Estimating for Heavy Construction and Unit Price Bids

Estimating for Heavy Construction and Unit Price Bids
Hal Johnston Faculty of Civil Engineering Department of Economics and Management CZECH TECHNICAL UNIVERSITY IN PRAGUE

Short Bio Hal Johnston Professor (20 years)
Construction Management Department California State Polytechnic University (Cal Poly) San Luis Obispo, California, USA Professional Construction Experience (17 years) Bechtel – EPC/CM Morrison Knudson – Design Build/General/CM The Austin Company – Design Build R.E. Bayley Construction – General Contractor Mason/Johnston General Contractors – General Education B.S. in Building Theory and Practice – Washington State University Masters in Building Construction – University of Florida Other 2 books, many scholarly papers, given many professional seminars Latest seminar for the ASCE – Atlanta (2 days)– Fundamentals of Construction Estimating And ASCE – Panama (Panama Canal Authority – 10 days) Const. Estimating Short Bio

Learning Outcomes for (Estimating for Heavy Construction and Unit Price Bids)
The attendee will be able to: Discuss how heavy construction estimating is different from commercial estimating Describe a unit price bid Decide when and where the different types of estimates are used Illustrate the different parts of the unit price estimate and describe them Explain how the different types of cost play a role in heavy construction estimating

Session Outline Construction organizations (review)
Construction contracts (review) Contract documents Standard specifications Standard specifications for DOTs Unit prices Unit bid items WSDOT Unit bid items Short in-class exercise Quality control / acceptance Price adjustments

History of Project Delivery in US
Legal Separation of Design and Construction The Miller Act (1935) Public contracting laws mandating separation of design from construction & contractor selection solely on cost Professional licensing requirements

Project Delivery Defined
A comprehensive process including planning, design, construction and other services, necessary for organizing, executing and completing a construction project. Three fundamental owner decisions Type of project delivery system Type of procurement method Type of contract format

Project Delivery Process Framework
Performance Criteria Project Feasibility Critical Owner Decisions Facility Owner’s Profile Contract Format Selection Project Delivery System Selection Procurement Method Selection Programming & Scope Definition Team Selection Confirm Project Scope and Program Project Financing Design & Construction NOTE: Chart shows logic flow, not timing or sequence of steps, which vary depending on methods used. Operation & Maintenance

Project Delivery Always 3 or 4 major parties involved in the project delivery process Owner (public or private) Designer (Engineer or Architect) Contractor Construction Management Firm (can also be one of these parties)

The Method Selected will:
Determines the contractual relationships among the parties. Establishes when the parties become engaged. Influences impact of changes and modifications on project cost.

Project Delivery Types
Design-bid-build (Lump Sum or Unit Price) Multi-prime (often under CM) Construction management-at-risk Construction Management agency Design-build (DB, EPC, etc.)

Procurement Defined Procurement is the methodology used to buy design and construction services.

Construction Contracts
Method of pricing Fixed-price Lump sum contract Unit price contract Cost-plus Cost plus percentage of cost Cost plus fixed fee Cost plus fixed fee with a targeted maximum cost Cost plus incentive fee Guaranteed Max Price GMP plus percentage of cost GMP plus fixed fee GMP plus a fixed fee plus share of savings - incentive Method of award Competitively Bid contracts With designer doing Project Supervision With CM – agency CM at Risk Design Build Negotiated contracts GMP Negotiated Lump sum

Procurement Options Sole Source/Direct Selection
Negotiated procurement Competitive QBS – Qualification Based Selection BVS - Best Value Selection Low Bid DBIA has MOP #203 The Design-Build Process Utilizing Best Value or Qualification Based Selection. DBIA has MOP #201 The Design-Build Process Utilizing Competitive Selection. DBIA has MOP #204 The Design-Build Process Utilizing Negotiated Selection.

