Home » BIM news » Construction Estimating

Construction Estimating

Bill of Quantities: What is it? Who uses it and how? Here’s the complete guide regarding this interesting field in the construction industry with examples and a powerful software.

A Bill of quantities is a document by which it is possible to estimate the cost of a construction project (or part of it) or for its maintenance.

In addition, its use is widespread in private works as a contractual tool for regulating the relationship between Client and Contractor.

A very important document prepared by the quantity surveyor on the basis of a project and used by all parties involved in the building’s development.

Based on the information contained in a Bill of Quantities, the project commissioner can:

  • plan the investments required for the development of the project;
  • form a Request for Proposal inviting interested companies to place a bid for project completion.

With the reliable data provided by the Bill of Quantities document, the company can:

  • propose an offer for the completion of works according to the project specifications;
  • determine and analyze the conseguent material requirements for site organization.

Looking for an online construction cost estimating software? Get started for free

Main differences between a Bill of Quantities and a Cost Estimate

Although in current practice a Cost Estimate is considered a single document, this is considered as the “fusion” of two distinct documents:

  • the bill of quantities, determines the quantities of the various work sections involved in a project;
  • the cost estimate, is the economic value of such quantities and the estimated total cost of works.

Figure 1: Flow chart of a Cost Estimate document

At this point it’s clear that we can’t draw up a Cost Estimate without first defining the relating Bill of Quantities. The Estimate is in fact obtained by combining the calculated material quantities with specific unit rates.

Bill of Quantities

example of a bill of quantities

Figure 2: example of a bill of quantities

A bill of quantities is composed of an ordered structure of measurement data organised according to the various work sections necessary to complete the project as described in its specifications.

The amounts allocated to each work section are justified by geometric formulas and that’s why a typical BoQ document provides the appropriate columns for entering the appropriate dimensional values, such as, length, width, height/weight for each measurement description; a further column identifies the number of equal parts that are being considered. Of course each of these measurement values can be the result of a geometric calculation and the application of formulas.

In some cases, a Bill of Quantities document may only have one column expressing the total quantity. This is quite useful for knowing the exact quantity in terms of requirements for a specific job.

Construction estimating

layout of a construction cost estimat

Figure 3: example layout of a construction cost estimate

A Construction cost estimate is the result of an analytical process aimed at determining the economic value of a given work section or job, by multiplying the total quantity with the corresponding item’s unit rate. This result represents the the partial cost for each job. The sum of all of these products determines the total cost of the entire project.

The Cost estimate document has additional columns where the unit rate can be entered and where the relating total item cost is shown, compared to a Bill of Quantities document where these columns aren’t used.

How to prepare a Cost estimate

To draft a Cost estimate, the quantity surveyor needs to follow a logical process divided into various stages:

  • job classification (work sections)
  • metric data (measurements)
  • assessment of unit rates (price lists and rate analysis)

The first phase is the “job classification” into homogeneous work groups: the aim is to uniquely associate the qualitative description of the work to its precise quantification (measurement) and its unit price (price list).

The second phase is quantity takeoff which consists in evaluating the right quantitities for each job necessary for construction and aimed at making each measurement simple and also “provable”.

The third phase is the assessment of unit rates and consists in attributing to each job, described and measured, a unit rate. Unit rate assessment can be deduced directly (price books and price lists) or analytically (rate analysis).

Job Classification: Categories or work sections

The purpose of classification is to breakdown planned works into elementary physical parts, with their own logical, technological or functional identity relatable to the whole construction production process.

The starting point of this process is, of course, the Project prepared by the Designer. Usually, during the BoQ drafting, the designer builds up specific groups of work, making consultation easier and adding graphical references relevant to project itself. This kind of organisation also serves well in terms of reliability and precision when addressing the construction cost management and financial monitoring aspects.

Job classification in categories is best suited when drafting a cost estimate because it forms a direct correspondence between the classification elements (categories) and physical elements of the project putting them in relation with the production process.

