Construction estimation is the process of forecasting the project cost wholesomely. It is termed to be the critical phaseof the construction process, by which the contractors and builders get assistance in determining the right budgetary limit for a project and so allocating resources. What do you think a proper estimation can do? It acts as a salvaging factor from multiple ends. Therefore, it avoids cost overruns, makes sure of desired project accomplishment, and makes the bottom line better.
Nowadays, many techniques for construction estimation are in practice that holds an important part in project management. A construction estimator or a project manager works tirelessly for the alignment of project constraints. Many questions arise in their mind prior to making the estimates. You must be eager to know about those. These are:
- What is the total scope of the project?
- Which method is appropriate for the estimation?
- What could be the total time for the project completion?
- What resources a particular project may require?
- How much a project can take from the pocket?
- Are there any contingencies that might occur during execution and can cause delays?
However, to cope with all these constraints, there is a need to have the right tools and techniques for project cost estimation to ensure 100% accuracy. In this article, we have accumulated some of the top-ranking tools and techniques for construction project estimation that has worked up excellently in the previous estimates.
Leading Techniques for Estimating Project Cost
- Historical Cost Data Analysis
This method of estimation falls among the basic practice used invarious construction projects. The mechanism follows the cost analysis of the previously completed projects to determine the cost and budget of the currently running project.In this, data collection sources can vary. For instance, the collected information may relate to the completed project of the same contractorin the past or through the reference that is available publically.
- Bottom-Up Estimation
A well-known technique i.e., bottom-up estimation is the core of cost estimation. In this, the whole project is broken down into individual units. After doing that, the cost estimation of every single unit is jotted down and then the all units’ costs are accumulated to ascertain the total project cost. The bottom-up method is a time-taking one but ensures an optimal level of accuracy. It also enables getting comprehensive cost data about each component of the project.
- Parametric Cost Estimation
Parametric cost estimation is a statistical approach to cost estimation. It comprises the data coverage of past projects to form a calculative model for estimating the construction project cost. The method takes in the consideration of certain variables like square footage, material, location, and labour to determine the overall budget. It passes through a seamless process to give a rough estimation, hence proves as a good source of preliminary budgeting.
- Expert Judgment
Expert judgment, as the name implies, works on the basis of a sound experiential background of the construction estimator. The knowledge and technicality of the construction professionals laid the foundation for construction project cost estimates. It is not a widely used approach and its need arises only if there are very fewer data available on similar types of projects. The estimator must absorb a firm understanding of the construction industry and the factors that can interfere with construction costs for high efficiency.
Effective Tools for Construction Project Estimation
- Spreadsheet Software
Spreadsheet software, like Microsoft Excel, is a helpful tool for estimating costs. It requires the estimator to draft a thorough and structured budget for the project. Likewise, it allows complete tracking of each component’s cost. Excel provides an array of tools for data study, comprising pivot tables and charts, therefore, making trend analysis and decision-making straightforward for the estimator.
- Project Management Software
Project management software in the form of Microsoft Project has made construction cost estimation a piece of cake. In this, the estimator can indulge in comprehensive scheduling of the project, tracking project advancement, and performing resource management. This tool offers an absolute cost analysis through cost breakdowns. As a result, the estimator can enjoy staying on top of the project budget.
- Cost Estimation Software
Cost estimation software, for example, ProEst or PlanSwift, is specifically designed for the purpose of estimating construction costs. This tool encompasses multiple features of cost databases, parametric cost techniques, and project management elements. Cost estimation software is particularly introduced to assist project managers and construction estimators in the matter of evaluating residential construction estimates and commercial project costs with a high degree of accuracy.
- Building Information Modeling (BIM)
This tool represents the construction project digitally that consists of details about the construction process, building structure, and material for use. Estimators use BIM for estimating the cost of complex and huge construction projects.
Construction cost estimation is a significant partof the construction process, that requires exact tools and techniques for construction project cost estimation. Undoubtedly, this paves the path for the success or failure of a project.