Market Penetration of Major Project Delivery Systems

Design-Bid-Build Contractual Relationship
Owner Sub Consultants Designer Contractor Characteristics Three linear phases: Design, bid and build Three prime players: Owner, designer, constructor Two separate contracts: Owner to designer Owner to constructor Responsibilities Owner Designer Constructor Program, finance, management Prepares plans & specs, normal services Prime and sub construction Subcontractors

Design-Bid-Build Advantages
Established way of doing things Suitable for competitive bidding A/E directly works for owner Extensive litigation has resulted in well established legal precedents No legal barriers in procurement and licensing Insurance and bonding are well defined

Design-Bid-Build Disadvantages
Two contracts for owner to manage Disagreements go through owner Owner bears design adequacy risk All parties have different agendas/objectives Initial low bid might not result in final best value Bids over budget presents most difficulties in reducing costs / creates significant delay No constructor involvement in design Slowest project delivery Most litigious delivery process

Design-Bid-Build Unique attributes and challenges
Utilization helps to avoid potential conflicts of interest Provides a check and balance between design and construction functions Owners less familiar with the design and construction process may benefit from Design- Bid-Build because it is so well understood throughout the building industry.

Primary Reasons for Choosing Design-Bid-Build
Low first cost is the priority Project is simple Procurement laws restrict use of anything else Owner wants to control design No need for value engineering or innovation

Project delivery selection influences when contractor gets on board.
Influence vs. Cost Project delivery selection influences when contractor gets on board. Contractor on-board early allows best opportunity to achieve objectives RAPIDLY DECREASING INFLUENCE MAJOR INFLUENCE LOW INFLUENCE Large High COST INFLUENCE Low Small Planning & Design Construction & Operations

Risk in Heavy Construction
Equipment productivity Labor productivity How material may react differently in different circumstances Locations Lower number of subcontractors on job, higher risk to the General Fuel costs Soil Conditions (acting different than expected) Risk in Heavy Construction

How does Risk change the Estimate?
Higher profits Commercial Profits – 1% to 5% Heavy Profits – 8% to 15% Less return on investments Large cost of equipment Contingencies for potential escalation costs

Standard Specifications for DOT (Department of Transporation)
Typically do not use MasterFormat 2004 Generally use 9 Divisions General Requirements Earthwork Production from Quarry and Pit Sites and Stockpiling Bases Surface Treatments and Pavements Structures Drainage Structures, Storm Sewers, Water Mains, and Conduits Miscellaneous Construction Materials

Standard Specifications for most Commercial / Building Projects
Typically used today is the MasterFormat edition, but a new edition has been published (2004) MASTERFORMAT 1995 EDITION Before November 2004, MasterFormat was composed of 16 primary divisions: Division 1 — General Requirements Division 2 — Site Construction Division 3 — Concrete Division 4 — Masonry Division 5 — Metals Division 6 — Wood and Plastics Division 7 — Thermal and Moisture Protection Division 8 — Doors and Windows Division 9 — Finishes Division 10 — Specialties Division 11 — Equipment Division 12 — Furnishings Division 13 — Special Construction Division 14 — Conveying Systems Division 15 — Mechanical Division 16 — Electrical

Standard Specifications for most Commercial / Building Projects
MASTERFORMAT 2004 EDITION After November 2004, MasterFormat was composed of 49 primary divisions: The current MasterFormat Divisions are: Division

Divisions MasterFormat 1995 MasterFormat 2004
Procurement and Contracting Requirements Group Introductory Information 00 Procurement and Bidding Requirements Contracting Requirements Contracting Requirements Specifications Group General Requirements Subgroup 1 General Requirements 01 General Requirements Here we see a side-by-side comparison between MasterFormat 1995 and MasterFormat To help you follow along, numbers and titles that have been modified are shown in blue, and new ones shown in red. Note that the term “Bidding” is changed to “Procurement” to acknowledge that there are numerous methods to obtain pricing. Division one has been expanded to include performance requirements and life cycle activities.

