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The College of Estate Management 2004

Paper 1114V6-0

Cost planning and pre-contract cost control

Learning outcomes
Part A: The need for cost control
1. Introduction
2. Controlling the design
3. Cost control activities
Self-Assessment Question 1
Part B: Cost information

Cost analysis
Items included in elements
Comparison of analyses
Other sources of cost data
Self-Assessment Question 2

Part C: Preliminary estimates

1. Introduction
2. Methods of estimating
3. Pre-contract estimating
Self-Assessment Question 2
Part D: Detailed cost planning

Elemental cost planning
Comparative cost planning
Cost planning in use
Self-Assessment Question 3

Appendix: Sample cost analyses

Answers to Self-Assessment Questions

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To consider the relationship of the design process and cost planning and
control of cost limits.

To introduce elemental cost planning.

Learning outcomes
After studying this paper you should be able to:

Describe the relationship between cost planning and design.

Identify how cost limits may be established for buildings.
Prepare a preliminary estimate using the different methods.
Understand the aims and types of cost planning.
Advise on alternative schemes using comparative cost planning.

To be effective, a pre-contract cost control system must operate throughout the whole
design process, from the inception of a project to the tender analysis.
Part A of this paper deals with the overall design process and the relationship of cost
planning to this process. As all estimating relies on cost information, Part B covers
cost analysis, cost data, and cost indices. The cost planning procedure includes setting
or confirming a cost limit in the initial stages of design, and this is also covered in
Part B. Once approval to proceed has been given, a more detailed estimate may be
prepared and this is dealt with in Part C. As the design develops, elemental cost
planning may be introduced, and this is covered in Part D.

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Part A: The need for cost control

1. Introduction
2. Controlling the design
2.1 Cost planning
3. Cost control activities
3.1 Outline proposals
3.2 Design stage
Self-Assessment Question 1

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1 Introduction
It is vital to keep the total cost of a development within a clients budget and, for this,
efficient control of the design process is a prerequisite.
The need is now possibly greater because:

profit margins have become smaller and therefore variations in cost or time can
seriously affect project viability;

clients are becoming both larger and more aware and therefore expect more
from their advisers;

projects have become more complex, needing greater control;

quality is expected in design and materials.

The control mechanism should comprise a cyclical system of initial planning which is
then monitored and reported on. Any adjustments required are made, and the revised
plan continues to be monitored, adjusted and so on. Without the review and
adjustment, there is no control.

For a cost control process to be effective, the quantity surveyor should be involved as
early in the process as possible. The earlier he makes his contribution, the more
effective he can be.
The cost plan needs to be realistic. It should be established early on in the design
process. As the design evolves, each drawing is cost checked and any differences
reported to the client and architect. Changes to the design may mean that changes are
required to the cost plan to bring the project back within budget, or the budget may
need to be increased.
For a cost control process to be effective, the quantity surveyor must ensure that all
parties are aware of design implications early on and action taken collectively so as
not to compromise the clients objectives.
There must be more flexibility in the early stages of design than in the later stages:
fewer firm decisions have been made, and there is more chance of affecting the cost.
Once firm decisions have been made on shape, form etc, fewer sections are left to be
decided and significant variation in costing is less likely.

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2 Controlling the design

Once a proper control system is adopted, the surveyor should be able to advise the
client on how much to spend, how to allocate his money to the different parts of the
building to get a balanced design solution within the financial restraints, and
eventually to confirm that the money is being spent as planned.
An effective control method may be necessary for a number of reasons:

The client may have limited funds.

In a public sector project, a cost limit may be laid down.

In a commercial development, the client may be governed by the possible

income generated by the project.

One of the problems of designing a building is maintaining control over costs while
design decisions are being made. To aid this, cost planning was developed.

2.1 Cost planning

The full cost planning process is designed to achieve a balanced expenditure and
control the design development so that the clients financial commitments are met.
The process can be divided into three main parts:

To set a realistic cost limit (see Parts B and C).

To decide how this money is to be spent (see Part D).
To check that the money is being spent as intended (see Part D).

The process should achieve a good, balanced design solution, cover all the clients
requirements and be carried out throughout the whole design period.

3 Cost control activities

The traditional design procedure for a building, from the time an architect is
appointed to the completion of the project, may be broken down into several stages.
These stages will vary, both in the length of time and in the operations necessary,
depending on the circumstances of the project.
The architect and client are the only members of the design team who are interested
in the success of the building as a whole rather than any particular aspect. All other
members of the team have their own bias, the quantity surveyor being primarily
interested in cost. The design stages indicated in Figure 1 are based on those
suggested by the RIBA Plan of Work, but other stages are possible if a different form
of design method is used.

3.1 Outline proposals


The quantity surveyor should be ready to provide analyses of similar projects

(see Part B) and discuss these and other cost problems with the design team.

The architect experiments with various planning solutions, taking into account
the clients requirements, circulation, specialist works and the general cost

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The architect prepares an outline scheme based on the main dimensions.

The quantity surveyor makes a further check to see whether it is likely to be

within the cost limits set by the client, or, where no limit is set, gives a
preliminary estimate of the cost. (The preparation of estimates is dealt with
separately in Part C.)

3.2 Design stage

This is in two subdivisions: scheme or sketch design, and detail design.
1 Scheme or sketch design

The architect completes his study of user requirements for the building, prepares
scheme designs and passes them to the quantity surveyor. It is unlikely that only one
scheme will be drawn out the architect may draw fittings layouts to ensure that the
rooms are of a suitable size. The specialist engineers should provide essential details
(eg boiler room sizes). The architect will probably have decided generally on the type
of frame, walling, roofing etc.
The quantity surveyors work at this stage will depend on the procedure agreed with
the architect. If cost planning has been decided upon, it may be in elemental form,
comparative form, or, as is often the case, a mixture of the two. This is discussed in
depth in Part D.

Elemental cost planning. The quantity surveyor prepares an outline plan from
previous analyses at the beginning of the scheme design stage and submits it to
the architect for discussion. After the plan has been checked against the
scheme design drawings, it is put into its final form.

Comparative cost planning. Before the architect settles on the scheme design,
the quantity surveyor makes cost studies of various alternatives that the
architect suggests he might use. The architect then makes a choice and
completes his scheme designs. On receipt of the scheme designs, the quantity
surveyor prepares an elemental cost plan based on his earlier cost studies.

At the end of the scheme design period, the architect prepares his presentation
drawings for the client.
2 Detail design

The architect checks the specialist drawings to see that they fit in with the general
scheme, and prepares his own detail drawings.
Where elemental cost planning is used, the detail design period is a busy time for the
quantity surveyor. As each detail drawing is prepared by the architect, he should send
it straight to the quantity surveyor, who will make a cost check to see that the value of
the elements in the cost plan are not being greatly exceeded (or reduced). If there is a
discrepancy, the quantity surveyor should inform the architect and suggest alternative
solutions that will allow the cost plan to be adhered to. The architect may accept one
of the alternative solutions, provide one of his own, or, with the agreement of the
client, alter the target figure.
When all the design drawings have been prepared and cost checked, the quantity
surveyor should make a final cost review and submit a report to the architect and

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The relationship between the plan of work and the cost planning process is shown in
Figure 1.
The process of value management is also a pre-contract cost control procedure, but
space in this paper is limited and a separate paper is included if your module requires
you to have a knowledge of the procedure.
What is the purpose of pre-contract cost control?
Answers to SAQs are to be found at the end of the paper.

FIGURE 1 Cost procedure chart


Establish Cost
Cost limit studies



Techniques Preliminary
unit, cube,

Prepare Prepare
cost plan cost checks
based on

Feasibility Outline Sketch

proposals design





Working Bill of
drawings quantities stage
of tender

reporting/ final
cash flow account

up to

Project Operations Completion Feed

planning on site
tracking of

Cost planning and pre-contract cost control

Part B: Cost Information

1. Introduction
2. Cost analysis
2.1 Purpose of a cost analysis
2.2 Preparation of a cost analysis
2.3 Wall to floor ratio
2.4 Quality factor
2.5 Preliminaries and contingencies
3. Items included in elements
4. Comparison of analyses
5. Other sources of cost data
5.1 Reliability of cost information
5.2 Information library
6. Indices
Self-Assessment Question 2

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Cost planning and pre-contract cost control

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1 Introduction
The basis of any cost control system is a suitable library of cost information,
including cost analyses and other sources of cost information, all suitably classified to
allow easy access.
When preparing a cost plan it is important to understand how the cost information it
is based on has been collected and why you might want to adjust the information.

2 Cost analysis
A cost analysis is a systematic breakdown of cost data to facilitate examination.
The method used for building works is generally to:

Analyse the cost of the project in terms of functional elements (eg foundations,
external walls, roof etc) by reference to the priced bill of quantities. Many bills
of quantities are originally prepared in trade order and the costs need to be
broken down and reassembled into an elemental order.

Break down the total cost of each element and express it as a cost per square
metre of gross internal floor area. The gross floor area is the total area within
the internal structural face of the enclosing walls.

Where a bill of quantities is not available, the contract sum analysis may be further
analysed to provide basic cost data. It may not be possible to make a full analysis
following the Building Cost Information Service (BCIS) guidelines (given later in
this paper).
The gross floor area is used as a yardstick because:

it represents something useful to the client a near approximation to the

amount of accommodation provided in the building;

it provides a convenient comparative measure between similar projects;

it is relatively easy to measure on all jobs irrespective of their size, shape or


The total cost of each element divided by the floor area is called the elemental cost
per square metre.
The quantity of each element (eg the surface area of windows) in square metres is
also usually given in the analysis where practical and this is called the quantity
factor for the element (sometimes also known as the elemental unit quantity or
The total cost of the element divided by the quantity factor is called the elemental
unit cost. Take care not to confuse this with the elemental cost per square metre.
In addition to the purely mathematical data, other information that might affect costs
should be recorded in the analysis. Examples include:

Qualitative issues expressed in a brief description of materials used, design

considerations, soil conditions etc. In detailed analyses, where there are several
types of construction within an element, the quantity of each main type should
be indicated.

