How You Can Deliver Accurate Construction Cost Estimates?

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For construction projects when you submit an inaccurate cost estimate then it can lead to a lot of issues including you losing the project, poor relations with customers, and also financial losses. If you are someone who is related to the construction industry then one thing that you should never do is give or submit an inaccurate cost estimate that cannot be fulfilled.

So, what can you do to deliver an accurate construction cost estimate? Well, for this we have got for you some tips that will help you to deliver precise construction cost estimates professionally:

Build A Construction Estimate Template

To get your estimates right, the first thing that you will have to do is build a construction estimate template and include all the items that you think will be required for the project. Analyze the market and what is the current costs of materials and labor in the market and then you can include all of the things that you think will be required for the project.

Apart from material and labor costs, you can also include other costs such as insurance, administrative cost, logistics costs, etc. Once you have prepared a template, you can add remote items as required since every project has different requirements. Creating a construction estimate template will help you deliver a near precise and accurate construction estimate.

Analyze Past Projects

Analyzing past projects is important to deliver accurate estimates. Whenever you are making a proposal for a project, make sure to review and analyze any similar past projects that you have done in the past and use that to make a more accurate estimate. 

By analyzing the past projects, you will be able to get an estimate of how much cost will be required for a certain project, and depending on the requirements of the current project, you can add or remove items. If you are someone who plays Scrabble and has used tools like Scrabble Word Finder then you will be very good at analysis.

Check Labor Staff Costs & Their Productivity

If you’re a construction project manager or a contractor then it is more likely that you will have your own labor staff, which is ideal for projects but still, to provide an accurate estimate, you will need to find out how productive your labor staff is. Find out how productive your labor is and how much time it will take for them to complete the project. Apart from these, you need to take other things like skillset, training, personal issues, holidays, etc into consideration to get a correct number, just like people consider all the important words when playing a game like Words With Friends.

Then, take into consideration the labor costs, overhead percentage, add your mark-up, and all the other expenses. Once you have taken into account all of the expenses, add them to your construction estimate template. By doing so, you will be able to deliver an accurate construction estimate. 

Check Your Math And Formulas

Once you are done with the above-mentioned, you will need to recheck everything from the start and also your math & formulas. The worst thing that can happen to you while you deliver a construction estimate is that there is a section missing from the template and you unknowingly give an estimate which was missing a whole section. Therefore, to avoid any sort of problems, you will need to check all the required things in the template, and along with that, you will also need to check the math for estimation. 

Since you will be calculating labor costs, and the no. of hours per day or per week & other similar costs, you will also need to confirm and make sure that the formula that you are using is correct. Along with that, you will also need to take sales tax into consideration. These little things, if not done right can cause a huge hassle for you. There are also some softwares available that can help you out with all of this but whether you do it by yourself or use software, make sure that you include all the required things and related costs in the estimate.

These were some of the important tips that will help you deliver near-accurate and precise construction cost estimates. Make sure that you follow all of these carefully and implement these while estimating construction costs.

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