Facility Construction Subgroup 2 Site Construction 02 Existing Conditions 3 Concrete 03 Concrete 4 Masonry 04 Masonry 5 Metals 05 Metals 6 Wood and Plastics 06 Wood, Plastics, and Composites 7 Thermal and Moisture Protection 07 Thermal and Moisture Protection 8 Doors and Windows 08 Openings In the Facility Construction Subgroup, most of the Division names remain the same as or very similar to the previous edition. Division 2 changes are a result of moving much of its former content to the new Site and Infrastructure Subgroup. The work that remains in Division 2 includes topics such as assessment and maintenance of existing conditions, subsurface investigations, demolition, and remediation of hazardous conditions. Division 06 has been expanded to include new types of composite materials such as structural components made with carbon fibers. Division 08 has been renamed because louvers and vents have been added to the category.

Facility Construction Subgroup (continued) 9 Finishes 09 Finishes 10 Specialties 11 Equipment 12 Furnishings 13 Special Construction 14 Conveying Systems 14 Conveying Equipment 15 – 19 Reserved Division 14 has been renamed because industrial types of material handling systems have been move to the new Process Equipment Subgroup. And, Divisions 15 and 16 have been reserved for future use since the mechanical and electrical work has been relocated to the Facilities Services Subgroup. Note that Division 17 is reserved for future work. During the past few years, many people made up titles for Division 17 as an ad hoc way of solving the overcrowding in MasterFormat. Now, there are officially designated divisions for all the work results that used to get stuck in Division 17.

Facility Services Subgroup 20 Reserved 13 Special Construction 21 Fire Suppression 15 Mechanical 22 Plumbing 23 Heating, Ventilating, and Air Conditioning 24 Reserved The facility services can amount to 30 percent or more of the total value of a building project. Yet the previous edition of MasterFormat had only two divisions for mechanical and electrical work. MasterFormat 2004, on the other hand, now has seven divisions offering flexibility in organization and room for expansion. If the following metaphors don’t work for you, don’t use them. There is now a breath of fresh air in the mechanical divisions,

Facility Services Subgroup (continued) 13 Special Construction 25 Integrated Automation 16 Electrical 26 Electrical 27 Communications 28 Electronic Safety and Security 29 Reserved And new light being shed on the electrical work. If your audience is oriented toward mechanical and electrical work, take time to discuss organization of this subgroup.

Site and Infrastructure Subgroup 30 Reserved 2 Site Construction 31 Earthwork 32 Exterior Improvements 33 Utilities 34 Transportation 35 Waterway and Marine Reserved Wide open spaces for the site work. If your audience is civil engineering oriented, take time to discuss organization of this subgroup. L Lets take a few minutes and look at what is being covered under these new Divisions 31-thru 35

Division 31 - EARTHWORK MasterFormat 2004 31 00 00 EARTHWORK
SITE CLEARING EARTH MOVING EARTHWORK METHODS SHORING AND UNDERPINNING EXCAVATION SUPPORT AND PROTECTION SPECIAL FOUNDATIONS AND LOAD-BEARING ELEMENTS TUNNELING AND MINING Reserved Reserved Lets take a quick look at what is covered under Division 31, Earthwork. If you notice, What used to be covered under 1 section title, like Site Clearing is now Division 31 - EARTHWORK

Process Equipment Subgroup 11 Equipment 40 Process Integration 41 Material Processing and Handling Equipment 42 Process Heating, Cooling and Drying Equipment 43 Process Gas and Liquid Handling, Purification and Storage Equipment And you can finally make something of the process engineering divisions. If your audience is process equipment oriented, take time to discuss organization of this subgroup. I invite you to get a copy of MasterFormat and take time to get familiar with the divisions in which you work. CSI has also prepared a Transition Matrix. Available in an excel file that shows the MF04 equivalents to both the 1988 MF and 1995 MF. In the back of the hard copy of the MF04 books that I’m passing around, you will see a KEYWORD index. It lists common terms and then recommends the section numbers which apply to them. This is a very handy resource.