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Contextual issues date of tender, type of contract, parties to the contract,

contract period, brief description of the work, and any particular market
considerations, such as shortage of labour in the area.

Accommodation details gross floor area, usable area, circulation area,

ancillary area (area of toilets, lifts, plant rooms etc), and the area taken up by
internal walls and partitions.

A set of plans and elevations, together with suitable photographs, would help in using
the analyses.
In general, items should be included in the same element every time, but because of
the large variations in building types and construction this is not always possible.
Where items are included in elements which are different from the normal, state this
fact in a note against both the element in which they are included, and the element in
which they are normally included. For example, windows in curtain walling are
included in the external walls element, so this should be stated in this element and a
note made against the window and external door element that these are included in
external walls.
In every cost analysis, list all the elements so that the element numbers remain the
same for reference and comparison purposes. Where there is no cost attributable to
the element, write nil against the element in the cost column.
Unusual or difficult items (eg canopies) should be included with the most appropriate
item. Where they are of significant cost importance, give details.
Detached or mainly detached chimney stacks should be included in heat source
element. Stacks attached to the structure should be included with the most appropriate
element (eg external walls, internal walls or partitions).
The cost of tank rooms will normally be divided between the various elements
(external walls, roof etc) and tank casings will be added into the builders work in
connection element.
Decorations should be allocated to the appropriate element. Decoration on fair-faced
work should be included in the appropriate finishings.
Analyses are generally based on the tender figures. Cost data can be obtained quite
easily from priced bills of quantities. The time lag between receipt of tenders and
preparation of an analysis should be short so that the information obtained is as up to
date as possible.
Modification notes may be added to an in-house analysis when the final account has
been prepared. These may include details of large cost variations caused by remeasurement or adjustment of prime cost and provisional sums.
A concise cost analysis is used when cost planning at feasibility stage. As few design
features would be known at this stage, it is not necessary to break the costs down into
detailed elements. An example is included in the Appendix at the end of this paper.
As the design develops, it is important to choose a detailed cost analysis that closely
relates to the proposed project, and as much information as possible is required so
that an informed decision on cost allocation can be made. This detailed cost analysis
enables the quantity surveyor to make adjustments for factors which will affect the
cost of the proposed elements more accurately.

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The following section gives detailed guidance on how to prepare an analysis. You
will not be assessed on the preparation procedure. It is purely to demonstrate how the
figures are established. You will be assessed on sections 4 onwards.

2.1 Purpose of a cost analysis

The purpose of a cost analysis is to reveal the cost relationship between different
sections of a building and to allow one building to be compared with another. The
analysis should bring out those features in different buildings that bear most heavily
on costs and may require special attention in design. It represents a series of facts but
does not state whether one building is better or worse than another. Analyses are
normally used to help in the preparation of cost plans for future buildings, but might
also be used to compare different design solutions.
In order to use cost analyses effectively it is necessary to understand how the project
costs have been analysed. A standard approach to analysing bills of quantitites was
established by the Building Cost Information Service (BCIS) of the Royal Institution
of Chartered Surveyors. Their list of elements and allocation of costs has been widely
adopted so that a reasonable size data base can be established. By having a standard
approach to the analysis you can be confident in using the figures for the preparation
of a cost plan.

2.2 Preparation of a cost analysis

Many cost analyses are produced by computer if the bills of quantities have been
produced using a comprehensive bill package. If items are coded carefully when
initially measured, it is a simple process to enter the bill rates from the successful
tenderer and then re-sort the bill into elemental order. All the financial information
for a cost analysis is then printed out.
The following items are generally required for the manual preparation of an analysis:
1. The priced bill of quantities submitted by the accepted tenderer with any errors
2. A priced list of any adjustments agreed before the contract is signed.
3. Details where possible of the build-up of provisional and PC sums.
4. Copies of the plans and elevations.
5. The dimension sheets.
6. If the details of the contract are not included in the bills of quantities, the
contract documents may also be required.
When preparing the analysis:

Each element heading is placed at the top of a column. Generally abstract

paper is suitable for this. By systematically going through the bill and any
reduction bill, items may be allocated to one or other element. Where groups
of items are all in the same element (eg excavation and earthworks), only the
total cost needs to be entered on the analysis sheet.

Transfer the figures obtained to a separate sheet see Figure 2 for a typical
layout. The total floor area of the building is obtained from the drawing (or
from the description in the bill of quantities). The total cost and the totals of
each element are divided by the floor area in square metres. The elemental
costs so obtained are also entered on the sheet. The element unit quantities are
totalled and written on the summary sheet. The element unit rate can then be

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FIGURE 2 Summary of amplified analysis

Gross internal
Floor area ...........................

Number and
name of
included in
this column

Date of tender

Total cost of

Cost of
element per
m of gross
floor area

Element unit

Total cost of
each element
and also the
cost of the
group elements

Cost per m of
each element
and for the

factors included
here where

Element unit

Column A
divided by
Column C

In some cases an additional column is included between columns B and C showing

the percentage of the total cost that each element represents.
The amplified cost analysis itself is set out on sheets similar to those shown in Figure
The analysis should be accompanied by any other details that have not been stated
elsewhere, including a copy of the contract drawings and any informative
photographs of the completed building.
FIGURE 3 Amplified cost analysis
Element and

cost of

Cost of
per m of


unit rate


Items as included in the Summary

Number and
name of
other ratios

Main specification
including areas,
numbers, costs etc
of some of the all-in
unit rates
total cost of item

Each element in the amplified analysis should have a brief specification covering the
design criteria. This information may be obtained from the bills of quantities, though
in some cases reference to the drawings may also be necessary (eg details of the
frame). In some cases the cost of the element should be broken down into subelements.

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Each analysis should have a front sheet containing the following details:
1. Reference numbers.
2. Description of type of building (eg hospital).
3. Name of client and architect. (Engineers and contractor are also sometimes
included, and quantity surveyor if the analysis is for other than personal office
4. Name and address of project.
5. General description of the works. This should be similar to that included in the
bill of quantities and should include number of storeys, and details of items of
construction likely to have a major effect on cost. The main items included in
the external works should be stated.
State also whether any normal items are omitted (eg foundations included in a
separate contract) and whether the access, topography or geology of the site is
6. Total gross floor area, measured to the internal surfaces of external walls, and
over internal partitions, internal structural walls and stair wells. Area of opensided verandahs etc should be given separately and not be used for calculating
cost per square metre of floor area. However, verandahs incorporating screen
walls, proper floor finishes etc, providing almost normal accommodation,
should be included in the measurement of floor area.
7. Details of area etc. Give a breakdown of the gross area into basement, ground
and other floors, with approximate lengths and widths where appropriate. Also
give storey height and/or the heights of various parts of the building. The total
area should be broken down into usable, circulation, ancillary and internal
division areas. The ratio of usable space to other sundry spaces gives an
indication of planning efficiency.
As a further guide to planning efficiency of two similar-sized buildings, the
wall to floor ratio (described below) may be included. The internal cubic
capacity may also be given. This is the gross internal floor area of each floor
multiplied by its storey height. Note that the method of calculating the cube for
this purpose is different from that used for estimating purposes.
8. Approximate percentage of the building that is single-storey, two-storey, threestorey etc. Plant, tank and similar rooms above the main roof should be
ignored for this purpose. The different storey heights should be stated
separately with details of where each occurs. The storey height of single-storey
buildings and of top floors of multi-storey buildings is measured from floor
finish to underside of ceiling finish; in other cases it is floor finish to floor
9. Type of contract and contract period; whether open or negotiated tender; and
whether firm price or fluctuating. Details may be given here of the number of
tenderers, the spread of tenderers and approximately how far below the next
tender the accepted one was. This information is useful for spotting freak

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10. Total tender price.

11. Date of tender.
12. Market conditions in the area at the time of tendering.
13. Number of functional units: eg net usable floor area for offices and factories;
units of accommodation for schools (places), hostels (beds), dwellings
(persons) etc. The total cost of the project less external works should be
divided by the number of functional units and stated as the functional unit cost.

2.3 Wall to floor ratio

The wall to floor ratio is obtained by dividing the external wall area measured over
windows and doors by the total floor area. This gives a ratio that is useful for a quick
comparison of buildings, particularly in the early stages of a job when alternative
planning solutions to obtain the same floor area are being considered. However, while
the wall/floor ratio does give a reasonable indication of the efficiency of a buildings
shape for a given floor area, it is not a measure of planning efficiency between
buildings of substantially different floor areas, because the bigger any given shape,
the lower the perimeter/area ratio becomes.

2.4 Quality factor

The quality factor can be included in the analysis in the form of specification notes,
with details of the relevant areas and unit costs for the main items within an element.

2.5 Preliminaries and contingencies

Opinion differs as to whether preliminaries should be kept separate in the analysis or
whether they should be spread on a proportionate value basis throughout the other
Preliminaries may cover more than varying overheads (foreman, use of plant etc).
They may reflect access and storage conditions, phasing, difficult labour areas, and in
some cases may include profit and general overheads (eg builders establishment
costs). Because firms methods differ, it may be an advantage to spread the
preliminaries throughout the elements for comparison purposes. On the other hand,
by keeping them separate the architect will have a better indication of how much has
been allocated to any section of the work.
In the elemental summary, separate sets of figures may be calculated to include the
preliminaries separately, with a separate set of columns to show the preliminaries
apportioned among the elements. In the breakdown of an amplified analysis, the
preliminaries should be shown as a percentage of the remainder of the contract sum.
The value of preliminaries and some other items will depend upon the tendering
procedure to be used and the type of contract.
Competitive tendering using open competition generally results in the lowest
possible tender figure being obtained. However, the standard of work achieved using
this method may be lower than with selective tendering, resulting in delays, expense
due to loss of production in the case of factories, or increased user costs resulting
from bad workmanship.

