Estimation is the process of establishing the likely cost of supplying work, goods or services in an approximate way, usually before full design or pricing information is available.
On UK construction projects estimating takes place throughout the design stages and becomes more detailed as information develops. At the earliest stages the QS uses methods such as the functional unit or floor area method to produce an order of cost estimate; this is then refined through elemental cost plans and, finally, a pre-tender estimate. Contractors’ estimators carry out a related but different exercise when pricing a tender, building up rates from labour, plant, materials and subcontract quotations. The accuracy of any estimate depends on the quality of the information, the cost data used and the allowances made for risk and inflation, so assumptions and exclusions should always be stated.
Related terms: Order of Cost Estimate, Cost Plan, Pre-tender Estimate, Cost Prediction.