Process Equipment Subgroup (continued) 11 Equipment 44 Pollution Control Equipment 45 Industry-Specific Manufacturing Equipment Reserved 16 Electrical / Special Construction 48 Electrical Power Generation 49 Reserved

Unit Prices Standard Units Defined in Standard Specifications

Unit Bid Items / Bid 03-0E2004 BID245
03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E R PAGE 7 04/23/08 04/27/08 ITEM ITEM UNIT OF ESTIMATED NO. CODE ITEM DESCRIPTION MEASURE QUANTITY BID AMOUNT CONSTRUCTION SITE MANAGEMENT LS , ,000.00 2 (S) WATER POLLUTION CONTROL PROGRAM LS , ,000.00 TEMPORARY CONC WASHOUT FACILITY EA , ,500.00 4 (S) CONSTRUCTION AREA SIGNS LS , ,000.00 5 (S) TRAFFIC CONTROL SYSTEM LS 1 150, ,000.00 6 (S) PORTABLE CHANGEABLE MESSAGE SIGN LS , ,000.00 REMOVE METAL BEAM GUARD RAILING LF 6, ,120.00 REMOVE ASPHALT CONCRETE DIKE LF ,400.00 REMOVE PRECAST CONC POST SUPPORT EA , ,000.00 10 (S) COLD PLANE ASPHALT CONC PAVEMENT SQYD ,500.00 CLEARING AND GRUBBING LS , ,000.00 ROADWAY EXCAVATION CY ,250.00 STRUCTURE BACKFILL (SLURRY CEMENT) CY ,250.00 CLASS 2 AGGREGATE BASE CY ,750.00 HOT MIX ASPHALT (TYPE A) TON ,000.00 PLACE HOT MIX ASPHALT DIKE (TYPE F) LF 1, ,050.00 PLACE HOT MIX ASPHALT (MISC AREA) SQYD 2, ,300.00 18 (F) MINOR CONCRETE (MINOR STRUCTURE) CY , ,000.00 PRECAST CONC POST SUPPORT (8 FOOT) EA , ,000.00 PRECAST CONC POST SUPPORT (6 FOOT) EA , ,000.00 21 (SF) MISCELLANEOUS IRON AND STEEL LB ,580.00 DELINEATOR (CLASS 2) EA ,760.00 OBJECT MARKER (TYPE L-1) EA 24 (S) METAL BEAM GUARD RAILING (STEEL) LF 6, ,975.00 METAL BEAM GUARD RAILING (ELEMENT) LF ,200.00 26 (S) TRANSITION RAILING (TYPE WB) EA , ,000.00 27 (S) TERMINAL SECTION (TYPE C) EA 28 (S) END ANCHOR ASSEMBLY (TYPE SFT) EA , ,000.00 29 (S) ALTERNATIVE FLARED TERMINAL SYSTEM EA , ,000.00 30 (S) PAINT TRAFFIC STRIPE (2-COAT) LF ,100.00 MOBILIZATION LS , ,000.00 TOTAL 980,685.00

03-0E2004 BID245 03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E R PAGE 7 04/23/08 04/27/08 ITEM NO. ITEM UNIT OF CODE DESCRIPTION MEASURE ESTIMATED UNIT BID QUANTITY PRICE AMOUNT 2 (S) WATER POLLUTION CONTROL PROGRAM LS $ 1, $ 1,000.00 ____________________________________________________________ 4 (S) CONSTRUCTION AREA SIGNS LS $ 3, $ 3,000.00 _____________________________________________________________ 5 (S) TRAFFIC CONTROL SYSTEM LS $ 150, $ 150, _____________________________________________________________ REMOVE METAL BEAM GUARD RAILING LF 6, $ $ 39,120.00 REMOVE ASPHALT CONCRETE DIKE LF r $ $ 8,400.00 REMOVE PRECAST CONC POST EA $ 2, $ 5,000.00 10 (S) COLD PLANE ASPHALT CONC PAVEMENT SQYD $ $ 16,500.00

