CEQSURV-QUIZ1

PROJECT COMPARISON ESTIMATES

prepared by comparing the cost of a proposed project to a completed project. •When preparing an estimate using this method, the estimator starts with the costs of a comparable project and then makes adjustments for differences in the project.

Design-build (DB)

the contractor acts as both the designer and the general contractor.

THE COMPLEXITY OF THE PROJECT THE SIZE OF THE PROJECT TIME OF YEAR (E.G. CHRISTMAS PERIOD); AND MARKET CONDITIONS

to assess a suitable tender period?

Cost

total amount of input or resources needed to produce a product of complete a deliverable

PARAMETRIC ESTIMATES

use equations that express the statistical relationship between building parameters and the cost of the building. •The building parameters used in the equation may include the gross square footage, number of floors, length of perimeter, percentage of the building that is common space, and so forth.

MODEL ESTIMATION

uses computer models to prepare an estimate based on a number of questions answered by the estimator. •Model estimating is similar to assembly estimating, but it requires less input from the estimator.

PLANNING THE ESTIMATE

who will do which portion and when should have a bar chart schedule that details when the activities comprising the estimate will be completed -person responsible

SUPPLEMENTARY GENERAL CONDITIONS

• Aspects of the contractual relationship that are peculiar or unique to a given project: • amends or supplements portions of the general conditions. • geared to all the special requirements of geography, local requirements, and individual project needs. • part of the supplemental conditions cancels or amends the articles in the general conditions, while the remaining portion adds articles.

Technical Specifications/requirements

• Project technical information is delineated in two forms: graphic (drawings) and narrative (specifications). • Precise picture of the technical aspects of the work to be performed. • Accomplished thru Drawings • Standards of workmanship • Material standards • Quality required

Pre-tender Estimate

• Reasons • client will want to know that they can afford the proposed development; • so there is a basis of comparison when the tenders are returned.

invitation to bid

• The date of availability of the Bidding Documents, which shall be from the time the ________ is first advertised/posted until the deadline for the submission and receipt of bids. • The place where the Bidding Documents may be purchased or the website where it may be downloaded. • The deadline for the submission and receipt of bids from the last day of posting of the Invitation to Bid; and • Any important bid evaluation criteria

FORM OF OWNER/CONTRACTORAGREEMENT

• The owner/contractor agreement form spells out exactly the type or form of agreement between the owner and the contractor.

ADDENDA

• The period after the basic contract documents have been issued to the bidders and before the bids are due is known as the bidding period. • Any amendments, modifications, revisions, corrections, and explanations issued by the architect/engineer during the bidding period are affected by issuing the addenda• Bidders are notified of any corrections in the documents, interpretations required, and any additional requirements, as well as other similar matters. • The addenda must be in writing.•

SPECIFICATIONS

• Written descriptions of materials, construction systems and workmanship. • Define the quality of materials and the results to be provided by the application of construction methods The __________(sometimes referred to as the technical specifications) • Generally follow the CSI MasterFormat. • Include the type of materials required, their required performance, and the method that must be used to obtain the specified result.

Bill of Quantities (BOQ)

• a document formatted and worded in accordance with a set of coverage rules provided from a measurement guide, which comprises a measured quantity alongside a description of the works.

ORGANIZATION

• a plan for completing the estimate • maintaining complete and up-to date files • must include a complete breakdown of costs for the project, both of work done by company forces (in-house) and of work done by subcontractors • using appropriate software can be an effective way to keep organized. • must be systematically done, neat, clear, and easy to follow.

BID (PROPOSAL) FORMS

• contractor must use this form to present the bid. • By using a prepared bid form, the owner can evaluate all bids on the same basis. • stipulates the price for which the contractor agrees to perform all of the work described in the contract documents. • ensures that if the owner accepts the proposal within a certain time, the contractor must enter into an agreement or the owner may keep the bid security as liquidated damages. • Contractor's desire/intent to perform the work and the price at which he will construct the project • It is an offer and by itself nota formal contract. • Duration specified • Commencement of work

ALTERNATES

• generally spelled out on a separate listing in the project manual, and they are listed on the proposal form. • A request for a price for substituting one material for another, for adding to the scope of work, or for deducting from the scope. • The alternates may be either an add price or a deduct price, which means that contractors either add the price to the base bid (the price without any alternatives) or deduct it from the base bid. • The price for any alternates must be complete and include all taxes, overhead, and profit. • When an owner has a limited budget, the system of alternates allows a choice on how to best spend the available money.