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Selective tendering should produce the desired standard of workmanship, as the

architect will consider this when making his choice of firms. Because of the limited
competition, the tender figure may be slightly higher than with open tendering, but
this may reflect the cost of improved supervision and craftsmanship.
Negotiated tendering may be used to gain the advantages from appointing the
contractor at an early stage in the project. The contractor can help the architect in
design, and obtain economies by allowing for the use of available plant and using
methods of construction familiar to the firm and work people. Unfortunately, because
of lack of competition, most negotiated contracts seem to work out more expensive
than similar contracts using competitive tendering.
Negotiated contracts are sometimes used for development on the same site as a
project already in progress, or on an adjacent site. They may result in savings, as the
contractors site organisation for the first contract may be used for the new one.
If cost planning procedures are carried out, some form of lump sum contract is
likely to be used, though schedule contracts and cost reimbursement contracts may be
used in exceptional cases. The form of contract used may affect the cost. The type
that places most responsibility on to the contractor is likely to be the most expensive.
If the contract does not contain a fluctuations clause (ie a firm price contract) then
the estimator must make his own estimate of future market conditions and allow for
any increases in his tender price. The difference in tender figure between a contract
with a fluctuations clause and one without may be considerable, depending upon the
length of the contract and the estimators anticipation of market trends. When cost
planning, the quantity surveyor should note carefully whether a firm price or a
fluctuation type contract has been allowed for.
The time allowed for a project may also affect the tender figure. Some overhead
costs (eg erecting huts) may remain constant no matter how long the contract.

If a large amount of overtime is necessary to complete the project on time, this

will result in a higher tender figure.

The total cost of items such as foreman will increase with the length of

With a short contract period, there may be difficulty in obtaining completed

drawings when required, unless the project has been very well planned.

Short contracts carried out in the winter months may involve extra costs due to
the weather conditions.

3 Items included in elements

Table 1 indicates some of the information that should be included in an amplified
analysis if prepared in accordance with the BCIS rules.

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TABLE 1 Information to be included in an amplified analysis

Element and
design criteria
1 Substructure
Permissible soil
loading, nature of
the soil, depth of
bearing strata, the
site levels and the
depth of water
table should be
given. The
foundation areas of
sections of the
building which are
of different heights
should be stated
separately in the
breakdown. Total
load and average
load on piles
should be stated.

General notes and examples

Includes items up to the underside
of the lowest floor screed. It
includes basement floors but NOT
basement walls (see external
walls). Stanchions and columns
together with their casings are
included with frame element and
not in substructure. The cost of
piling and driving is shown
separately in the breakdown
stating the type of system, the
number of piles and their average
length. Examples of how the type
of information is given is shown

soil loading
Nature of
Depth of

Depth of
water table
Site levels
2.1 Frame
A note should be
given of the grid
pattern and column
centres in both
The total floor area
in each height of
frame, together
with design loads
and storey heights,
should preferably
be stated
separately in the

Main items included in element

Area of
in m

Excavations and disposal

Planking and strutting
Concrete in foundations, ground
beams, and column bases
Floor slab
Duct covers
Area retaining walls, pavings and
Sleeper walls
Joist and boarding to suspended
ground floors
Steps or ramps in floor slab

floor area
in each
and type
of frame

Steel or concrete frame including

main floor and roof beams
Trusses of framed buildings
Mortices for holding-down bolts
Holding down bolts and grouting
Concrete casing to steel
Trimming for staircases
Piers should be included with
External walls or Internal walls
and partitions
Beams supporting roofs or floors
of unframed buildings should be
included with Upper floors or
Roof structure
Filler joists should also be
included with Upper floors or
Roof structure

40.00 kN/m
Soft clay with
patches of sulphate
bearing soil
designed on partial
friction and partial
bearing basis)
No water table
Gradient 1 in 20

The cost of the frame where the

building is used for different
functions and/or where different
number of storeys should be
preferably given separately in the

of storeys
Total floor


3.000 m 3.000 m
17.00 m 7.000 m

3.00 kN/m

7500 m

650 m

4.000 m
to eaves)
7.050 m
to ridge)

3.000 m
First floor
2.800 m
(Floor to

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples


2.2 Upper floors

Design load and
spans should be

The area and cost of suspended

floors in and over basements are
included in this element. Net area
only should be measured and stairwells etc deducted. The cost of
access and private balconies
should be given separately in the
breakdown. The cost of suspended
floors in or over basements should
be given separately in the

2.3 Roof
Design loads and
spans should be
The angle of pitch
should be stated
for sloping roofs

Area on plan is measured overall

to the edge of the eaves and voids area of
caused by rooflights etc are NOT roof m
Cost of plant rooms on roofs
should be broken down and
allocated to the appropriate
elements. The cost of rainwater
downpipes is NOT included in this
element but should be added to
Internal drainage. This element
should be broken down into four

Roof structure
Roof coverings
Roof drainage
Roof lights

area of

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Main items included in element

Beams to floors other than those in
Concrete or hollow tile floors
reinforcement to floors
Formwork to floors
Plates, joists and boarding
affording platform to upper floors
Filler joists to floors
Structural screeds to floors
2.3.1 Roof structure
Wall plates and roof timbers
Roof trusses other than those in
Eaves construction and fascia
Gable ends
Internal walls above plate level
Chimneys above plate level
excluding isolated chimneys
Parapet walls and balustrades
Concrete or hollow tile roofs
Reinforcement ro roofs
Formwork to roofs
Filler joists to roofs
Beams to roof other than those in
2.3.2 Roof coverings
Underfelt and battens
Tiling, slating etc
Roof screeds
Waterproof roof coverings
Flashings and trims
Roof insulation material
2.3.3 Roof drainage
Rainwater heads and roof outlets
2.3.4 Roof lights
Lantern lights
Framework and kerbs to the above
Opening gear

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples


The cost of external escape

staircases should be given
separately in the breakdown. If the
The number and
staircase structure is included with
the total vertical
the Frame or Upper Floors this
height of each
should be stated in this and the
staircase and its
elements concerned.
width between
stringers should be Cost of landings at floor levels
should be included with Upper
Floors. This element should be
broken down into three subelements:
2.4 Stair

Includes basement walls but NOT

internal finishes, windows, doors
to shop fronts. Walls are measured
on external face and the height is
measured from the underside of
ground floor screed (or basement
=_____________ screed in the case of a basement
wall) to plate or eaves level (or
Basement wall in underside of ground floor screed
for basement wall).
Gross floor area in
Windows and door openings
should be deducted from overall
The approximate
U value should
be given in
W/m C
If calculated loadbearing brickwork
give indication of
structural loading

In the breakdown the costs, areas

and unit rates for basement walls
and for different types of walls
should be given separately.
Structural walls forming an
important part of the loadbearing
formwork should be given
separately. If walls are selffinished internally this should be

Main items included in element

2.4.1 Stair structure
Stair construction
Cat ladders
External staircases
2.4.2 Stair finishes
Finish to treads and risers
Finish to landings
Finish to ramps
Finish to aprons and strings
Finish to soffits

2.4.1 Stair structure

2.4.2 Stair finishes
2.4.3 Stair balustrade and
2.5 External
External wall in m
Gross floor area in

Paper 1114 Page 20

2.4.3 Stair balustrade and

area of
walls m

Brickwork excluding gables and

parapet walls
Fair face and facings
Applied external finishes
Plinth and string courses
Sheeting and sheeting rails
Curtain walling and back up walls
to curtain walling
Basement walls
Vertical tanking

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples


2.6 Windows and The area should be measured the

full opening in the wall
external doors

area of
Windows in m In the breakdown the costs, areas and
Gross floor area in and unit rates for different types of external
windows (eg wood and
doors m
aluminium) should be given
=_____________ separately
External doors in This element should be broken
down into two sub-elements.
Gross floor area in
2.6.1 Windows
2.6.2 External doors

Paper 1114 Page 21

Main items included in element

2.6.1 Windows
Metal windows
Wood windows
Shop fronts
Frame and sills, cover fillet etc
Glazing and panel infilling
Backing up walls to windows
Lintels and cavity dpcs
Work to reveals of openings
2.6.2 External doors


Fanlights and sidelights
Frames and thresholds, linings,
architraves etc
Glazing and panel infilling
Cramps and dowels
Lintels and cavity dpcs
Work to reveals of opening

The area of
opening lights to
windows should be

2.7 Internal walls Openings should be deducted from Total

overall area.
area of
and partition
Internal walls and In the breakdown the costs, areas walls
partitioning in m and unit rates for different types or and
Gross floor area in thicknesses of internal walls and
partitions should be given
Structural walls forming an
important part of the load-bearing
framework should be given
Items forming part of crosswall
construction should be given
The number of proprietary WC
cubicles should be stated.
Doors etc in proprietary partitions
should be included and the number
If proprietary partitions are self
finished this should be stated

Concrete walls together with the

reinforcement and formwork
Fair face and facings
Chimneys forming part of internal
walls (up to plate level)
Patent partitions including doors
etc included in the partitions
Sliding and folding partitions
Borrowed lights
WC cubicles including doors
Glazing to above items
Internal balustrades not forming
part of a staircase or landing.