UNIT OF ESTIMATED UNIT BID
MEASURE QUANTITY PRICE AMOUNT LS $ 98, $ 98,000.00 TOTAL $ 980,685.00

Heavy Estimates take on two styles:
Detail Estimates for Lump Sum Contracts and Subcontracts Unit Price Estimates for DOT and other Unit Price Contracts Remember that Heavy/Civil Contractors may act as Subcontractors on many projects

A Heavy Civil Detail Estimate looks much like a Detail Estimate for a Commercial Project
Major Differences Larger labor component Larger equipment component Very few Subcontractors More self performed work Not as many activities or work items Work items are often quantified by the agency for Unit Price Estimates

Structure of a Lump Sum Estimate and Bid
Summary Sheet Headings Description Labor Material (often called Permanent Materials) Consumables / Expendables (often called Expendable Materials) Subcontractors Equipment Operating Costs or Expense Repair Costs (Labor item) Rental Costs or Company Equipment Costs Total

Typical Lump Sum Bid Description Labor Materials Expendables Subs
Equip Operating Costs Repairs Rent Total Direct Costs Jobsite Indirect End of Bid Items Total Bid

Typical Unit Price Bid 03-0E2004 BID245
03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E R PAGE 7 04/23/08 04/27/08 ITEM ITEM UNIT OF ESTIMATED NO. CODE ITEM DESCRIPTION MEASURE QUANTITY BID AMOUNT CONSTRUCTION SITE MANAGEMENT LS , ,000.00 2 (S) WATER POLLUTION CONTROL PROGRAM LS , ,000.00 TEMPORARY CONC WASHOUT FACILITY EA , ,500.00 4 (S) CONSTRUCTION AREA SIGNS LS , ,000.00 5 (S) TRAFFIC CONTROL SYSTEM LS 1 150, ,000.00 6 (S) PORTABLE CHANGEABLE MESSAGE SIGN LS , ,000.00 REMOVE METAL BEAM GUARD RAILING LF 6, ,120.00 REMOVE ASPHALT CONCRETE DIKE LF ,400.00 REMOVE PRECAST CONC POST SUPPORT EA , ,000.00 10 (S) COLD PLANE ASPHALT CONC PAVEMENT SQYD ,500.00 CLEARING AND GRUBBING LS , ,000.00 ROADWAY EXCAVATION CY ,250.00 STRUCTURE BACKFILL (SLURRY CEMENT) CY ,250.00 CLASS 2 AGGREGATE BASE CY ,750.00 HOT MIX ASPHALT (TYPE A) TON ,000.00 PLACE HOT MIX ASPHALT DIKE (TYPE F) LF 1, ,050.00 PLACE HOT MIX ASPHALT (MISC AREA) SQYD 2, ,300.00 18 (F) MINOR CONCRETE (MINOR STRUCTURE) CY , ,000.00 PRECAST CONC POST SUPPORT (8 FOOT) EA , ,000.00 PRECAST CONC POST SUPPORT (6 FOOT) EA , ,000.00 21 (SF) MISCELLANEOUS IRON AND STEEL LB ,580.00 DELINEATOR (CLASS 2) EA ,760.00 OBJECT MARKER (TYPE L-1) EA 24 (S) METAL BEAM GUARD RAILING (STEEL) LF 6, ,975.00 METAL BEAM GUARD RAILING (ELEMENT) LF ,200.00 26 (S) TRANSITION RAILING (TYPE WB) EA , ,000.00 27 (S) TERMINAL SECTION (TYPE C) EA 28 (S) END ANCHOR ASSEMBLY (TYPE SFT) EA , ,000.00 29 (S) ALTERNATIVE FLARED TERMINAL SYSTEM EA , ,000.00 30 (S) PAINT TRAFFIC STRIPE (2-COAT) LF ,100.00 MOBILIZATION LS , ,000.00 TOTAL 980,685.00

