Post on 05-Oct-2020
Estimating
Training for
Construction
Part I
Joe Lopez,
Artessa Building Group, LLC
What is an estimate?
• A prediction of probable cost.
• Is figuring out how to put the pieces together in
the most economical manner.
• It is Predictable Not Random or by Chance.
• No Guesstimating
• Prepared by a skilled and trained Professional.
What is an Estimate in the Construction
arena and why is it the key to Success.
Introduction to Opportunity
Seek, Identify, Track, Follow-thru and
Close-out.
If you are not successful, Learn and Retry
Intentions of Owner (Buyer)
Submission and Obligation of Bidder
Impact on Bidder
Lifeline to success of Company
Can sustain the firm to continue in creating
Wealth or eliminate the firm from existence.
Expose weakness
Vulnerable to take over by competitor
Jeopardize relationships with existing
Owners/Buyers, Suppliers, Financial Institutions,
Sub-contractors, Employees and the fate of the
company.
Most projects are Bonded and all is at RISK
ESTIMATING ART OR SCIENCE ?
Art and
Science
combined
result in the
Best results
consistently
Buyer have responsibilities
Award to the Best and
Most responsive bidder.
Cost, Minimize their Risk,
Best results
Bidders responsibilities
Responsive to the RFP as
offered
Most attractive to the
Buyer
Understanding and
delivering the project on
Time, Under Budget and
meeting the
Specifications.
Plan Review
Bidders responsibility
Identifying all of the facets in the Project
Identifying the RISK for the Buyer, but MOST IMPORTANT FOR THE BIDDER
Required Assets
Labor
Materials
Capital
Talent
Plan
Information
Contingency
If you WIN the Bid are you successful?
Contractors are not in the business of winning Bids
Contractors are in Business to make MONEY $$$$$$$
Great Estimating will establish a good Base for a company's success.
Recipe for success
Skills / Efforts
Software / Program
Electronic / Spreadsheets
Talent
Resources
Review of Job Costing
Review of
job costing
Cost Trends Labor / Materials / Equipment
Hourly / Unit / Assembly
Competition
Organize Team
Estimating Leader
Subordinate
Suppliers
Subcontractors
Review of Job Costing
General depository for Company
Know of all competitors
All cost
All conditions
All Information Should be protected
Collaboration and Teamwork
NOTE:
Examination and Review against ATF
Review in Detail
Utilize all skills
within the
Organization
Bring outside talent
if necessary
PROFITS
Profits should correlate to RISK
Materials (low risk)
Labor (high risk)
Subcontractors (conditionally low risk)
General expenses (low risk)
Expertise in one’s silo (low risk)
PROFITS
Estimating for Profits
Good estimating minimizes Contractors risk and
facilitates Project Management and defines the scope
of work.
The estimate is the roadmap that furnishes the
Company and its field personnel with all the details in
a controlled and prearranged format.
Consistent Profit will keep you in business for
generations
Profit is necessary
Understand all of your cost
Review, Analyze and Forecast Cost against Profits
Blueprint and Construction Documents
File, Track, Save or
Destroy
Acknowledgment
RFI and Addendums
Construction
Documents start from
the Invitation to the
Close out.
Submitting Bids
Confidential and Complete
Your Assets are at risk and exposed
Supported
Staff
Collateral
Team
Estimating Team
Owner
Finance
Management
Struggle to Win
Utilizing all of our skills,
experience, assets & talent
We’ll struggle, then we will
WIN!!
Negotiations and Award
Thorough Estimate
Base Bid
Alternates
Voluntary Alternates
Bids should demonstrate
Mathematically Sound
Thorough Understanding
Comfort the Buyer that you are the Best Firm of Choice
DO NOT BE FOOLED BY THE BUYER
Change Orders
Issued by Whom?
Owner or Bidder
Unknown and unforeseen
Margins
High or Lower that Original submission
Impact to Project
Durations
Resources
Finances
Other Projects, Committed personnel….
