Electrical Estimating Methods, 4th Edition

CHAPTER 5 Pricing the Estimate

When the quantities have been derived and the takeoff is complete, the next phase of the estimate can begin. This phase involves the addition of prices and multiplication of quantities by the unit price to arrive at the total cost for a task. It is aptly named the pricing phase.

It is at this point in the process that the estimator must select one of the methods for pricing described in Chapter 1, “Components of an Estimate.” In many electrical contracting companies, it is less the estimator's decision than a matter of company policy as to the method used. In unit price estimating, the unit costs most commonly applied are bare or unburdened costs. The burden is then added at the summary stage. This is also true for materials, labor, and equipment. In the following paragraphs, we will demonstrate by using the most common method.

A majority of electrical estimators calculate the cost of labor by labor-hours. When the total labor-hours are determined, it is necessary to multiply these figures by the appropriate hourly rate before adding markups. The extended labor quantities are summarized as total labor-hours to which burdens are applied. Material quantities extended to costs are represented as dollars. Items such as overhead and profit are usually added to the total direct costs at the estimate summary.

SOURCES OF COST DATA

One of the most difficult aspects of the estimator's job is determining accurate and reliable cost data to be used in the ...