Typical Lump Sum Bid

Typical Unit Price Bid

Major Difference: Distribution of Indirect Cost into Unit Prices
In-directs are totaled Each big item is calculated as a percentage of the total direct costs Using this percentage, we multiply the total direct costs by each percentage That number is than added to the base direct cost to come up with a total. It is divided by the quantity to generate a unit price Major Difference: Distribution of Indirect Cost into Unit Prices

How do we do this Distribution of In-directs?
First the In-directs and end of bid items are totaled. A total of direct costs is also established with a total A column of each bid item direct cost is made into a % of the total direct costs. This % is then multiplied by the total indirect cost This % of the indirect costs is than added to the direct costs How do we do this Distribution of In-directs?

The Result is: Example of Bid Item
Item No. Description HOT MIX ASPHALT (TYPE A) Unit Quantity Unit Price Total TON $ $ 55,000.00 The Result is: Example of Bid Item

Specification are reviewed for the Item No
Specification are reviewed for the Item No., what is included in each work items and how the item will be paid for.

The Pay Quantity vs. Bid Quantity
Defined as a quantity of individual units of work that represents the owner’s engineer’s estimate of the number of units of that type work included in the contract. Pay quantity - Defined as the quantity that is calculated when the work is completed and will be paid for by the owner

Is also defined as the quantity of projected work at time of bid
Is the calculated quantity by the contractor when checking engineer’s quantity May or may not equal the engineer’s quantity Work quantity

Relationship of the work quantity to the Bid Item
It is generally thought by the engineer to be equal. This is not always true as many contractors have found out – sometimes by surprise

Indirect Cost : Lump Sum vs. Unit Price
When bidding a lump sum, the quantities are not given and certified by the owner. The contractor is responsible for quantity determination. The owner will pay the lump sum bid amount plus any changes. When bidding a unit price contract, the engineer is giving the contractor the quantities and will pay the contractor the in-place quantities. Provisions are made when quantities get substantially out of balance. Indirect Cost : Lump Sum vs. Unit Price

Indirect Costs from Commercial compared to Heavy
Major Differences are: Mobilization costs and items are substantially different. Plant and equipment of large heavy projects. Temporary access / roads etc. can be very different Temporary power on a commercial project is much different. Surveying requirements can be much different from commercial to heavy construction. Indirect Costs from Commercial compared to Heavy

Is there any Strategy to Distribution of Indirect Project Costs?
To protect out of pocket expenses because of inaccurate bid quantities To favor work performed early in the schedule to create positive cash flows on project Other strategies Is there any Strategy to Distribution of Indirect Project Costs?

Unbalancing the Bid What words should we be watchful in bidding documents? “grossly unbalanced” “substantially unbalanced”

What Happens if there are Inaccurate Bid Quantities?
First on a Balanced Bid Most DOT specifications allow for change if quantities are grossly inaccurate. If there is no provision, the contractor could have the wrong equipment, too much equipment etc. Next on an Unbalanced Bid Contractor plays the risk of being determined as non responsive and bid being rejected. Owner could be paying a premium on the work. What Happens if there are Inaccurate Bid Quantities?

What Happens if there are Inaccurate Bid Quantities on a Balanced Bid?
Most DOT specifications allow for change if quantities are grossly inaccurate. If there is no provision, the contractor could have the wrong equipment, too much equipment, etc.

What Happens if there are Inaccurate Bid Quantities on a Unbalanced Bid?
Contractor plays the risk of being determined as non responsive and bid being rejected. Owner could be paying a premium on the work.

