Calculation & Acquisition

Quantity determination

For tenders and bills of quantities we determine the required performance sizes and quantities. If no or insufficiently precise plans are available (e.g. in the case of functional tenders), we find the way to reliable figures via optimised estimation methods such as project comparisons or our self-developed key figure statistics.

Often it also makes sense to subject the specifications of tendering architects once again to a thorough plausibility check in order to check whether the figures tend to be “rounded up” too high or unrealistically tight. Accordingly, a project-specific costing strategy can be derived from this. Over-declared quantities are given a reduced calculation price and under-declared quantities are weighted accordingly with a surcharge factor to compensate for the losses from the price-reduced items. This method significantly increases the likelihood of winning the contract because it is based on the actual expected contract value rather than the distorted quantity structure of the inaccurate RFP. Knowing the actual quantities as precisely as possible compared to the declared tender quantities also allows indirect conclusions to be drawn about the handling of any hidden reserves and thus about the underlying tender strategy of the architect as well as possibly about the budget background of the construction project.

Calculation

As a cost estimator in a leading position for many years, I know all facets of the “craft” of the cost estimator in the field of master builder, remodeling and interior design. Whether NPK items, BKP, functional tenders, we calculate all types of construction projects and tender types meticulously and professionally.

In doing so, I would like to raise your awareness that “good” costing should not be limited to simply calculating construction costs. Successful calculators not only recognize the gaps, errors and exaggerations in the tender, they optimize their offer to keep the offer price low and at the same time the actually achievable revenue as high as possible.

But how do you recognize errors in the tender? And when do you start your own quantity surveys to check the quantities in the tender? The time involved is significant and not worth it for every bid that crosses the estimator’s desk. For this purpose, it is advantageous if a calculator keeps statistics of his calculated objects over the years and records essential parameters of the calculated buildings. From this, many important characteristic values can be determined for different types of buildings and types of work, which can be used for quick plausibility checks in future calculations.

Are the total construction costs for a given property size and complexity within expectations? Are the reinforcement tonnages and concrete quantities correct in relation to the building volume? Are the work categories in the right percentage structure? Many calculators have developed their own methods and working methods here, which they often take with them into retirement or into the grave take. The classical textbooks do not give any advice on this.

It is also particularly important to identify alternative methods, products and construction processes that can be offered to the client as special proposals and often trigger a high level of interest on the part of the client, as experienced master builders usually have the relevant expertise and their optimisation proposals promise tangible savings and schedule benefits for both sides. A committed master builder who stands out from his competitors with his know-how, good ideas and specialist knowledge finds grateful listeners and often wins the contract.

Acquisition

In negotiations and award talks, success depends not only on the skilful handling of figures and price speculation, but also to a large extent on dealing with people. This includes a sympathetic and serious appearance as well as psychological empathy and the right negotiation tactics.

In interior design and fit-out projects, the right approach to presentations and the visual design of the solutions offered is, of course, also crucial, in addition to price.

We are happy to support and advise you on all these topics – for a well-filled order pipeline at all times!

Tenders

We carry out your tenders (FM, GU and TU), evaluate the best provider for you, draw up market price and cost comparisons and ensure that there is no need for endless discussions about the scope of services after the contract has been signed. Use our wealth of experience, our know-how on specific specifications and public tenders and our knowledge of current market developments to your advantage.

Billing

Of course, we are also happy to support you in matters of invoicing, prepare reports, draw up measurements (on site or on the basis of plans) and settle these for you with your client. It is very advantageous if the accounting department has the knowledge background of the calculation and can use it to its advantage.

Encyclopedia

Job order costing

The basis of the order calculation is the
Quotation costing
as the price quotation for an existing bid invitation. The quotation costing does not have to be identical with the order placement. Corrections may have to be made if, for example, changes in performance or prices may be necessary as a result of the review of the quotation or contract negotiations. The quotation costing is then followed by the order or contract costing which takes into account those corrections. It reflects the contractually agreed prices based on the construction contract awarded. It then provides the basis for the following forms of construction costing after the order has been placed or the contract has been concluded, for example
Work costing
, supplementary costing and, if necessary, final costing. The structure of the order cost estimate corresponds to the structure of the quotation cost estimate. According to the content of the calculation approaches used for this purpose, it is practically equivalent to a
Original costing
equivalent.