Trade by Trade

• involves organising the measuring of the quantities in the same order as the final presentation, i.e., each surveyor has the responsibility for measuring a complete trade and is issued with a complete set of drawings and other information relating to the project.

INVITATION TO BID(ADVERTISEMENT FOR BIDS)

• provides information that enables potential Bidders to decide whether to participate in the procurement at hand • Advertised at least once in a newspaper of general nationwide circulationwhich has been regularly published for at least two (2) years before the date of issue of the advertisement, subject to Sections 21.2.2 of the IRR of R.A. 9184; • Posted continuously in the Philippine Government Electronic Procurement System (PhilGEPS) website and the website of the Procuring Entity concerned, if available, for a minimum period of seven (7) calendar days starting on the date of advertisement; and • Posted at any conspicuous place reserved for this purpose in the premises of the Procuring Entity concerned for a minimum period of seven (7) calendar days, as certified by the head of the Bids and Awards Committee (BAC) Secretariat of the Procuring Entity concerned.

SPECIFICATIONS

• technical document prepared by a consultant that details project requirements and standards which encompass materials, workmanship and the level of service expected from the products.

Reports

• various reports giving information for particular aspectsof a project. • E.g. Hazardous material report, site investigation reports

• the type of construction involved compared with the type of construction the contractor is usually involved in, • the location of the project, • the size of the project in terms of total cost and in relation to bonding capacity, • the architect/ engineer, • the amount of work currently under construction, • the equipment available, and • whether qualified personnel are available to run the project

•Considerations to bid or not to bid

Design Economics

•How changes in the building parameters affect its cost? •Many elements affect the cost of a building. •Need to fulfill client's values and requirements

Bonds

•Often referred to as surety bonds •written documents that describe the conditions and obligations relating to the agreement. In law, a surety is one who guarantees payment of another party's obligations. •The bond is not a financial loan or insurance policy, but serves as an endorsement of the contractor.

Subcontractor Bonds

•Performance, and labor and materials (payment) bonds are those that the subcontractors must supply to the prime contractor. •They protect the prime contractor against financial loss and litigation due to default by a subcontractor.

Labor and Material Bond

•also referred to as a payment bond, guarantees the payment of the contractor's bill for labor and materials used or supplied on the project. •It acts as protection for the third parties and the owner, who are exempted from any liabilities in connection with claims against the project.

Design Phase

•contractor prepares and maintains a cost estimate based on the current, but incomplete, design. •often referred to as a preliminary estimate.

•Bid Bond

•ensures that if a contractor is awarded the bid within the time specified, the contractor will enter into the contract and provide all other specified bonds. •If the contractor fails to do so without justification, the bond will be forfeited to the owner.

Performance Bond

•guarantees the owner that the contractor will perform all work in accordance with the contract documents and that the owner will receive the project built in substantial agreement with the documents. •It protects the owner against default on the part of the contractor up to the amount of the bond penalty.

PROJECT MANUAL

•often referred to as the specifications •a document that accompanies the drawings and includes information on how to bid the project, the contractual obligations of the successful contractor, and the specifications for the materials used in the construction

SQUARE FOOT ESTIMATE

•prepared by multiplying the square footage of a building by a cost per square foot and then adjusting the price to compensate for differences in the building heights, length of the building perimeter, and other building components. •In some cases, a unit other than square footage is used to measure the size of the building (SQM)

Lien Bond

•provided by the prime contractor and indemnifies the owner against any losses resulting from liens filed against the property.

GENERAL CONDITIONS

•published by the American Institute of Architects (AIA) is the most commonly used standard form. •clearly spells out the rights and responsibilities of all the parties. •Certain stipulations regarding how a contract is to be administered and the relationships between the parties involved commonto all construction contracts.

License or Permit Bond

•required of the prime contractor when a state law or municipal ordinance requires a contractor's license or permit. •The bond guarantees compliance with statutes and ordinances.

TAKE-OFF

•scaling or transferring of critical dimensions of construction components from drawings to paper or software that are quantified as units of measurement •includes a description of works that are influenced by the appropriate measurement guide.