Rejection Can be the Consequences of Unbalanced Bid.
Owner will use the term: Non-responsive

03-0E2004 BID245 03-SIE-49-2 S U M M A R Y O F R E M A I N I N G B I D D E R S PAGE 9 04/23/08 04/27/08 | | ITEM| SIXTH | SEVENTH | BID AMOUNT | BID AMOUNT 1 | 8, | 2 | 1, 3 | 2, | 2, 4 | 3, | 1, 5 | 146, | 112, 6 | 12, | 4, 7 | | 8 | | 9 | 2, | 10 | | 11 | 10, | 15, 12 | | 13 | | 5, 14 | | 15 | | 16 | | 17 | | 18 | 4, | 1, 19 | 2, | 3, 20 | 2, | 3, 21 | | 22 | | 23 | | 24 | | 25 | | 26 | 6, | 3, 27 | | 28 | 1, | 29 | 3, | 2, 30 | | 31 | 100, | 157, TOT 1,032, ,487,484.04 How can an Owner tell or why would they even question the Contractor’s Unit Prices?

Other Bid # 3 Other Bid # 5 Item Unit Unit No
Other Bid # 3 Other Bid # 5 Item Unit Unit No. Price Total Price Total REMOVE ASPHALT CONCRETE DIKE LF 840 Possible Example

Example of Unbalancing: Fixed Costs, In-directs, etc.
Remember earlier we spread our indirects and end of bid items over our direct cost items. We did that based on each cost items value and gave each item a piece of the indirect costs based on that value. More costly items got more of the indirect cost. Instead of doing a percentage of each direct cost item, one could allocate any amount of the indirect costs to that bid items. We could even go so far as moving direct costs onto another direct cost in increase its total, keeping in mind that we would want to keep the total the same as a balance bid. Example of Unbalancing: Fixed Costs, In-directs, etc.

Flow chart of the Heavy Bid Process
Quantities are checked against the Engineers End of bid item distributed to Bid items

Unit Price Estimates and The Bid Process
Selection\Decision & Review Phase Review the Plans Specs. & Contract Select Project Does work fit with-in the company business plan? Does the company have the bonding capacity to handle the work? Probability of making a profit? Is it the type of work the company and its individuals can succeed at? Does my company have the right plant and equipment?

Preparation for Pricing
Subcontractor Determinations Estimator determines the scope of work that will be subcontracted. This is a much smaller group of subcontractors. Begin Takeoff for Self Work Estimator begins takeoff of quantities of work this contractor will do with their own forces. They will review the specifications for what to include in both the pay quantities and work quantities. Request for Material Quotes Estimator determines the scope of materials and sends out for quotes. Heavy contractors often control their own materials. i.e. rock, asphalt, concrete Site Visit Estimator schedules a site visit (Mandatory vs. Voluntary).

Preparation for Pricing Continued:
Request for Sub bids General Conditions and Indirect Job Cost Determination Job Plan & Preliminary Scheduling Much more time it spent On the job plan and scheduling Because of the plant and Equipment requirements Historical labor & Material Cost Records Reviewed

Analysis and Pricing Budgeting for Sub trades Subcontract Bid Tab.
Labor Pricing Material Pricing Plant and Equipment Pricing Indirect Job Cost Pricing

Cost Extensions & Finalizing the Estimate
Estimate Summary Distribution of End of Bid Items To the Bid Items End of Bid Items (Profit & Over- head)

Finalizing the Estimate
Bid or Proposal Submission Adjustment to Bid or Proposal Award of Project Owner’s Final Review Review & Log for Historical

Can be very similar to commercial process when bidding a lump sum.
But is very different when bidding a unit price type of contract Materials can play a major role in the bid process Plant and equipment are a big portion of the work Heavy Bid Process

The use of digitizers is used more that in commercial because of the speed of earthwork takeoff process. Also almost all heavy estimating is done with computers because of the need to distribute the indirect costs in unit price estimates. Heavy Bid Estimating

Heavy Civil can be either Lump Sum or Unit Price.
Summary Heavy Civil can be either Lump Sum or Unit Price. The Heavy Civil world also does negotiated work. More risk is associated with Heavy Construction work vs. Commercial work. Equipment productivity Labor productivity

End of Today’s Session Questions?

Estimating for Heavy Construction and Unit Price Bids

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