Cost planning and pre-contract cost control

Element and
design criteria
2.8 Internal

General notes and examples


The area should be measured the

full opening in the wall or partition area of
Doors to WC partitions, doors in
doors m
proprietary partitions and those
forming part of sliding or folding
partitions are NOT included in this
element and should be allowed for
in Internal walls and partitions.
In the breakdown the costs, area,
unit rate and number of each type
of door should be given separately.
The number of single and double
doors should preferably be stated

3.1 Wall finishes

Include all preparatory work,

backings and finishes to internal
wall surfaces.
In the breakdown the costs, areas
and unit rates for the main types of
finish should be given separately.
The finishes to the inside of
external walls should be given
separately. Fair face and facings to
brick, block and concrete walls are
NOT included in this element and
should be allowed for in External
walls or Internal walls and

area of
finish m

Main items included in element

Doors other than those mentioned
in column two
Fanlights and sidelights
Frames and linings
Architraves and stops
Cramps and dowels
Work to reveals of openings

Backings for tiling etc
Wall tiling, mosaic
Insulation forming a wall finish
Non-structural column casings
where not required for protective
Battening out
Picture and dado rails

3.2 Floor finishes Includes all preparatory work,
beds and finishes to floor surfaces. area of Screeds
In the breakdown the costs, areas finish m
and unit rates for the main types of
finish should be given separately.
The finishes to staircases are NOT
included in the element and should
be allowed for in Stairs element.
Structural screeds and boarding to
timber framed floors are NOT
included in this element and
should be allowed for in Upper
floors or Substructure as

Paper 1114 Page 22

Cost planning and pre-contract cost control

Element and
design criteria
3.3 Ceiling

General notes and examples

Includes all preparatory work and
finishes to surfaces of soffits.
In the breakdown the costs, areas
and unit rates for the main types of
finish should be given separately.
If a ceiling is used principally as a
source of heat or artificial light or
for ventilation it should be
included in the appropriate
Services element and a note made
here and in the service element.

area of
finish m

Paper 1114 Page 23

Main items included in element

3.3.1 Finishes to ceilings
Beam casings, where nonstructural
Roof light linings
3.3.2 Suspended ceilings
Suspended ceilings and beams

The finishes to soffits of staircases

are NOT included in this element
and should be allowed for in
Stairs element. The finishes to
soffits immediately below the roof
should be given separately. The
element should be broken down
into two sub-elements
3.3.1 Finishes to ceilings
3.3.2 Suspended ceilings
4.1 Fittings and

This element should be broken

down into four sub-elements
4.1.1 Fittings, fixtures and
4.1.2 Soft furnishings
4.1.3 Works of art
4.1.4 Equipment

4.1.1 Fittings, fixtures and

Storage and equipment shelving
Curtain tracks
Blind boxes and pelmets
Servery counters
Kitchen hatch
Storage racks
Built-in cupboards
Fixed cupboards
Kitchen benches and tables
Pin boards
Sun blinds
4.1.2 Soft furnishings
Loose carpets
4.1.3 Works of art
4.1.4 Equipment
Non-mechanical and nonelectrical equipment
Gymnasium equipment

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples

In the breakdown the costs,

number and unit rates for each
type and quality of fitting should
Number of persons be given separately.
of each sex served
should preferably Builders work is NOT included in
this element but in a separate
be stated in the
element of that name (5.14)
case of industrial
and commercial
buildings. Whether
the fittings are
grouped or
dispersed should
be stated.
5.1 Sanitary


Paper 1114 Page 24

Main items included in element

Sanitary fittings (excluding traps
except where supplied with
Towel rails (other than hot water
Toilet roll holders.

5.2 Services

In the breakdown the costs,

number and unit rates for each
type and quality of fitting should
be given separately. Builders
work is NOT included

Kitchen equipment
Laundry equipment
Hospital and dental equipment

5.3 Disposal
Number of sanitary
appliances served
and special
equipment should
be stated.

This element should be broken

down into two sub-elements:

5.3.1 Internal drainage

Waste and soil pipes, traps
Stack pipes as far as gully or joint
to drain. Vent pipes
Floor channels and gratings
Rainwater downpipes

5.3.1 Internal drainage

5.3.2 Refuse disposal
Builders work is NOT included

5.3.2 Refuse disposal

Refuse ducts
Local incinerators together with

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples


Cold water supply and header

tanks for heating systems are NOT
included in this element and
should be allowed for in Heat
The number of
source. Pipework and fittings for
cold- water, hotsteam distribution for space
water, steam and
condensate draw- heating are NOT included in this
offs should each be element and should be allowed for
stated separately. in Space heating and air
This size of
cisterns, cylinders This element should be broken
down into four sub-elements:
etc should
preferably be
5.4.1 Mains supply
5.4.2 Cold water service
5.4.3 Hot water service
5.4.4 Steam and condensate
5.4 Water

Paper 1114 Page 25

Main items included in element

5.4.1 Mains supply
Piling from entry into the building
up to (but not including) the
storage cistern or draw-off taps,
valves and meters etc on the above
Insulation to above
5.4.2 Cold water service
Storage cisterns
Cold water distribution pipework
Valves other than those forming
part of sanitary appliances
Insulation to these items
5.4.3 Hot water service
Hot water and mixed water
distribution pipework
Valves other than those forming
part of sanitary appliances
Instantaneous heaters
Insulation to these items
5.4.4 Steam and condensate
Steam distribution other than that
for space heating
Condensate return other than that
for space heating
Valves and insulation in
connection with these items.

If the gas service is provided

primarily for heating it should be
included here. In the breakdown
The boiler rating
should be stated in the cost of each form of heat
source should be given separately.
5.5 Heat source


Independent chimney stacks and
Fuel conveyors
Header tanks and the cold water
supply in connection
Fuel tanks
Insulation to boilers etc

Cost planning and pre-contract cost control

Element and
design criteria
5.6 Space
heating and air

General notes and examples

The type of system (inlet, extract
etc) used for air treatment should
be stated. Where there is a
combination of treatments eg
heating, cooling, dehumidifying
etc this shall be stated.

Area of
treated in m
Gross floor area in The element should be broken
down or allocated to one or more
of the nine sub-elements in
=_____________ column four.

Cube of
floor area
of section
by its
finish to
finish or,
in the
case of
and top
floors of
finish to
finish) m

Paper 1114 Page 26

Main items included in element

5.6.1 Water and/or steam
Pipe coils
Distribution pipework to above
5.6.2 Ducted warm air heating
5.6.3 Electric heating
Storage units
Off peak systems
Cable heating systems
5.6.4 Local heating
Unit heaters (electric, gas etc)
Radiant heaters
Gas fires etc
5.6.5 Other heating systems
5.6.6 Heating with ventilation
(air treated locally)
Heat emission units
Distribution pipework
5.6.7 Heating with ventilation
(air treated centrally)
5.6.8 Heating with cooling (air
treated locally)
5.6.9 Heating with cooling

5.7 Ventilating
Area of
treated in m
Gross floor area in
Details of the
method and extent
of the systems
should be stated

Includes mechanical ventilation

installations not incorporating
heating or cooling systems

Cube of
5.6 m

Non-structural ducts
Isolated fans
Dust and fume extraction
Rotating ventilators

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples

Built in electrical heating systems

are NOT included in this element
but should be allowed for in
Space heating and air treatment
The number of
lighting points, the element.
number of power
In the breakdown the cost of
outlets and the
total electrical load standby equipment should be
given separately.
in Kw should be
stated separately.
This element should be broken
The cost of any
down into four sub-elements
special items
should be stated
5.8.1 Electric source and mains
and the
illumination levels 5.8.2 Electric power supplies
5.8.3 Electric lighting
5.8.4 Electric light fittings
according to the
principal functions
5.8 Electrical


Paper 1114 Page 27

Main items included in element

5.8.1 Electric source and mains
Distribution boards
Main switchgear
Main and sub-main cables
Control gear etc
5.8.2 Electric power supplies
The cost of supplies to different
types of installation should be
given separately
Cables, wiring and conduits from
local distribution boards
Outlet points
5.8.3 Electric lighting
Cables, wiring and conduits from
local distribution boards
Outlet points
5.8.4 Electric lighting fittings
Fittings including fixing
The cost of different types and
qualities should be given

5.9 Gas

When the gas service is primarily

for heating or hot water it should
be included with those elements

The number of
outlets should be
5.10 Lift and

In the breakdown the cost of each

type of installation should be given

The number of
rush period
passengers for
which the lifts
have been
designed should be

The costs of plant rooms and other

structural elements connected with
lifts and conveyor installations
should NOT be included in this
element but allocated to the
appropriate structural element.
This element should be broken
down into three sub-elements

The number,
capacity, speed,
number of stops,
number of doors
and height served
by lifts should be
The capacity of
joists should be
given in
The rise and travel
of escalators
should be stated.

5.10.1 Lifts and hoists

5.10.2 Escalators
5.10.3 Conveyors

Number Installation from and including

Distribution pipework to

5.10.1 Lifts and hoists

Lift cages
Hooks, ropes etc
Electrical work from and including
5.10.2 Escalators
5.10.3 Conveyors

Cost planning and pre-contract cost control

Element and
design criteria

General notes and examples


Electrical work to sprinklers is

NOT included in this element and
should be allowed for in Electric
power supplies sub-element. In
Area of
the breakdown the lightning
protection to boilers and vent
treated in m
Gross floor area in stacks should be given separately.
This element should be broken
=_____________ down into three sub-elements
5.11 Protective

Paper 1114 Page 28

Main items included in element

5.11.1 Sprinkler installation
Sprinkler installation
CO2 extinguisher systems
Control mechanism
5.11.2 Fire fighting installation
Hose reels
Asbestos blankets
Dry risers
Foam inlets
Fire extinguishers

5.11.1 Sprinkler installation

Number of
5.11.2 Fire fighting installation
sprinker outlets,
5.11.3 Lightning protection
the control
mechanism and the
area served by
each mechanism
should be stated.

5.11.3 Lightning protection

Conductor tapes
Burglar alarms
Fire alarms
Pneumatic tubes
Television and radio


5.13 Special

This element includes mechanical

and electrical installations which
do not fit into other elements.