Common Mistakes
Cutting prices to beat a rival contractor
Underestimating the complexity of the Project
Expecting an excessive amount of favorable conditions and Change
Orders
Overemphasizing Volume purchasing or a kind Owner
Contracting with an incomplete bid
Scaling drawings
Utilizing unproven subs or suppliers
No back bonding
No unit costing
Not accounting for cost increases
Common Mistakes
Cost of Slow pay
Production rates, calculating the Labor Budget is accurate
Take off omissions
Missing quotes and Guesstimate open items
Crumbling under pressure to procure work
Does not utilize an estimate review procedure
Not updating Materials pricing or trucking cost
Not communicating with suppliers and thinking that they will not
impact you.
Estimating Department is not disciplined in their Sole Responsibility
Handouts to be discussed Part II
Reference Materials and Handouts
A Day in the Life of an estimator
7 Habits of Highly Effective Heavy Construction estimator
Ohio Department of Transportation
www.DOT.State.oh.us
Sample Estimate and Bid Tabs
CSI Masterformat
Where to find corresponding documents
American Society of Professional Estimators, Code of Ethics.
Questions?
Thank You
Joe Lopez
Artessa Building Group, LLC
JoeLopez@Artessa.us
End of Part I
Start of Part II
Estimating
Training for
Construction
Part II
Joe Lopez,
Artessa Building Group, LLC
A day in the life of an Estimator
We all experienced this;
We are not prepared.
Not focused.
No Bid Bond in hand.
Team member did not show up to work, they are not focused, prepared, etc…
Guestimate, for a multitude of weak excuses. It’s not their money, etc…
Relied on Subs to submit their Bids complete and on-time.
Special item that we need pricing on did not come in.
To many bids and you can’t qualify them.
Bid form is difficult, way too many Alternates,
no cooperation and you are over your head.
Bid or Pass? Risk it all?
A day in the life of an estimator 1. Bids every job aggressively
a. Believes each job can be won.
b. Goes for the KILL.
c. Loves the feeling of Winning.
d. Always looking for new projects to bid.
2. Study each project thoroughly.
a. Reads the Specifications, all of the specs.
b. Study the Geotechnical report.
c. Study the General Conditions for Special or unusual conditions.
d. Looks for special schedule considerations.
e. Checks for Tax considerations.
f. Looks early for unusual items that me hard to price or where there are no substitutions.
g. Studies the Addendum (s) and notes the changes onto the plans.
h. Visit the site, Photograph as required.
A day in the life of an estimator i. Build the project in his/her mind.
j. Develops a list of questions and talks to the Architect, Sub-contractor, supplier.
k. Discuss project with in-house Field Staff.
I. Develop a list of value Engineering ideas.
n. Prepare a thorough review of the project for Management.
3. Promote each Project.
a. Send out Solicitation.
b. Talk with Subs.
c. Seek out new Sub contractors.
d. Talk to Management.
e. Seek advice of Superintendents and Project Managers
f. Make sure we are listed in all publications, list, bulletin boards, etc.
g. Keep an ear to the ground for interest in the project.
AMERICAN
SOCIETY OF
PROFESSIONAL
ESTIMATORS
WWW.ASPENATIONAL.ORG Code of Ethics
Do the Math
Know your Math
a. Know the area to be built.
b. Make all takeoffs accurate
c. Take-off as many items as practical
site, concrete, masonry, (all that
you know and understand)
d. Check your estimates against normal
cost or Subs numbers. Qty. & cost.
e. Make sure estimate is set-up
accurately, check against spec. index.
f. Have all takeoff work completed well
before bid day.
g. Have an overall idea of the cost before
bid day.
A day in the life of an estimator
5. Organize Bid Day
a. Have a Division of work allocated ahead of time.
b. Have Scope sheets organized.
c. Make arrangement for extra support.
d. Have all Alternates and unit pricing estimated and filled in.
e. Have the Bond Ready and Signed.
f. Have the Proposal Form filled out in advanced.
g. Have the person turning in the bid thoroughly briefed.
