15 Construction Estimating Mistakes Contractors Must Avoid

Construction estimating is a pivotal part of any project. It evaluates the total material cost and estimates other expenses. Any mistake in construction estimating can cause a contractor financial loss and even result in the loss of a project. While providing cost estimating services, there are some mistakes an estimator makes, which are the following:

Poor Review of Drawing and Specifications:

It is a common mistake an estimator makes while reviewing drawings and specifications. This happens when an estimator ignores or fails to understand the project plan and its technical details while calculating.

Drawings are the visual plans of the project that include elevations, floor plans and structure details. Specifications are the written documents explaining materials, workmanship, installation methods and project requirements. Both of these documents work together.

Incorrect Quantity Takeoff:

Quantity takeoff services are an important part of any project which is done with precision. The mistake in quantity takeoff happens after an estimator makes a mistake in reviewing the drawings and specifications. It leads to the incorrect quantity takeoff, which later becomes a mistake in estimation. An incorrect quantity takeoff can result in missing material from any of the MEP (mechanical, electrical, and plumbing). These missing materials then affect the total evaluated price.

These mistakes are avoidable by careful review of every single detail of the project plan. Otherwise, these small mistakes lead to more problems, like budget overruns and repetition of quantity takeoffs, which consume more time.

Using Outdated Material Prices:

The price of some materials fluctuates frequently. This happens either due to the high demand for materials or it changes due to energy and fuel costs.

Steel and rebar prices change due to the supply chain and the international market rates.
Cement prices fluctuate due to high energy consumption.
Lumber prices change with the demand.
Bricks and concrete prices fluctuate with fuel costs for transport and manufacturing.

This can be avoided with the help of a supply market expert, who will provide updated prices for these materials to prevent such mistakes. Stock the total quantity of steel so that the changing price does not affect the cost estimation.

Underestimating Labour Costs:

Understanding of labour cost is important in construction estimating. It includes the number of workers and their wages. But the condition of the work can affect the actual cost estimation. Change in the project completion timeline, which will require them to work overtime. Overtime pays more than usual wages.

To estimate labour cost, risk management should be added as an additional cost in case of overtime or the need for extra workers.

Ignoring Site Condition:

Site conditions matter in terms of calculating the total cost. An estimator must be aware of the site conditions before evaluating the total budget. The site location and condition both matter. The soil of the site should be tested before starting the project; it would help in avoiding more trouble later.

Remote Construction Site:

The cost of a remote-site project differs from that of a site project in a city. A remote site has more transport costs, including the cost of moving heavy machinery to a remote site. A calculation needs to be made after the inspection of the site and its condition.

Forgetting Overhead Expenses or Indirect Costs:

While evaluating the budget, the indirect costs need to be added to it. These indirect costs and overhead costs are the following:

Equipment Rentals:

The cost of construction equipment is to be evaluated in the total budget. As these equipments are necessary in construction work.

Fuel and Maintenance:

The cost of fuel used by machinery is to be added, and the maintenance cost of the machinery is to be calculated in the estimation.

Other than these two, there are plenty more indirect costs that are to be calculated in the total budget estimate, like safety measures, site supervision, insurance, and many more.

Depending on Manual Estimating:

In construction estimating, doing manual estimating is one of the big mistakes that leads to errors in calculation. Manual estimating consumes more time, and its accuracy is lower. To avoid such mistakes, the estimator must use the estimating software to evaluate the cost more accurately. These software and tools can be used in both construction takeoff services and construction estimating services.

Unrealistic Project Timeline:

Unrealistic project timelines are the unscheduled events that delay the project’s completion. Sometimes it happens when the deadline of a project is decided without full consideration. It happens due to the availability of labour, the delivery of material, weather conditions, and the complexity of a design.

In construction estimating and project management, an unrealistic timeline creates pressure on contractors, engineers and workers. This leads to mistakes like budget overruns and poor-quality work. It can be avoided through scheduling software and estimating on the basis of past project data.

Double Counting or Omitting Items:

During construction estimating, double counting happens when the material, labour or any other component is counted twice. And omitting means leaving out the necessary material, labour, and equipment. This affects the overall estimation of a project and results in delays of work and financial crises.

This mistake can be prevented by using a detailed checklist of items. A cross-check of the quantity is necessary to overcome such faults. The use of estimating software is more helpful with such errors.

Not Including Contingency Cost:

This is one of the most common mistakes in estimating. Contingency cost is the extra amount of money added to the total estimation. What is the purpose of this added amount? It covers the unexpected expenses that may occur during the project. It can be due to the following reasons:

Material price increase.
Change in design.
Unexpected weather delay.
Labour shortage and more.

Failure to Account for Waste Factors:

This common error in estimation can lead to a shortage of material in construction, which will have an effect on the project budget. In construction, materials are rarely used with 100% efficiency. For example, tiles often need to be cut to fit the corners, which results in the waste of tiles. In the same way, other materials like concrete, steel rebar, drywall, and wood can also experience material loss.

Ignoring Equipment and Machinery Costs:

This is one of the major mistakes estimators make when the expenses related to construction equipment are not included in the estimate. Construction projects rely on heavy machinery and equipment. That includes

Excavator
Cranes
Buildozer
Loaders
Concrete mixer
Generators

These machinery estimates involve fuel consumption, transportation, maintenance, repairs, and other costs. If such expenses are ignored, that will affect the evaluated project cost.

Poor Bid Review Process:

It is a mistake in construction estimating where the final estimate and bid proposal are submitted without careful review and verification. It is necessary to check all calculations of material, labour, equipment and other expenses to finalise the bid reports and the final calculation. A small mistake could lead to costly errors like missing items and incorrect pricing. Focusing on competing bids quickly without proper review increases the risk of submitting inaccurate or unprofitable bids.

Inadequate Documentation:

Documentation is one of the essential parts of tracking project cost, verifying calculations, managing changes, and supporting communication between contractors, clients, suppliers, and subcontractors. This documentation needs to be organised and maintained carefully. Poor documentation can create confusion and misunderstandings. Inadequate documentation may include the following:

Missing quantity takeoff records
Incomplete cost breakdown
Written communication records
Unorganised quotation of the supplier
Poor change order record
Failure in tracking drawing revision

Conclusion:

To conclude everything, these common errors need to be fixed before they affect the whole project. A contractor has to hire an expert who will do the estimating for him in order to get an accurate number. This will help him save more time to be prepared for the bid. Our construction estimating experts are always here to help you out with estimating services.

FAQs

How do estimating errors affect construction projects?

Estimating errors can lead to budget overruns, project delays, low profit, and even project failure.

Why should contractors add contingency to the estimates?

Contingency covers unexpected expenses such as material price increases, design changes, and unforeseen site conditions.

Can outsourcing estimating services reduce mistakes?

Yes, outsourcing to experienced estimators can improve accuracy, save time, and help contractors focus on project execution and bidding.

Top 15 Construction Estimating Mistakes