Working calculation

The work calculation is carried out after the order has been placed, taking into account the concrete conditions of the
Work preparation
for the construction work.

It may turn out that other plans than those assumed in the offer calculation are more expedient and possibly more economical. In addition, material prices and subcontractor prices are finalised on the basis of awards. These cost changes must be taken into account in the work calculation.

However, the procedure of labor costing is not fundamentally different from that of quotation costing. The latter provides the output quantities for the job costing, e.g. the target hours for the planned activity quantities and thus the basis, for example, for the target/actual hours comparison and the
Construction Site Controlling
.

The concrete content of the work calculation depends on the objective. The goal should not only be formally to provide target data for a later post-calculation, but rather to do so,

  • to gain early knowledge of the probable outcome of the construction site, and
  • support financial planning at the same time

Consequently, early processing is essential in order to still be able to initiate appropriate measures. If the work calculation is to have an influence in this sense, it must correspond as closely as possible to the anticipated conditions of the construction work. It should not be the purpose of the job costing to confirm the bid costing approaches.

In most cases, only preliminary plans are made for the quotation calculation, e.g. for the construction process, the construction site equipment, the use of construction equipment, etc. After the conclusion of the contract, the preparation for the execution of the construction project has to take place.

Especially in work preparation, controlling is of particular importance in terms of finding the most cost-effective solutions for construction in the respective context. If the calculation approaches of the offer calculation coincide to a large extent with the cost-determining planned building process, then often only an adjustment or reworking of the existing contract calculation to the work calculation is sufficient.

If one wants to give the appropriate sense to the work calculation beyond that, then relevant is

  • to re-examine the prices and final quantities of building materials
  • the construction equipment, formwork and scaffolding materials to be used
  • the subcontractor services and final prices

The resulting cost impact should be considered in the work estimate. In order to enable a later analysis according to influencing factors, the calculation formalities should methodically correspond to the accounting methods (“apples to apples”).

The work calculation is the starting point for construction site controlling. It is responsible for the following tasks:

  • Provide specifications for target/actual comparative accounting as well asfor cost and performance control
  • Basis for service determination and invoicing
  • Provide specifications for the construction management for economical construction, for profitability comparisons, for the performance wage, etc.

It is therefore advantageous to set up the work calculation from the outset in such a way that it

  • on the one hand, represents the result of a revision of the offer calculation after placing the order with the then known (and concretized) object conditions
  • on the other hand, with the corresponding degree of differentiation (e.g. by unbundling service items, especially for complex items, valuation of individual material types, large equipment, etc.).

In addition, the content of the final costing must be coordinated with the company’s accounting system in order to rule out from the outset that a comparison with possible actual values is practically impossible or distorted.

Methodically, work calculations – if at all – are designed very differently within the company. The basis for this is also the bill of quantities with the item classifications contained therein. However, this breakdown requires further subdivision into special items and additional aggregation according to the requirements of the service performance and the time allocation (e.g. e.g. by months based on cost and activity accounting).

This step is accompanied, for example, by the following steps:

  • Unbundling of “complex” service items (e.g. “concrete incl. formwork” in m3 concrete and m2 formwork),
  • Adjustment of all items that have been changed, deleted or added in the meantime.
  • Incorporation of additional discounts obtained from suppliers, etc.

With all these changes, (selected and decisive) direct costs of the partial services are calculated.

This is done methodically analogous to the quotation costing, but necessarily in coordination with the cost accounting as well as the final costing.

The overhead costs are – if possible – either to be calculated retrospectively and to be settled and analysed as direct costs for the internal cost comparison or their assessment is not possible or only possible on the scale of the enterprise, so that a real costing can be dispensed with.

In contrast to unit pricing in quotation costing, no cost portions should be allocated via overhead in job costing. Only the direct costs that can be directly assigned are therefore listed in the activity items.

After submitting this work calculation, the next step is to make comparisons to the bid to be sure that the profit expectations are accurate. For this reason and for other considerations (e.g. cost-psychological aspects), adjustments may be necessary. In addition to the pre-construction adjustments already described, these can also be useful during the construction period.

This is particularly the case with

  • accurate recording of the construction site equipment
  • changing times
  • changed average wages due to changes in column composition, wage increases, etc.
  • changed and volatile material prices free construction site
  • Conversion of own services into subcontracted services and vice versa
  • supplements, complications and additional services
  • Cancellation of services, etc.