Value Engineering

"A systematic approach to achieve the required project functions at least cost without detriment to quality, performance and reliability " • ______ is part of the overall value management process which should be carried out during the pre-contract process mainly during the design stage • Improving the design by encouraging the contractor to make suggestions. • Analyze alternative schemes of achieving the projects objectives in order to delete or reduce non-essential features and lessen the life cycle costs of the projects without sacrificing the quality and integrity of the structure, while maintaining its essential function, performance, and safety.

Descriptive Specification

-General items;materials, products and components; means and methods of installation

SPECIALTY CONTRACTORS

A _______ or subcontractor is a separate contractor hired by the prime contractor to perform certain portions of the work. reduce risk and overhead; contractor gives up a substantial amount of control when subcontracting the entire project.

Profit

A company needs to earn a _________ to grow and survive _______ is a measure of risk - the more risk expected the more _____ needs to be charged Considerations include: project complexity, size, owner, designer, expected competition and workload

• It forms an integral and valuable source of reference for a tender, reducing contractors' tendering costs, and leading to more competition between contractors, which benefits the client • A competitive market is created as contractors and subcontractors are more willing to price work from scheduled quantities rather than prepare measures themselves • Negotiation periods following receipt of tenders are rapid with a quick start on site due to the scope identified in the bills • It assists contract administration to identify and value the works in progress • Rates in the bills are used as a basis for pricing variations • It assists with the preparation of a final account as it sets the basis of the contract sum.

Advantages of BOQ

•Scope of work •Time of completion •Contract sum •Progress payment •Retainage percentage •Schedule of values •Work in place and stored materials •Acceptance and final payment

Agreement Provisions

Estimate

An assessment of the probable total cost of some future activity. •To prepare budget for future expenditures •To try to anticipate what something will cost to implement •Basic approach •Identify the work items that have to be completed to finish the project •Measure the size of these work items •Assess the likely cost of this work

1. Reduces calculation errors 2. Increases the speed 3. Allow the estimator to track where the quantities came from 4. Allows the estimator to quickly change a price or a productivity rate

BENEFITS OF COMPUTERS

Estimator

Be able to read and quantify plans. •Have knowledge of mathematics and a keen understanding of geometry. •Have the patience and ability to do careful, thorough work. •Be computer literate and use computer takeoff programs.

To be an estimator

Be able, from looking at the drawings, to visualize the project through its various phases of construction. • Have enough construction experience to possess a good knowledge of job conditions, including methods of handling materials on the job, the most economical methods of construction, and labor productivity. • Have sufficient knowledge of labor operations and productivity to thus convert them into costs on a project. • Be able to keep a database of information on costs of all kinds, including those of labor, material, project overhead, and equipment, as well as knowledge of the availability of all the required items. • Be computer literate and know how to manipulate and build various databases and use spreadsheet programs and other estimating software. • Be able to meet bid deadlines and still remain calm. • Have good writing and presentation skills.

•Agreement•General Conditions •Supplementary General Conditions (Special Conditions) •Working Drawings •Specifications •Addenda

CONTRACT DOCUMENTS

•Single contract •Separate contracts 1. General construction 2. Plumbing 3. Heating (ventilating, air-conditioning) 4. Electrical 5. Sewage disposal (if applicable) 6. Elevators (if applicable) 7. Specialties 8. Other

CONTRACT SYSTEM

•Value for money • Client specifications • Whole life costs • Influence of design on method of construction and therefore duration • Budget • Design is subjective • Relationship between cost and design

Client Requirements

(a) Errors in addition, subtraction, multiplication, and division. (b) Omission of items such as materials, labor, equipment, or overhead. (c) Errors in estimating the length of time required to complete the project.(d) Errors in estimating construction waste. (e) Errors in estimating quantities of materials. (f) Errors in transferring numbers from one sheet to another .(g) Adding a line to a spreadsheet and not checking to make sure that the new line is included in the total. (h) Errors in setting up formulas, items, assemblies, markups, and so forth in estimating software. (i) Using typical productivity rates and costs from estimating software without adjusting them for individual project conditions. (j) Improper use of estimating software because the user does not understand the limits of the software or the inputs required by the software.