Let’s now take a look at an example of a possible subdivision into work sections for a typical building. In this case study, we’ll start from the sub-structures and the relating earthworks, then continue with the foundation works, the load bearing members, walls, floor slabs, roof structure, cladding works, leading to the fixtures and all technical installations.

The resulting sub-division will be something like this:

  • earthworks;
  • foundation structures;
  • super-structures;
  • curtain walls and partitions;
  • plaster, floors and walls;
  • fixtures, iron works and similar;
  • external works;
  • plumbing and sanitary equipment;
  • electrical installations and lifting;
  • air-conditioning system;
  • fire safety system.

The designer can of course adopt a higher level of detail by increasing the numebr of categories (for example, by setting up individual categories for “plaster, flooring and cladding” instead of having a single category:

  • plaster
  • flooring
  • cladding

This is of course only an example shown in order to illustrate the general criteria for identifying such categories. In fact, each kind of project and relating job types will have their own optimal organisation into categories.

Once the entire project has been neatly classified, it is then possible to start preparing a list of articles that represent the parts engaged in the conventional measurement phase.

Each article, or item, forming the Construction cost estimate’s Price List, is formed of the following:

  • item description, that defines in detail the measurement subjects to which the article refers to
  • the unit of measurement, (surface, volume, parts, etc) directly related to the kind of building element being considered

Job Measurements: techniques and measurement standards

The objective here is to determine, by means of acquiring the relevant metric information, the quantities of the elements constituting the necessary works as defined in the project.

In order to make the measurement simple and provable, use is made of:

  • measurement techniques, measuring in-line, over all, total volume (i.e. inclusive of dead freight), and so on.
  • measurement standards, geometrical or physical quantities, measurement methods, case studies, etc.

which are better expressed in the cost estimate.

Unit rate assessment (price lists and price analysis)

The Price List with the various unit rates is a project document and forms part of the contract containing the unit rates used in the preparation of the bill of quantities and deduced from regional Price Books

If the reference price book doesn’t contain all the items as provided for in the project, new rates have to be defined by building up elementary items that form the new unit rate. This operation is called Rate Analysis.

Each item is identified by an ordering number (rate code), a description of its constructional and technical features, a unit of measurement and of course by a unit rate.

When drafting the cost estimate, the same tariff order as the reference price list is used.

Price Books (direct assessment)

With this method, unit rates are directly acquired from regional prices normally available online or from authorised publishers.
Price Books provide the average rates with reference to ordinary work execution conditions (building site, site accessibility, working conditions and organization, etc.).

Construction estimates and use of software

An AI estimating software, with the use of an appropriate technology, must conceive the processing and input of metric data not only as a means of obtaining a project document but as one of the design aspects part of the project itself.

When drafting an estimate, the surveyor needs to have all the operational freedom possible to be able to insert, delete, acquire data from other projects, add prescriptions and even media notes, etc.

So rethinking everything done so far and re-propose it in a different way must be simple and fast.
In relation to what has been said so far about the criteria for identifying the work categories, it is essential that the cost estimate program accompanies the surveyor adequately in identifying and determining these elements.

It is important to see a certain organisation and sub-division into levels or categories. A structured document that allows the reader to immediately see amounts and rates of each of these groupings, is definitely an important requirement as it also gives a clear overview of the project proposed for public tendering procedures.
Another aspect crucial to the design phase is also how data editing is managed.

The assignment of a new job type to a category, measurement changes and even the removal of an entire category should result in an immediate change throughout the entire BoQ or estimate document.
The possibility to have a history of changes, made to the document, and stored in temporary printouts can be a great feature for comparing different solutions so as to choose the best and most suitable version of the estimate.

Ultimately we must observe that in order for the software to be really useful in preparing a bill of quantities or an estimate, it must provide adequate operational freedom to the project definition needs so choosing the right solution in response to specific needs but also high levels of productivity, must never be underestimated. This obviously represents added value to our work and the economic investment.
A professional solution should always be updated in time so as to always maintain the high quality standards and ensure data security too

Click here to download PriMus. ACCA’s cost estimating software