Construction projects require impressive feats of engineering and carefully planned logistics. To ensure the success of a project and to understand the time and cost involved in realizing a building plan, providing construction estimates to investors must always be a priority. The process, however, is not easy. The majority of project managers uses construction estimating programs to plan more efficiently.
When it comes to construction cost estimates, there are two ways to go about it: Estimate by the stick or use unit cost estimating. While both methods are useful, one is significantly more effective and accurate.
Estimating by the stick is one of the oldest methods used to determine the cost of a project. As the name suggests, stick estimates measure the cost of each item “by the stick.” Generally, it involves making a list of everything that is needed in the project, including the materials and the labor.
After listing the materials and equipment needed, the project manager will then list down the market prices and make an estimate based on that. While this method works well for smaller projects, it does not scale well to a larger project. It can be difficult to provide accurate estimates with the stick method because a lot of things can affect the final cost of the project, such as changing market prices and delays in construction.
Unit Cost Estimating
Unit cost estimating works best for larger jobs. Indeed, it is now the standard estimating method used in construction projects. Instead of listing down each item and each task, the project manager will complete all the line items for that job, and then add a unit cost to each line item.
This way, you can apply your labor costs as needed, to get your final price. Unit pricing takes the average bid price of standard items.
This method is more efficient and better suited for large construction jobs because it can accommodate delays and price changes.
Construction estimates must be accurate. Depending on the size and complexity of your project, you may need to go with one estimating method instead of the other.