Common errors ESTIMATE

•Setting realistic cost limits •Decide how to spend this money •Check if money is being spent as intended

Cost Planning Objective:

Cost Planning Method -Elemental Cost Planning

Cost of the building is split up into different elements• Element -part of a building which performs a specific function • Substructure • Superstructure • Internal finishes • Fitting and furnishings • Services • External works

• the contractor is reimbursed for the construction costs as defined in the agreement. • However, the contractor is not reimbursed for all items, and a complete understanding of reimbursable and non-reimbursable items is required. • This arrangement is often used when speed, uniqueness of the project, and quality take precedence. • This contract arrangement allows for construction to begin before all the drawings and specifications are completed, thus reducing the time required to complete the project. •Fixed Fee •Fixed Fee with Guaranteed Maximum Cost •Sliding Scale Fee •Fixed Fee with a Bonus and Penalty

Cost-Plus-Fee Agreements

inception pre-contract post-contract operations

Costing at Various Stages of the Project

TURN THE THINKING OVER TO THE COMPUTER, MAKING THE ESTIMATOR NOTHING MORE THAN A DATA-ENTRY PERSON. TO USE THE SOFTWARE FOR A PROJECT THAT IT WAS NOT DESIGNED TO ESTIMATE.

DANGERS OF COMPUTERS

Historical data •Price books •Bill of quantities of previous projects •Final accounts of previous projects •Building cost information service •Trade journals

Data for Cost Planning

•Shape •Grouping of buildings •Number of storeys •Height of each storey •Size •Circulation space •Internal layout •Specifications •Working conditions

Design Factors

Specifications and reports

Documents and Project Information Needed:

Take note of discrepancies, errors, and omissions specifications take precedence over drawings and dimensioned figures, and detailed drawings take precedence over scaled measurements from drawings Check discrepancies with architect or engineer.

ERRORS ANS OMISSIONS

• Person assigned is not sufficiently skilled. • architect/engineer uses the specifications from one job on a second job • Note errors and address properly

ERRORS IN THE SPECIFICATIONS

1. Take off a group of items (an assembly) at the same time. 2. Estimate can be easily and quickly viewed in different formats. 3. Can prepare standard and custom reports, such as materials lists. 4. Changes can be made quickly to the estimates.

ESTIMATING SOFTWARE ADVANTAGES:

1. Expensive and require a substantial commitment 2. Time consuming to set up and maintain

ESTIMATING SOFTWARE DISADVANTAGES:

Amount of work Availability of resources Desirability of the project Borrowing capacity Micro-economics of the tendering

Economic Factors

•Set targets •Monitor progress •Report findings •Agree adjustments

Essentials of Cost Planning

•Design factors •Site factors •Economic factors

Factors affecting the cost of a building

Selection of tendering contractors 3 types: Open tendering Selective tendering Single contractor selection

How to set up the tender

Adjusting for project location Adjusting for construction start date

INDICES

document that states the procedures to be followed by all bidders. states in what manner the bids must be delivered; the time, date, and location of bid opening; and whether it is a public opening. Bids may be either opened publicly and read aloud or opened privately. place where the drawings and the project manual are available and the amount of the deposit required. lists the form of owner/contractor agreement to be used, bonds required, times of starting and project completion, and any other bidder requirements. Proposals Commencement and completion Responsibility of bidders Award or rejection of bid 1. Reject any or all bids 2. Accept a bid other than the lowest 3. Reject any proposal not prepared and submitted in accordance with the contract documents.

INSTRUCTIONS TO BIDDERS (INFORMATION FOR BIDDERS)

•Workers' Compensation Insurance •Builder's Risk Fire Insurance 1. Fire insurance on the contractor's buildings 2. Equipment insurance 3. Burglary, theft, and robbery insurance 4. Fidelity insurance, which protects the contractor againstloss caused by any dishonesty on the part of employees

INSURANCE

Home office overhead costs

Include items that cannot be readily charged to any one project, but represent the cost of operating the construction company • _______ are incurred regardless of any specific project. • Also known as GENERAL OVERHEAD, INDIRECT OVERHEAD COSTS Office •Rent (if owned, the cost plus return on investment), electricity, heat, water, office supplies, postage, insurance (fire, theft, liability), taxes (property), telephone, office machines, and furnishings SALARIES •Office employees such as executives, accountants, estimators, purchasing agents, bookkeepers, and secretaries Miscellaneous •Advertising, literature (magazines, books for library), legal fees (not applicable to one particular project), professional services (architects, engineers, CPAs) not billable to a job, donations, travel (including company vehicles not charged to jobs), and club and association dues Depreciation •Expenditures on office equipment, calculators, computers, and any other equipment not billed to a job. A certain percentage of the cost is written off as depreciation each year and is part of the general overhead expense of running a business. A separate account should be kept for these expenses.

