimator to completely understand all the essential techniques as they are credible in achieving reliable cost estimations. In this article, the most commonly used techniques have been discussed. They ensure that the process of Estimating Construction Costs is instant and accurate.