5.14 Builders
work in
connection with

In the breakdown the total cost and

the cost per m of gross floor area
for service element 5.1 to 5.13
inclusive should be given

5.15 Builders
profit and
attendance on

In the breakdown the total cost and

the cost per m of gross floor area
for each service element 5.1 to
5.13 inclusive should be given

Installations for chemical gases

Window cleaning cradles etc
Garage equipment
Refrigerated stores

Cost planning and pre-contract cost control

Element and
design criteria
6.1 Site works

General notes and examples

This element should be broken
down into four elements

Site preparation
Surface treatment
Site enclosure and division
Fittings and furniture

be given
as a cost
per m
of gross

Paper 1114 Page 29

Main items included in element

6.1.1 Site preparation
Clearance and demolition
6.1.2 Surface treatment

Car parks
Playing fields
The unit Retaining walls
quantity Land drainage
for sub- Landscaping
6.1.1 is 6.1.3 Site enclosure and division
m. For
element Fencing
6.1.2 is Walls
m. For Hedges
subelement 6.1.4 Fittings and furniture
6.1.3 is
m. For
subFlag poles
element Seats
6.1.4 is
6.2 Drainage

Land drainage is NOT included in

this element but should be allowed
for in sub-element Surface
treatment (6.1.2)

Drainpipes to soil and surface
water drainage
Sewage treatment plants

6.3 External

This element includes the service

mains external to the building.

6.3.1 Water mains

6.3.2 Fire mains

This element should be broken

down into nine sub-elements as set
out in column four

6.3.3 Heating mains

6.3.4 Gas mains
6.3.5 Electric mains
6.3.6 Site lighting
6.3.7 Other mains and services
6.3.8 Builders work in
connection with external services
6.3.9 Builders profit and
attendance on external
mechanical and electrical

Cost planning and pre-contract cost control

Element and
design criteria
6.4 Minor
building work

General notes and examples

This element should be broken
down into two sub-elements
6.4.1 Ancillary buildings
6.4.2 Alterations to existing

. . . . . . . . % of
remainder of
contract sum (less

In the breakdown the individual

costs of the main preliminary
items should be given
Professional fees should not be
included here
Lump sum adjustments should be
spread throughout all elements
based on the total of each element
less PC and provisional sums
Where the analysis is for one
block of a larger contract the
Preliminaries should be allocated
in proportion to the cost of the

The unit
for subelement
6.4.1 is
the gross
area of

Paper 1114 Page 30

Main items included in element

6.4.1 Ancillary buildings
Isolated buildings
Bicycle stores
6.4.2 Alterations to existing
Minor additions
Contract and preliminary clause
Water for works etc.

Cost planning and pre-contract cost control

Paper 1114 Page 31

4 Comparison of analyses
Analyses vary considerably for similar types and sizes of buildings, and a careful
study is necessary before one is used for cost planning purposes. Table 2 shows
figures for two different analyses which could apply to office blocks built at the same
time in the same locality, with comments on why the two sets of figures vary. Figure
4 shows an example of amplified analysis.
TABLE 1 Information to be included in an amplified analysis
Type of building
Office block


Gross internal floor area

1 200 m

Date of tender
May 1986

Cost of element per m of

gross floor area in


Building A

Building B





Building A is on reasonably good

soil and has reinforced concrete
column bases and ground beams.





Building A has a reinforced

concrete frame and is partly
single and partly three-storey.
Building B is steel framed,
concrete cased and is mainly


Upper floors



Just under half of building A

floor area is on the ground floor
while only about 30% of
Building B floor area is on the
ground floor.





Building A has greater roof area

due to the greater percentage of
ground floor space. The roof
construction for Building A has a
covering of felt and Building B is
covered with Asphalt.





Wider staircases, more elaborate

balustrades and two extra storey
flights of stairs for Building B
(one flight each end between
third and fourth storey).


External walls



Building A is constructed with

cavity walls of brick and blocks
and medium priced facings.
Building B is of a more irregular
shape; the increased height also
increases the area of external
walling. The walls have
expensive bricks and stone ashlar
work. This element also includes
some aluminium curtain walling.



Cost planning and pre-contract cost control




Windows and
external doors

Element cost
Building A Building B




Paper 1114 Page 32


The windows in Building A are

mainly standard galvanised steel.
Building B has aluminium
windows some of which are
double glazed.
Building A has cheap doors and
frames while Building B has
hardwood frames and screens
with some hardwood and some
toughened glass doors.


Internal walls



In both cases most of the internal

divisions are non-load-bearing.
Only the main divisions are
provided in Building A and the
clients provide their own
partitions within the main office
Building B is for owner
occupation and all the partitions
are provided, some of which are
patent moveable type.


Internal doors



Only a few cheap doors in

Building A as most of the
partitions provided by the tenant.


Wall finishes



The walls in Building A are

mostly plastered.
Building B has some plaster but
panelling is provided in the
executive suite and marble and
mosaic in the entrance hall and on
the walls of the main staircase.
The toilets are partly tiled. Some
wallpaper allowed for.


Floor finishes



Mainly thermoplastic tiles in

Building A.
Building B includes a variety of
different finishes including
woodblock, mosaic, quarry tiles
and some vinyl tiles. The element
also includes extra thickness
screed and insulating material for
under-floor heating.



Cost planning and pre-contract cost control




Ceiling finishes

Element cost
Building A Building B




Paper 1114 Page 33


Building A has mainly plaster

direct on to the concrete structure.
Building B has patent suspended
ceilings mostly finished with
acoustic tiles.


Fittings and



Only essential fittings are

provided in Building A but in
Building B, which will be
owner occupied, most of the main
fittings are included in the
contract together with some





Building B has more and better

fittings as it is for the owneroccupier.














Heat source




Space heating
and air treatment












Gas installation





Building A has solid fuel hot

water heating and Building B has
underfloor electric heating.
(Note: the additional cost of
screed and insulation is included
in floor finishes)

Essential fittings only are

provided in Building A whereas
Building B has many elaborate
decorative fittings.

Cost planning and pre-contract cost control



Element cost
Building A Building B



Lift and
















Builders work
in connection
with services




Builders profit
and attendance
on services





Note: sub-total excluding

external works
preliminaries and

Paper 1114 Page 34


There is one extra storey in

Building B and the lifts provided
are faster and better equipped.

Special telephones are included

for Building B.

The contractor for Building A has

found that the PC sum used by
his architect in the bills of
quantities are generally high. He
has therefore priced the profit and
attendance low and increased his
rates on other work to allow for
this. The opposite is the case for
Building B.


Site works



Only the essential works were

included in Building A while
landscaping was provided for the
other building.





Increased sanitary fittings more

dispersed in B and a site which
results in deeper drains.





Building B is situated further

from the road than A.


Minor building



Building B has a bicycle shed,

substation and some garages.




Total (less contigencies)








You can see from the above example that indiscriminate use of figures taken from a cost
analysis can result in an incorrect cost plan being prepared.

Cost planning and pre-contract cost control

Paper 1114 Page 35

FIGURE 4 Example of amplified analysis

Element and design criteria

2.7 Internal walls and partitions



Cost of Element Element
cost of element
unit rate
element per m of quantity


7 259


218 m


Internal wall and partition area in m

Gross floor area in m

218 m
574 m
= 0.380
Preliminaries 7.52% of remainder of
contract sum


Half brick wall

75 mm expanded clay aggregate concrete
100 mm Ditto
50 50 mm and 75 75 mm stud partitions
Timber WC partitions

Half brick wall

75 mm blockwork
100 mm blockwork
Stud partitions
WC partitions

2.8 Internal doors

Preliminaries 7.52% of remainder of
contract sum

4 473


28 m

3.1 Wall finishes

Preliminaries 7.52% of remainder of
contract sum

6 496


666 m

2 226
3 290

Area All in unit

in m

159.75 35 mm flushed doors hardwood lipped and

plywood faced
45 mm Ditto
45 mm glased
Internal doors
Area All in unit
in m
No 4 35 mm doors
No 10 45 mm doors 2 289
No 4 45 mm
1 365
glazed doors

Two coats lightweight plaster

Plaster lath and two coats lightweight plaster
150 150 6 mm white glazed wall tiling
Wall finishes
Area All in unit
in m
Lightweight plaster
5 502 617
Plaster lath and plaster 350
Wall tiling

Cost planning and pre-contract cost control

Paper 1114 Page 36

5 Other sources of cost data

1 Cost limits and cost

Preliminary budgets and cost limit estimates.

2 Cost information published in Preliminary budgets, cost limit estimates, early

Price Books, approximate
preliminary estimates. Outline cost plan.
estimating section.
3 Cost information published in Cost plans, cost checks, final cost checks
the measured work section of
Price Books.*
4 Details of measured rates
published in professional and
trade journals.*

Cost plans, cost checks, final cost checks.

5 Cost analyses published in

trade journals.

Preliminary budgets, cost limit estimates, early

preliminary estimates and outline cost plans (in many
cases there is insufficient information to use for cost

6 Cost analyses published by

the RICS in the Building Cost
Information Service (BCIS)

All preliminary estimates and elemental cost plans and

parts of comparative cost plans.

7 Cost analyses prepared in the

quantity surveyors own office.

All preliminary estimates and elemental cost plans and

parts of comparative cost plans.
This source is generally more reliable than the sources in
(5) and (6) as the surveyor can use his own knowledge of
site conditions, economic climate etc of the analysed

8 Priced bills of quantities of

previous projects.

Cost plans, cost checks, final cost checks. The total

figures may be used for calculating preliminary estimates
but some adjustment for differences in size or standard of
building is usually necessary. Composite rates may be
built up from the bill rates which may also be used for
preliminary estimates.

9 Rates worked out during the

settlement of final accounts and
rates calculated from a
knowledge of builders material
costs and labour rates.

These can be used in a similar way to the priced bill of

quantities for building up composite rates and for
preparing cost plans and carrying out cost checks. A
record of agreed costs for unusual items may be of use
for future projects.

* Prices vary considerably between publication and you should use the figures only after careful study
and comparison with prices in bills of quantities for work in your area.

Cost planning and pre-contract cost control

Paper 1114 Page 37

5.1 Reliability of cost information

Students are often disconcerted to realise that the sources of information for cost
planning are all subject to variation. In the case of published data, for example:

Publishers of measured rates may be using average prices and the method used
to obtain the average may be statistically suspect.

Published rates may be recalculated at infrequent intervals and there may be no

indication of the last revision date. (This also applies to some trade

The items included in the elements may not be the same in each case, due to:

differences in the requirements of the publishers;

inefficiency or lack of knowledge on the part of the person analysing;

genuine mistakes, including printing errors.