Must figure both wage rate and worker productivity Wage Rate Terms of Union Agreements Overtime/Wage Premiums Worker Productivity Worker Skill Site weather and work conditions Job Schedule

Labor pricing

•contractor agrees to construct the project in accordance with the contract documents, for a set price arrived at through competitive bidding or negotiation. •contractor agrees that the work will be satisfactorily completed regardless of the difficulties encountered.

Lump-Sum Agreement (Stipulated Sum, Fixed Price)

WORK UP SHEETS -used to make calculations andsketchesand to generally "work up" the cost of each item. SUMMARY SHEETS -where all costs contained on the workup sheets are condensed and totaled.

MANUAL TAKE-OFF SHEETS

freight, taxes, time required for delivery, Materials included in the price, terms of payment

MATERIALS

should be broken down into several areas: workup sheets, summary sheets, errors and omissions sheets, proposals received from subcontractors, proposals received from material suppliers and manufacturers' representatives, and notes pertaining to the project. a listing of all calls made to the architect/engineer should be kept together, specifying who called, who was contacted at the architect/engineer's office, the date of the call, and what was discussed. The notebook should be neat and easy to read and understand.

NOTEBOOK

ASSEMBLY ESTIMATE

Rather than bidding each of the individual components of the project, the estimator bids the components in groups known as assemblies.

• accountability • auditability • ensuring everything has been picked up • parity • helping to reduce claims of corruption; and • ensuring that the correct price has been paid for the proposed works

Reasons for robust tendering strategies

Understanding and interpretation of specifications Understanding of market prices and source of pricing data Understanding of factors affecting the cost Knowledge of different estimating techniques

Requirements for Costing

Knowledge in reading and interpreting construction drawings Ability to do manual and electronic measurements Familiarity with materials Knowledge of Standard Method of Measurements

Requirements for Quantification

- identified - analyzed - monitored and controlled

Risks in Construction Industry

List List all activities required for the completion of the project Assign Assign a duration to each of the activities listed in step 1 Write Write each activity and its duration on a "post-it" note and have the construction team develop a network diagram that shows the sequence in which the activities will be performed. Perform Perform a forward pass calculation (this is a schedule calculation) to determine the estimated project duration

SCHEDULING BASICS

Current Records Subcontractor Quotations Vendor Quotations Published Cost Data Old Estimates Experience

SOURCES OF COST INFORMATION

technical economic obsolescence

Service life of an element

• Location • Topography • Geology • Environmental rules and regulations • Site access • Existing services • Existing site use • Size of site • Adjoining properties

Site Factors

CONTINGENCIES

Some items are left out or not foreseen •For price escalation •Often an excuse for poor estimate

• Standard Method of Measurement of Building Works (SMM) • RICS new rules of measurement • Civil Engineering Standard Method of Measurement (CESMM) • Manual of Contract Documents for Highway Works (MCHW) • Standard Method of Measurement for Industrial Engineering Construction

Standard Guides and Codes (Quantification and Costing of Work)

CONSTRUCTION SPECIFICATION INSTITUTE (CSI)

Standard format for organizing the specification known as the MasterFormat

1. Can keep track of where the quantities came from.• 2. Perform the math needed to convert linear dimensions or survey data into areas and volumes.• 3. Drawings can be delivered electronically, reducing copying and delivery costs.

TAKEOFF SOFTWARE ADVANTAGES

1. Lump-sum agreement (stipulated sum, fixed price) 2. Unit-price agreement3 . Cost-plus-fee agreements

TYPES OF AGREEMENTS

1. Competitive bidding 2. Negotiated bidding

TYPES OF BID

• Invitation to tender letter • Form of tender • Contract conditions • Instructions to tendered documents • Project information (preliminaries/works information/employer's requirements) • Design Information • Pricing document • Typical appendices

Tender Documents

Single-stage tendering

The most common type of tendering strategy Invitation to tender documents are issued to a number of competing contractors who are all given the chance to bid for the project based on identical tender documentation

1. Invitation to bid (advertisement for bidders) 2. Instructions to bidders 3. Bid (or proposal) forms 4. Form of owner/contractor agreement 5. Form of bid bond 6. Forms of performance bonds 7. General conditions of the contract 8. Supplementary general conditions 9. Specifications (technical specifications)

The project manual is generally presented in the following sequence:

Group method trade by trade

Two approaches for delegation of duties

• Design -Descriptive specification which the contractor follows and the owner takes responsibility for • Performance -specifies the operational requirements of a component or installation (what the final installed product must be capable of doing) • Proprietary -the exact product or method is specified to ensure a preferred product (require the use of a single approved product type for any particular installation) • Open -very non-restrictive allowing a number of choices

Types of Specifications

Single-stage tendering Two-stage tendering Negotiated tender

Types of Tendering Procedures

A. Modifications to the basic articles of the general conditions in the form of additions, deletions or substitution. B. Additional articles of a contractual-legal nature that may be desirable or necessary for a particular project.

