introduction to estimation

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ESTIMATION
(MODULE-I)
BID - 406
(SPECIFICATION AND ESTIMATION)
Ar. ASHISH SHARMA
(ASAP)
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TWO BASIC ASPECTS OF ANY
CONSTRUCTION
QUANTITY ASPECT QUALITY ASPECT
 These two aspects of construction lead to form or govern the
estimate work.
The process of preparing an estimate is known as estimating. It
includes – (1) working out quantities & (2) abstracting

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 Accuracy in estimate is very important.
 If the estimate is prepared carefully and by considering
all likely conditions and circumstances, there will
practically be little difference between the amount of
detailed estimates and the actual cost of construction.
In preparing the correct estimate, care should be taken
to find out the dimensions of all the items correctly and
that no item of work or part thereof is left out.
The rates of each item should be reasonable and
workable.

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The rates in the estimate provided for the complete work, which
consist of :
The cost of materials
Cost of transport
Cost of labour
Cost of tools & plants
Cost of water
Taxes
Establishment and supervision cost
Reasonable profit of contractor etc.

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ESTIMATES CAN BE BROADLY
DIVIDED INTO TWO CATEGORIES
APPROXIMATE
ESTIMATE
DETAILED
ESTIMATE
 Strictly speaking all the estimates are more or less
approximate, because the actual cost of construction cannot
be known untill it is completed in all respects.

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A detailed estimate gives an amount which is very near to the
final amount of the construction and is more accurate.
The detailed estimate is prepared mainly for two purposes :
1. Execution process of the project, and
2. Obtaining technical sanctions.

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In preparation of a detailed estimate, the whole project is
divided into various stages and then each stage is further sub-
divided into various items of work.
The quantities of such items of work are accurately worked out
from the detailed drawings.

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THE DETAILED ESTIMATE COMPRISE THE COST AS
FOLLOWS :
1. Total Cost Of Various Items Of Project.
2. Allowance For The Contingencies To Accommodate
Unforeseen Expenditure On Missed Items And Small
Variations In Quantity And/ Or Rate In Different Items Of
Work.
3. Establishment Charges For Supervision.
4. Estimated Cost For Service Charges Which Include Water
Supply Connections, Sanitary Arrangements And Electrical
Installations.

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Necessity of approximate estimate:
Approximate estimate of the structure of project is generally
worked out before its detailed estimate is taken in hand.
The approximate estimate is used for following purposes :
1. In making preliminary studies of various aspects of the
project.
2. In commercial projects, it gives some idea about weather
the investment in such a project is justified or not.
3. For non commercial projects it helps in recommending
such projects on the grounds of their necessity, utility, etc.

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4. This estimate gives fairly good idea regarding the
approximate cost of the proposed construction and thus it
gives time to arrange the required finance before hand.
5. This estimate, particularly in case of works of public utility,
is very much useful in framing tax schedules.
6. This estimate is also used for fixing the value of project for
the insurance requirements.

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GENERAL PRINCIPLE OF APPROXIMATE
METHODS OF COSTING:
• There are number of methods by which
approximate estimates of the structures can be
prepared.
• But in general principle, they all consist of
multiplying the number of items or units in the
proposed structure by the known cost of a familiar
item or unit in a similar existing structure.

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This method involved two operations :
1. A unit is fixed up and the number of such units in the
proposed work is counted, then by studying the similar
existing structures constructed in the vicinity in near
past the actual cost of unit is fixed up.
2. By multiplying the number of units with the actual cost
of one unit, approximate cost of the proposed work is
assessed.

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Cost Index :
• The actual cost of the unit is subjected to variation due
to rise in prices of materials, labours and even due to
changed local conditions.
• Cost index is one such method which helps in
assessing the present cost of a unit
• It is a simple device which shows the relative changes
in the cost of specific or group of items over a certain
period of time.

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COST INDEX IS PREPARED AS FOLLOWS :
• First of all base period is selected and critical items
comprising the index are decided.
• Weight is assigned to each item and unit prices are
collected periodically.
• The cost index is worked out as follows :

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• The cost index of headquarters is decided and the cost
indices are framed for different parts of the country.
The cost index method suffers from following drawbacks :
1. The cost index assumes that there is rise and fall in all the
construction materials and labour at the same time.
2. This method does not take into consideration the availability
of cheap labours and local materials. It also does not reflect
seasonal variation in the prices of materials and labour.
3. The cost index varies with different types of buildings, use of
building, number of floors, specifications of work etc. hence
it is not possible to have an all purpose cost index for the
construction work.

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4. The prices of materials vary from place to place and even
from shop to shop. So it is advised to use whole sale prices
rather than retail prices.
5. Modern design criteria, better planning, modern methods of
construction, cause considerable economy in construction
cost. Hence the weights allotted to important items should
be constantly reviewed and modified to get the realistic
outcome.

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