Variations in cost data do not invalidate its use, but the user must be capable of
interpreting cost information in its context and adjusting it correctly in order to re-use
it. A few well chosen examples of data about which the surveyor has personal
knowledge of the circumstances surrounding the pricing of the jobs is often better
than indiscriminate use of averages based on sources whose backgrounds are little
A great deal of handling and systematic recording of cost data is required to enable
the quantity surveyor to know what are reliable figures. In order to derive reliable
cost information from as many sources as possible, standardisation of the elements
into which building costs are analysed is desirable. The RICS Building Cost
Information Service (BCIS) list of elements is now the most widely accepted.
Interpretation of cost data is partly a matter of opinion and not completely
mathematically accurate. The analytical approach to the detail does provide an
explanation for some variations and reduces to a minimum the chance and size of
differences that may appear to exist in the initial investigation of the cost data.
It has been suggested that bills of quantities should be divided in a different way from
the traditional trade sections. Some bills have been prepared in elemental form, others
in operational or locational form, but in practice the disadvantages of the increased
number of items and the difficulties involved in pricing have outweighed the
advantages claimed. With the use of computers it is possible to procure several
layouts for bills with very little extra effort, so that the ordinary trade bill can be
produced for tendering purposes. The computer can then be supplied with details of
pricing and a priced elemental bill can be produced for analysis purposes.

5.2 Information library

Many quantity surveyors offices have access to a library of cost information that

Normal trade literature and price lists, referenced using some systematic
scheme with an adequate index and cross-referencing system.

Analyses of all office tenders with priced bills of quantities and classified in
accordance with the CI/SfB code for building types.

Cost planning and pre-contract cost control

Paper 1114 Page 38

Because of the complexity of the building industry and the amount of literature
being produced, most architects and surveyors use the CI/SfB system which
provides for a large number of sections. Table O: Built environment gives
suitable classifications for buildings:
1. Civil Engineering Works
2. Transport, Industrial Buildings
3. Administrative, Commercial Buildings
4. Health and Welfare Buildings
5. Refreshment, Entertainment, Recreational Buildings
6. Religious Buildings
7. Educational, Cultural, Scientific Buildings
8. Residential Buildings
Only the main headings are given above. For further details you could refer to
the Construction Indexing Manual published by the RIBA.

Analyses published in professional and trade periodicals classified as


Cost indices from various published sources.

Special information on cost trends published in periodicals, together with

details of any facts likely to affect future costs.

Special details on planning and social factors published in periodicals (eg

Architects Journal) which are likely to affect the cost of buildings. These
can generally be classified under the CI/SfB headings.

Any special cost information collected for a particular project which

required original research in order to obtain the data.

Data contained in the literature sent out to subscribers to the Building Cost
Information Service of the RICS. Before submitting cost details, quantity
surveyors should get permission from the contractor, the building owner
and the architect. The information provided includes:

Cost indices and cost trend details.

Cost analyses in two forms:

i. a concise cost analysis with brief details;
ii. an amplified analysis giving sufficient details to make precise
adjustments to individual elements for differences. An
example of a page of an amplified analysis is given earlier in
this paper.

Publications digest.

Cost studies. These are articles on particular building problems

undertaken by the service or submitted by members or local study

Current prices and wages.

Cost planning and pre-contract cost control

Paper 1114 Page 39

6 Indices
Cost data is historical data. When we use this data to prepare an estimate or cost plan,
we need a means of updating it. Indices are a way of comparing changes in building
costs and tender prices over time.
A building cost index charts movements in the underlying costs of building by
tracking changes in the price of key inputs to the process, such as material costs,
labour costs and plant hire rates. Generally a standard mix of resources is used to
reflect the balance of costs of a typical project of a given type.
Building cost indices are compiled by official bodies using a model that takes data on
material prices supplied by the Department of Employment. Specialist organisations,
such as the National Association of Lift Manufacturers, also publish cost indices for
the more specialised aspects of construction for which a general building cost index
would be inappropriate. If the weighting of the model is incorrect, the index will be
A contractor is more likely to use this index when trying to predict future costs. By
looking at past trends, the possible future movement in costs can be assessed. The
structure of an input index model is shown in Figure 5.
A tender price index charts the movement of tender prices. It includes market factors
as well as the resource costs used in the building cost index. Tender price indices may
therefore be used to compare the costs of buildings for which tenders were obtained at
different dates, or to adjust analyses of past tenders to current prices. Future trends in
price levels may be forecast by a study of the indices, taking into account any current
wage price negotiations, any foreseeable changes in unemployment in the
construction or other industry, and other political and economic factors likely to react
on the building industry. It is therefore used in the cost planning process.
The BCIS provides a series of indices to subscribers giving details of changes in
various types of tenders. Indices are provided for four different classes of buildings
(eg load-bearing brick, steel-framed). Other indices assess the effect of changes in
market conditions (based on local authority housing) and the adjustment on tenders
for fluctuation risks.
FIGURE 5 Input index model

Cost planning and pre-contract cost control

Paper 1114 Page 40

A separate set of indices assesses changes in tender prices for different sections or
elements (services, external works etc) of the structure.
The BCIS also provides information on particular circumstances and local trends in
regions throughout the country.
Indices may be given in the form of a table. A particular year is given as a cost base
of 100. Any increase or decrease in cost is calculated as a percentage of the base year
and the percentage figure is added to or deducted from 100 (Figure 6).
FIGURE 6 Index in table form
Base year
First quarter
Second quarter
Third quarter
Fourth quarter









The same figures may be plotted on a graph, the years generally being plotted
horizontally and the index figures vertically (Figure 7).
FIGURE 7 Index in graph form

Indices may be used to bring a tender figure for a previous job up to current prices so
that it can be used for comparison or for cost planning purposes see Example 1.

Cost planning and pre-contract cost control

Paper 1114 Page 41

A firm price contract had a tender figure of 1,700,000. The general index for the date of
tender was 320. The estimate for which the figures are required is for a fixed price
contract. Market conditions in the two cases are assessed to be similar.
Calculate the revised current figure for original contract work.
The new contract will not have a fluctuations clause, so the general index, 335, may
need to be increased to cover the contract period say 340.
Adjustment to tender price 170,000

= 1,806,250

Updated price for original work = 1,806,250.

If general or local market conditions had been different, further adjustment would be
Remember that tender price indices only give an indication of the average trend of
building tenders. The skill of the quantity surveyor must be used to adjust indices to allow
for any special factors that affect the cost of the analysis or the cost plan project.


What is the most reliable source of cost information, and why?

Cost planning and pre-contract cost control

Paper 1114 Page 43

Part C: Preliminary estimates

1. Introduction
2. Methods of estimating
2.1 Unit method
2.2 Superficial method
2.3 Elemental method
2.4 Approximate quantities method
3. Pre-contract estimating
Self-Assessment Question

Cost planning and pre-contract cost control

Paper 1114 Page 45

1 Introduction
Preliminary estimates are prepared before the bill of quantities is available. Where no
bill is being prepared, they are the estimates arrived at before the contract or tender
figure is obtained.
Preliminary estimates are an attempt to forecast a reasonable cost for a project. They
are prepared so that the client is aware of his commitments as near the inception of
the project as possible. They also enable the architect to decide whether his design is
a reasonable one having regard to the amount of money available.
Remember that the degree of accuracy of the estimate will reflect the extent of the
information available. Nevertheless, estimates should be calculated as accurately as
the information available and the skill of the surveyor will allow. Do not over-inflate
estimates, as the clients decision whether to carry on with or abandon the project
may depend on the estimated figure. A low first estimate (perhaps due to lack of
information) is also undesirable, as it is likely that the figure the client remembers
best will be the one he hears first.
When preparing the estimate, the following should be included:

All the items normally forming part of the tender figure.

Brief details of the specification on which the estimate is based.

Mention of any special items that are excluded (shop fitting, special joinery
fittings, demolition etc). Failure to inform an architect or client of items
excluded may at best cause problems later, and at worst give rise to allegations
of professional negligence.

The date of the estimate.

The drawings from which the estimate is prepared.

The assumed tender date, so that confusion will not arise if several revisions
are made.

The amount allowed for price fluctuations between the estimate and tender
date should be clearly indicated.

Surveyors should not be influenced by what the architect or the client thinks the job
should cost. The quantity surveyor is the building cost expert, and he should base his
figures on the information he is given about the project and on his experience of past
jobs. The estimate given to a client or architect should only be amended with good
reason and not just to please the architect. If the original estimate figure was right,
within reasonable limits, then any alteration is likely to cause friction later.

Cost planning and pre-contract cost control

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2 Methods of estimating
The main methods used for estimating are:



Elemental (this is really only an extension of the superficial method)

Approximate quantities.

Single rate methods

2.1 Unit method

The quantity surveyor may use the unit method of estimating at the early brief stage
of a project, when the client may have only an idea of the number of items or people
he wishes to accommodate in the proposed building and wishes to know the likely
cost before proceeding further. At this stage it is assumed that no drawings have been
prepared and there is only a general idea of the quality required.
Examples might be:

A project such as a new multi-storey car park. If the quantity surveyor knows
from published data or (preferably) from previous experience that the cost of
providing space for one car varies from 3000 to 3500, he can work out an
approximate figure by multiplying, say, 3250 by the number of cars. At this
early stage it may be better to give a range of costs from 3150 to 3450
with an idea of the quality likely to be obtained at different points within the

Hostels cost per bed.

Schools cost per student place.

Theatres cost per seat.

Because of the wide range of costs per unit and the small number of units to be
multiplied, this method of estimating requires a lot of skill to obtain an accurate
figure. It is easy to calculate once the unit cost has been decided, but it is not a very
reliable method for accurate estimating and should only be used in the early stages of
a project or where budgets are being prepared by an organisation to calculate future

2.2 Superficial method

This is the most popular method of estimating during the early stages of a project
once the general outline drawings have been prepared.
Because the floor area is less than the volume of a building, any small error in
arriving at a price rate will have less effect on the total estimate. However, the storey
heights will have an effect on the cost, so height must be taken into account when
deciding the price rate. As far as possible the price rate used should be based on data
taken from similar building projects with similar storey heights.
The superficial area of the building should be measured between the inside faces of
external walls with no deductions for partitions, stairwells, lifts etc. Where a building
consists of parts which are of a different construction, or where the standard of finish
is widely different, each part should be measured separately so that different price
rates can be used.