A day in the life of an estimator 6. Put it all together
a. Qualify sub bids thoroughly.
b. Prepare qualifications.
c. Enter the numbers accurately.
d. Submit the bid on time, that means early.
7. Review each project after the bid/proposal is completed
a. Review failures.
b. Review wins.
c. Prepare Bid Book for Project Management.
d. Be careful about making commitments.
e. Develop relationships with subs and suppliers.(even if you did not use them)
MasterFormat Divisions (2004)
MasterFormat was first released in1975 and only had 16 Divisions, in 2004 it was updated and now has 50 Divisions, with 49 & 50 reserved for future.
Division 00 Procurement and Contracting Requirements
Division 01 General Requirements
Division 02 Existing Conditions
Division 03 Concrete
Division 04 Masonry
Division 05 Metals
Division 06 Wood, Plastic, Composites
Division 07 Thermal and Moisture Protection
Division 08 Openings
Division 09 Finishes
Division 10 Specialties
MasterFormat Divisons
Division 11 Equipment
Division 12 Furnishings
Division 13 Special Construction
Division 14 Conveying Equipment
Division 21 Fire Suppression
Division 22 Plumbing
Division 23 Heating, Ventilating and A/C
Division 25 Integrated Automation
Division 26 Electrical
Division 27 Communications
Division 28 Electrical Safety and Security
Division 31 Earthwork
Division 32 Exterior Improvements
Division 33 Utilities
Division 34 Transportation
MasterFormat Divisions Division 35 Waterway and Marine Construction
Division 40 Process Integration
Division 41 Material Processing and Handling Equipment
Division 42 Process Heating, Cooling and Drying Equipment
Division 43 Process Gas and Liquid Handling, Purification and Storage Equip.
Division 44 Pollution and Waste Control Equipment
Division 45 Industry Specific Manufacturing Equipment
Division 46 Waste and Wastewater Equipment
Division 48 Electrical Power Generation
For detail scope and definitions go to:
csi@csinet.org www.ArchtoolBox.com
Ohio Department of Transportation
www.dot.state.oh.us
Pages - Construction Bidding Information
www.dot.state.oh.us/Divisions/ContractAdmin/Contracts/Pages/default.aspx
The Department shall NOT accept, review, hear or consider any bid protest or
construction claims arising from the attached information. In the event that
there is a conflict between the attached information and the bidding
documents, the bidding documents shall take precedence.
Navigate ODOT website
Top Link Bar
•DISTRICTS•DISTRICT 1 - LIMA•DISTRICT 2 - BOWLING GREEN•DISTRICT 3 - ASHLAND•DISTRICT 4 - AKRON•DISTRICT 5 - JACKSONTOWN•DISTRICT 6 - DELAWARE•DISTRICT 7 - SIDNEY•DISTRICT 8 - LEBANON•DISTRICT 9 - CHILLICOTHE•DISTRICT 10 - MARIETTA•DISTRICT 11 - NEW PHILADELPHIA•DISTRICT 12 - CLEVELAND
ODOT Website www.dot.oh.us
•DIVISIONS•CHIEF LEGAL COUNSEL•COMMUNICATIONS•CONSTRUCTION MANAGEMENT•CONSTRUCTION MANAGEMENT/CONTRACT SALES•DIRECTOR'S OFFICE•ENGINEERING•FACILITIES & EQUIPMENT MANAGEMENT•FINANCE•HUMAN RESOURCES•INFORMATION TECHNOLOGY•JOBS & COMMERCE•LEGISLATIVE AFFAIRS•OPERATIONS•OPPORTUNITY, DIVERSITY, & INCLUSION•PLANNING•RAIL COMMISSION•UAS
www.dot.state.oh.us
Quick Launch
•CONTRACTS•ADC CONTACTS•DBE•SUBMIT A PREBID QUESTION•VIEW PREBID QUESTIONS•ODOT PREQUALIFICATION ACCOUNTS
•CONSULTANT SERVICES
Thank You
Joe Lopez
Artessa Building Group, LLC
JoeLopez@Artessa.us