Types of items contained in supplementary conditions:

• health and safety documentation (pre-construction information) • key surveys for the site building (drainage, asbestos, electrical, ecological) • planning permission information • building control documentation • proposed warranty/parent company guarantee/performance bond wording • design responsibility matrix • party wall agreements • building condition surveys; and • risk register (outline which risk the tenderers are expected to take on).

Typical Appendices

•contractor bases the bid on estimated quantities of work and on the completion of the work in accordance with the contract documents. •owner of the contracting agency typically provides the quantity takeoff. •type of contracting is most prevalent in road construction.

Unit-Price Agreement

Early contractor involvement (ECI) -

a form of negotiated tender but emphasis is put on the contractor as the lead designer from the outset of the project

Royal Institution of Chartered Surveyors

a global professional organization that establishes andenforces standards for valuing, operating, and developingassorted types of real estate and property. Property coveredbytheRICScanbeintheformofland,structures,facilities,orinfrastructurecomponents.

QUANTITY SURVEYING

a process of measuring the work of the project in the form of a series of quantified work items.Unit price bid •contractors are all bidding based on the same quantities, and the estimator spends time developing the unit prices.

PRICE

amount paid for goods and service

Philippine Institute of Certified Quantity Surveyors

anall-FilipinoorganizationcomprisedofMembersoftheRoyalInstitutionof Chartered Surveyors (RICS), Members of the Australian Institute of Quantity Surveyors (AIQS), Student and Trainee Members of the RICS,Chartered members of internationally recognized QS professional bodies,QS-trained Engineers who are working towards their QS Study,Assessment of Professional Competence (APC) and Assessment ofTechnicalCompetence(ATC)towardsCharteredMembership.

construction-manager (CM)

contractor is involved in the design process, providing expertise in construction methods and costs, as well as managing the construction process.

Spot item

description of a single item of work on a trade bill that defines the practical aspects of a task

composite item

description of an item that will form part of the new building and which may be measured as a single item or with a unit of measurement.

Building Construction Estimating

determination of probable construction costs of any given project. Working Drawings• Project Manual

Conceptual Stage

drawings are not available or they are very limited. •What exists is often a vague verbal or written description of the project scope, which may be accompanied by a few sketches.

Indirect cost

general conditions or project overhead

Job overhead costs

include all overhead expenses that will be incurred as a result of executing a specific project. Also referred to as general conditions, direct overhead, or indirect field costs, Comprises all costs that can be readily charged to a specific project but not to a specific item of work on that project • Salaries • Temporary office • Temporary building, barricades, enclosures • Temporary utilities • Sanitary facilities • Drinking water • Surveys • Cleanup • Winter construction • Protection of property • Photographs

DETAILED ESTIMATE

includes determination of the quantities and costs of everything that is required to complete the project. •includes materials, labor, equipment, insurance, bonds, and overhead, as well as an estimate of the profit. •contractor must have a complete set of contract documents.

A specialty contractor or subcontractor

is a separate contractor hired by the prime contractor to perform certain portions of the work. Reduce risk and overhead; contractor gives up a substantial amount of control when subcontracting the entire project.

Tendering

is an important phase in the procurement strategy but procurement involves much more than simply obtaining a price. • ________ is: • the bidding process, to obtain a price; and• how a contractor is actually appointed.

Procurement

is the overall act of obtaining goods and services from external sources (i.e. a building contractor) and includes deciding the strategy on how those goods are to be acquired by reviewing the client's requirements (i.e. time, quality and cost) and their attitude to risk.

Direct costs

material, labor, equipment, subcontractor

Two-stage tendering

often used where time is constrained used if the design process would benefit from the technical input of a contractor in the later design stages. used to obtain the early appointment of a contractor

value

payment for a completed deliverable