Cost planning and pre-contract cost control

Paper 1114 Page 47

External works and abnormal items (eg piling) are normally allowed for separately as
lump sums which are added to the normal superficial price calculation.
External works are generally priced by measuring approximate quantities, as
explained in a later section.
Specialist lump sums may be arrived at from quotations or estimates obtained from
specialists as in the case of piling, or they may be based on information obtained from
previous projects.
The superficial method is sufficiently accurate at this stage, as most of the items are
related more to floor area than to volume. The floor area is easy for most clients to
understand, and in many cases the architects brief will tell him that certain
equipment is to be installed which will require a given floor space. The use of this
method is therefore a help to both the client and the architect during the design
The area for this method is relatively easy to calculate, but it does require skill in
assessing a price rate. Particular care is necessary when comparing similar types of
building with widely differing storey heights.
This method has two main disadvantages: it does not directly take account of
changes either in shape or in the overall height of the building.
In Figure 8, Buildings P and Q have the same superficial plan area, but, due to the
extra external walling (shown by a double line) and the increased difficulty in setting
out, it is likely that building P will be more expensive than building Q. Several other
items are likely to be affected by the cost, some of which (eg span of roof) may offset
some of the extras.
Where buildings are of similar areas but varying total heights, the additional cost of
hoisting men and materials should be considered when comparing their superficial
price rates.

Cost planning and pre-contract cost control

Paper 1114 Page 48

The plans following represent the external walls of an old persons home for which an
estimate is required. From similar projects, it has been calculated that the price per square
metre to be used in the estimate is 500. Calculate the cost using the superficial method.

Area of ground floor inside walls:

40.00 10.00
10.00 14.00
12.00 10.00
Area of ground floor
Area of first floor
40.00 10.00
10.00 14.00
7.00 10.00


= 400.00
= 140.00
Area of first floor
Total area

660.00 m

610.00 m
1 270.00 m

Estimated cost of building is 1 270.00 m 500.00 = 635 000.

As with the previous method a separate item should be included to allow for increases
after the date of the estimate.

Cost planning and pre-contract cost control

Paper 1114 Page 49

2.3 Elemental method

This form of estimating is used as the basis of elemental cost planning (see Part D)
before any drawn information is available. It can be used to calculate a reasonable
sum to be spent on a project, and on the various parts of the project, without relation
to a particular design. The total cost is obtained in a similar way to the superficial
method, but greater skill is necessary to obtain a reasonable breakdown of the total
cost into parts.
The basis of the elemental method lies in the use of elemental cost analyses, as
described in Part B.

When a preliminary estimate is required, the analyses of previous jobs should

be studied carefully and one or two chosen which most closely represent the
new project.

The costs shown in the chosen analyses are then adjusted to form the basis of a
new cost plan.

The requirements of the new project are carefully compared with those of the
analyses. Any variations due to changes in quantity or quality are carefully
priced and a list of the major components (elements) together with the adjusted
costs is made and totalled. This will include allowances for preliminaries and

To this total must be added a sum to allow for price changes which it is
anticipated will occur between the date of preparing the estimate and the date
on which tenders are received.

The costs shown on the analyses are then adjusted to take into account any
changes in the price of materials or labour, or any changes in economic
conditions, up to the date at which the estimate is being produced. This
adjustment is usually made by means of a building price index, which may
consist of a graph or a table of figures and represents general price variations
compared with a given base year. The complete process is shown in
Example 3.

Once the initial cost plan has been prepared, it can be used as a cost control
tool during the design development phase. As more information becomes
available, elemental unit quantities and elemental unit costs may be substituted
for the elemental costs per square metre.

Later, the developing design for each element is costed using the approximate
quantities techniques (see 2.4 below) and the costs generated are incorporated
into the elemental cost plan. This forms a continuously updated cost model of
the developing design.

Cost planning and pre-contract cost control

Paper 1114 Page 50

EXAMPLE 3 Initial cost plan

An estimate is required for a factory of 6000 m. The most suitable analysis available is
the one set out below. The new factory is to be similar in shape and specification to that in
the analysis but is to be 1.00 m higher (the original factory was 4.50 m high to eaves). The
analysis building had no office and little toilet accommodation as this was a separate
block carried out under another contract.
The new factory is to have 100 m of ancillary and office accommodation within the main
factory structural shell. A sprinkler system for which an estimate of 50,000 has been
obtained from a specialist is to be included in the new factory. The building cost index for
February 2000 is 270 and at the date of the preparation of the estimate the index figure is
300. The factory is expected to go out to tender twelve months after the preparation of the
Single storey factory:
Total floor area:
Type of contract:

7500 m
Open firm price tenders, JCT 98 with quantities
February 2000
February 2000
February 2001
1 917 350
30 000

Tender date:
Work began:
Work finished:
Contract sum:
Cost analysis
Based on tender. (Preliminaries shown separately.)

Note: The specification notes and quantity factors have been omitted from this example
for simplicity, though they are essential in practice for calculation purposes.

1.0 Substructure
2.0 Superstructure
2.1 Frame
2.2 Upper floor
2.3 Roof
2.4 Stairs
2.5 External walls
2.6 Windows and external doors
2.7 Internal walls and partitions
2.8 Internal doors
Group element total
3.0 Internal finishes
3.1 Wall finishes
3.2 Floor finishes
3.3 Ceiling finishes
Group element total
4.0 Fittings and furnishings

Cost per m Cost per m of gross

of gross floor floor area (Group
element totals)



Cost planning and pre-contract cost control

5.0 Services
5.1 Sanitary appliances
5.2 Services equipment
5.3 Disposal installations
5.4 Water installations
5.5 Heat source
5.6 Space heating and air treatment
5.7 Ventilating system
5.8 Electrical installations
5.9 Gas installations
5.10 Lift and conveyor installations
5.11 Protective installations
5.12 Communication installations
5.13 Special installations
5.14 Builders work in connection with services
5.15 Builders profit and attendance on services
Group element total
Subtotal excluding external works, preliminaries
and contingencies
6.0 External works
6.1 Site works
6.2 Drainage
6.3 External services
6.4 Minor building works
Group element total
Total (less contingencies)

Paper 1114 Page 51




The plan shape of the analysis building is approximately rectangular 100 m 75 m. To

prepare the estimate the analysis figures are first brought up to date by using the price
The analysis figures are multiplied by


existing indices )

Revised analysis figures adjusted to date of estimate


= 31.83
1.0 Substructure
2.0 Superstructure
= 115.05
3.0 Internal finishes
= 20.00
4.0 Fittings and furnishings

5.0 Services
= 61.39
6.0 External works
= 33.67
= 14.67
276.61 (excluding contingencies)
Note: all the elements would normally be used and adjusted and not just the group

Cost planning and pre-contract cost control

Paper 1114 Page 52

Estimate for new factory

Cost per

1.0 Substructure
Slight increase due to smaller building resulting in greater perimeter
per m of floor. Increase due to larger bases for higher building but
partly offset by shorter spans. Increase due to additional foundations
for office partitions. Soil assumed similar to that on analysis site.


2.0 Superstructure
Increase in frame and walls due to height. Slight increase in walls due
to greater perimeter per m of floor. Increase in partitions and doors
due to offices.
3.0 Internal finishes
Additional and more expensive finishes to offices


4.0 Fittings and furnishings

Some fittings in offices


5.0 Services
Additional fittings and supplies for toilets etc. Some increase in heating
due to increased factory height and higher temperatures required in
offices. Sprinkler system and builders work etc to be included.


Total per m of floor area (excluding external works, preliminaries and



6.0 External works

The figure for this will depend on the site and cannot be estimated from
other projects. Assume the total cost calculated by approximate
quantities is 80 000.


Additional storage sheds may be required, contract period likely to be
similar due to work in office area increase cost per m slightly as total
area is less.
No additional problems expected.
Estimated cost of building 6000 272.20
Estimated cost of external works



Design risk to allow for slight variations in

design say 2%
Price forecast risk for increases in labour and material
between date of estimate and date of tender, say 20%
on estimate.
(To obtain this percentage a study of price changes in
recent years is necessary, also careful inspection of
trade journals to see what future increases have been
Estimated tender figure

1 633 200
80 000
96 000
24 000
1 833 200
45 830

366 640

2 245 670
2 250 000

Cost planning and pre-contract cost control

Paper 1114 Page 53

2.4 Approximate quantities method

This is the method which is still most favoured by quantity surveyors, as it uses ideas
common to those used in preparing a bill of quantities. It is the most reliable of all
forms of preliminary estimating and should always be used when cost checking
during the detail design stage.
Example 4 shows the use of approximate quantities in a simple building.
Composite price rates are obtained by combining the major bill of quantities items
which have similar areas or lengths. An upper floor price rate might include:

ceiling finish and decoration below

floor construction
floor screed and floor finish
percentage addition to cover other smaller items, eg skirting.

Depending upon the type of building and the purpose of the estimate, the degree of
accuracy required and the method of measurement will vary. For example, windows
may be measured and priced as extra over the cost of the wall in early estimates, but
may be later measured in greater detail as more information becomes available.
Elemental unit rates obtained from analyses may be used to prepare approximate
quantity estimates in some cases.
The approximate quantities method is a more accurate estimating method, but it does
require more detailed information than the superficial method. Depending upon the
experience of the surveyor, measurement can be carried out fairly rapidly but more
calculations are needed than in any of the other methods. Initially the composite
pricing rates will require care and take time to build up. However, surveyors who use
these prices at frequent intervals will have all the basic data and generally need only
to make small updating adjustments each time. Complete recalculations will be
necessary only at fairly rare intervals.
All the data available (eg floor areas) with other types of estimating methods can
easily be obtained when this method is used.
For this form of estimating special paper is printed with dimension columns on the
left and the usual bill pricing columns on the right.
EXAMPLE 4 Lodge to factory
Using approximate quantities, work out the estimate for the building shown in the
drawings. The building is a lodge to a large factory and is to be constructed at the same
time as the main building. No external works are to be included in the estimate.
Note: The rates used in this example are not necessarily current rates applying in any
particular district. You should check on the rates for items obtained in current bills of
quantities or price books.

