| When you first investigate computer based | | | | construction professional to either adapt to the |
| estimating software, you will find that there are | | | | software or simply decide not to use the |
| many software vendors selling solutions which | | | | software. |
| range from a few hundred dollars to many | | | | The best estimating software solutions should |
| thousands of dollars. In fact some estimating | | | | allow the construction professional to completely |
| software packages can cost upwards of 15-20 | | | | leverage existing industry database cost |
| thousand dollars and in some cases, as high as | | | | information as well as provide the ability for the |
| $100,000. That is quite a range of price. | | | | construction professional to create their own |
| Often, estimating software is selected based upon | | | | costbook database of information and even |
| the cost, features, functions, reviews, word of | | | | combine the two. This should be extended to |
| mouth, or other avenues. In many cases, potential | | | | have the ability to create as many costbook |
| customers do not consider how they are doing | | | | databases as the construction professional would |
| their estimating processes today, what they | | | | like to accommodate multiple types of estimating |
| would like to improve, how automation can, will, or | | | | situations. |
| will not help them, and what an estimating system | | | | A quick word on the estimating process. The |
| should do for their business. | | | | most accurate method of estimating is to use the |
| In many cases, the construction professional will | | | | Unit Cost Method of estimating. This means that |
| try and find a way to adapt their business to the | | | | each material item in a costbook database would |
| way a software package operates, rather then | | | | have at least a material and labor cost. Even |
| determine the best way to adapt the software | | | | better if the item provides for the ability to track |
| to enhance their current way of doing business. In | | | | subcontract and equipment costs and well as labor |
| many cases estimating software may not be | | | | rates. These costs are then defined for the item |
| flexible enough to allow a construction professional | | | | at the "unit of measure". |
| to "customize" the software to work in | | | | So for example, you could be working on |
| conjunction with the best business practices of | | | | reinforcing steel in a foundation and putting in 1/4" |
| the company. | | | | diameter, #2 rebar. This item is typically |
| An example of this is the cost information which | | | | categorized by the LB (foot pound) as the Unit of |
| is provided by many of the more advanced | | | | Measure. There might be a material cost per LB |
| construction estimating software vendors in the | | | | of .78 and a labor charge of .76 to install the |
| market. Often, you will see software vendors | | | | rebar for each 1 LB. The Unit Cost Method of |
| either providing their own cost data information | | | | estimating would take the material and labor costs |
| (often on a monthly subscription basis), or they | | | | and multiply these values by the total quantity (by |
| will resell industry cost database information such | | | | LB) required for the job. This would give you the |
| as RS Means or Craftsman. | | | | total cost of the work for this item in your |
| This is a good baseline for starting to use a | | | | estimate. You would do this for every item in |
| construction estimating software solution, but all | | | | your estimate. Some people might say this is |
| too often, construction professionals will begin to | | | | very time consuming, but this is the most |
| find that the data is not accurate for their specific | | | | accurate way of estimating the work. |
| geographic locations of work, their local | | | | In addition, some construction professionals might |
| distributors have different prices than what are | | | | say that the material and labor costs are |
| provided in the software costbook database | | | | inaccurate. These prices were taken from a |
| provided by the vendor and costbook updates | | | | national industry costbook database, and in fact, |
| provide by the software vendor are not timely | | | | could very well be inaccurate. A good software |
| enough to reflect local price changes in materials | | | | estimating program would allow you the ability to |
| (labor prices are usually pretty consistent over | | | | change any information about this item required |
| time). | | | | to match your own labor and material costs. One |
| As a result, the construction professional is not | | | | important consideration for this is that you should |
| satisfied with the software vendor's estimating | | | | base your current estimates not only on an |
| solution, the adoption of the software will diminish, | | | | updated costbook database, but also on the |
| and the construction professional will either begin | | | | results from historical estimating. This way, you |
| to more and more get frustrated while searching | | | | can see if in fact you made any profit from your |
| for another software solutions or revert back to | | | | last job and factor in this experience in terms of |
| their original estimating process. Often this is either | | | | changing the prices of items to reflect your profit |
| a basic spreadsheet or paper and pencil. | | | | margin. This is in addition to including standard |
| This creates an interesting buzz in the | | | | profit and overhead costs in your jobs. |
| marketplace and on construction forums where | | | | Some construction professionals will say that all of |
| construction professionals will compare, contrast | | | | this cost database construction and pricing |
| or complain about various estimating software | | | | definition is very time consuming, but in reality, we |
| packages because they do not do the job they | | | | have found that most GC's would require from |
| were expecting, are not reliable, and in many | | | | 300-800 items in a customized costbook |
| cases are down right inaccurate...enough so that | | | | database. This would take care of about 90-95% |
| the estimator no longer has any faith in the | | | | of the typical estimating requirements of the |
| results provided by the estimating software. At | | | | construction professional. This is a far cry from |
| best, the software is either used for | | | | the 30,000-60,000 items which are typical of an |
| "guesstimates" or becomes "shelfware". | | | | industry costbook database....and much easier to |
| The problem with this perspective is that the | | | | update and manage. |
| estimating software is perceived as "bad". In | | | | So the point of this article is to tell you that the |
| reality, the software might be just fine | | | | first thing you should consider when looking for an |
| (operationally), but it is the cost information and | | | | estimating system is the ability to create your |
| cost data which is not correct for the particular | | | | own costbook database, and be able to leverage |
| construction professional. Also, in many cases, | | | | existing industry costbook information to do that. |
| software vendors will "lock down" the cost data | | | | In addition, this should be an easy process and be |
| either because they make money off of the data | | | | able to leverage all the capabilities of the |
| or do not want the customer to change the | | | | estimating software, such as reports or other |
| information because they have specific features | | | | functions. This way, you will be able to find an |
| and functions in the software which are | | | | estimating software solution which fits your |
| dependent upon the information contained in the | | | | business rather than trying to fit your business |
| cost data (such as estimating assemblies or multi | | | | into the methods and practices of the estimating |
| hierarchical costbook databases). This creates a | | | | system software! |
| very inflexible solution which requires the | | | | |