Cost planning and pre-contract cost control

EXAMPLE 4 Lodge to factory

Paper 1114 Page 54

Cost planning and pre-contract cost control

Lodge to factory

Paper 1114 Page 55

Estimate for lodge to factory

Drawing No ......................

Date ...............

Ref Dimensions Extension

Quantity Rate



Exc o/site lay 150 mm hardcore, 150

mm bed of concrete 20 screed and
vinyl tiles
Build up
1 m oversite
1 m hardcore
1 m concrete
1 m dpm
1 m screed
1 m vinyl tiles

15 m

25.65 384.75

17 m

37.10 630.70


(Note: a new build-up will not be

necessary for every estimate.)
Sundry labours
sktgs etc 15%
Cost per m

4/270 mm




Exc tr av 600 mm wide and 600 mm

deep lay 200 thick concrete,
building 270 brick cavity wall total
450 high with fcgs (200 per
thousand) 300 high xtly
Build up
0.36 m excavation
Removal or backfilling
0.12 m concrete
0.70 m 270 brickwork
0.30 m facings (eo)
2.00 m 110 dpc

Sundry labours
levelling, p & s etc




Cost planning and pre-contract cost control

2.60 44.20 270 Brick cavity wall faced externally
(200.00 per thousand) and plaster and
emulsion internally.
Build up
1 m 110 wall in commons
1 m 110 wall in facings
1 m cavity
1 m plaster
1 m emulsion
Sundry labours 2%
Cost per m

Paper 1114 Page 56



44 m

40.08 1763.52


Extra over last for metal window size 1800

m 1.300 m including glass painting etc

3 No 137.55 412.65

Build up

1 No window
2 m glass
4 m painting
1.8 m concrete sill
1.8 m quarry tile sill
4.4 m plaster and emulsion to reveal
2.4 m facing to reveal and closing
2 m lintel and cavity gutter
Sundry labours arrises ends etc 2%
Cost per window
Less 2 m cavity wall
Extra over cost of wall



Cost planning and pre-contract cost control

Paper 1114 Page 57



Extra over cavity wall for single external

softwood two panel door with one panel
filled with Georgian wired class, 100 45
frame, painting etc
Build up
1 No door 0.5 m glass
3.4 m painting
1 pr butts
1 No lock
5.0 m frame
10.0 Ptg fr (both sides)
5.0 m plaster and emulsion reveal
4.0 m facing and closing cavity
1.0 lintel, cavity gutter
0.8 Soldier arch
1.0 arch bar
Sundry labours, arrises cramps,
dowels 5%
Less 2 m cavity wall
Extra over cost of door

1 No 102.96




24.00 Roof 3 m span of timber joists, firrings,

wood wool slabs, felt, plasterboard and
emulsion to soffit.
Build up
2.5 m 150 50 joist
& firrings
1 m 50 wood wool
1 m felt
1 m plasterboard
1 m emulsion
Sundry items 5%
Cost per m

24 m

42.80 1027.20



Cost planning and pre-contract cost control

Paper 1114 Page 58



20.00 20.00 Fascia, gutter etc (eg curb) including outlets

Build up
1 m fascia
1 m painting
1 m plastic gutter or roll
0.2 m plastic pipe

20 m




(Note: the sides without gutter are

assumed similar in cost to that with.)
Sundries, angles, fittings etc 10%
Cost per m

Sink with water supply and waste

Build up
1 No sink
1 No bib valve
1 No stop valve
1.5 m 15 mm cold tubing
1 No trap
1.5 m 40 m waste

1 No 120.04



Sundry labours, painting holes, pipe

fittings 10%
Cost per sink

Build up
2 No lighting pts
2 No power pts
1 No water heater



Profit and attendance builders work







Estimate for building




External works including water main, electric supply, paving drainage etc measured
Note: No allowance is made in this estimate for price variation between date of estimate and
date of tender.
Estimated cost per m

= 356.67

Cost planning and pre-contract cost control

Paper 1114 Page 59

3 Pre-contract estimating
The unit and superficial methods of estimating are known as single rate methods
because, with a few exceptions (eg specialist works), only one price rate is used in the
calculations. With these methods it is difficult to relate changes in construction or
changes in specification directly to price rate changes.
Buildings are subject to the principle of disproportionate change. If the linear
dimensions of a cube (eg height and length of the external walls) are doubled, the
enclosing surface is increased fourfold and the volume eightfold. Building costs do
not vary commensurately with any of these changes, so the value of expressing costs
in terms of any of these units is limited.
The unit method is really only suitable for budget purposes.
In practical terms, the square metre superficial method is the best of the single price
methods, as it is quick, can be used as a basis for a future cost plan, and is most
closely related to user floor space requirements.
It has been suggested that the elemental method has the advantage over
approximate quantities in that cost data can be obtained from a much wider field
there is a lot of published information and the cost of elements in one building (eg the
frame of an office building) may be compared with those of another type (eg the
frame of a block of flats). Unfortunately, many factors affect the pricing of bills of
quantities. A comparison of elements in different analyses shows that there is often a
difference in elemental rates which is due far more to varying characteristics in
pricing between firms than to changes in design or specification. A very careful study
of the figures is necessary, and many of the published analyses do not give sufficient
information to make a detailed study possible. Where details are given, it may take
more time to make adjustments between the analysis and the details of the proposed
building for which the estimate is being prepared than to measure approximate
As you become aware of the factors affecting the cost of various elements, your
facility for comparison will improve; but skill will always be required to make price
adjustments when preparing an elemental estimate.
All forms of estimating require considerable skill. Applying results from previous
jobs without due discrimination can be very dangerous. The ideal system would
provide a method of compiling reliable estimates quickly so that accurate advice
could be given on the general economics of a scheme.
The use of the terms approximate and rough when used to describe estimates are
rather misleading. Remember the client is likely to retain the first figure he is given,
so this should be as accurate as skill and the information available will allow.
When would it be more appropriate to use the approximate estimate method instead of the
elemental method when preparing an early estimate?

Cost planning and pre-contract cost control

Paper 1114 Page 61

Part D: Detailed cost planning

1. Introduction
1.1 Aims of cost planning
1.2 Types of cost planning
1.3 General advantages and disadvantages of cost planning compared with
earlier methods
1.4 Comparison of elemental and comparative cost planning
2. Elemental cost planning
2.1 Preparation of an elemental cost plan
2.2 Use of the cost plan
2.3 The tender stage
3. Comparative cost planning
3.1 Preparation of a comparative cost plan for individual buildings
4. Cost planning in use
Self-Assessment Question

Cost planning and pre-contract cost control

Paper 1114 Page 63

1 Introduction
Cost planning is a method of providing cost data that will help the architect in making
design decisions. The system used should provide the information in a form which is
easily understood by all the design team architect, consulting engineers, quantity
surveyors and contractors and also by the client.
In the past there has been a gap in cost information between the time of the
preliminary estimate and the receipt of the tenders. It was in an attempt to bridge this
gap that cost planning was developed.
Most clients, if not all, have a cost limit for the work they require. This limit may be
fixed by:

the amount of money available;

the revenue or selling price expected;
the upper limit fixed by a government department;
comparison with other similar buildings.

The client may inform the architect of his requirements and the design team then
estimates the cost of a suitable design which meets the clients needs. This then
becomes the cost limit.
The cost limit must be a realistic figure for the work proposed, otherwise cost
planning cannot be properly carried out. The architect must also be determined to
produce a design within the cost limit, which means that restraint will be necessary in
some cases.
If you have not read Parts A, B and C of the paper, go back and read them now,
as they will help you understand the cost information used to prepare your cost

1.1 Aims of cost planning

The aims of cost planning must be:
1. To ensure that the sum of money the client sets out to spend on the project is
not exceeded. In theory, the tender figure should equal the first estimate, plus
or minus any agreed differences, but in practice the vagaries of the marketplace mean that this ideal is not always achieved. In truth, the cost plan
prediction is usually taken to be a fair price for the work, whereas the lowest
tender figure will be distorted by the pricing policies of the tendering
contractors and the state of the construction market at the time of tender. The
client should be made aware of any financial differences as soon as any design
changes are made.
Controls and checks must be carried out at intervals throughout the design and
construction periods to make sure the target is being kept.
2. To ensure the client obtains good value for money. The building design must
be economical, which means that the architect should provide the standard of
amenity, finish and equipment stipulated by the client at the least cost
consistent with good design. The client does not have to spend the whole
amount he can afford if a suitable standard can be achieved for less.

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The money spent on a project should be rationally distributed so that large sums of
money are not spent on one part of a building to the detriment of other essential parts.
For example, normally it would be wrong to spend large sums on floor finishes if
insufficient money was left to provide a watertight roof covering.
The information provided in the cost plan must be in a form which:

is easily understood by all parties;

facilitates comparison between different buildings;
is related to the design process.

For these reasons the idea of design elements was developed.

An element is defined as:
A major component common to most buildings which usually fulfils the same
function irrespective of its design, specification or construction.
The elements must be described in such a way that the client can understand what is
meant. The elements used in this paper are those defined by BCIS.
A common yardstick must be used to compare the costs of different schemes. A
perfect yardstick, which would change exactly proportionately with changes in cost,
does not exist, and the most reliable one must be chosen.
Costs per place or per person are sometimes used for administrative control, but they
do not readily allow comparison between buildings of different types and are not
suitable for detailed cost planning.
The best yardstick so far developed for comparing building costs is the superficial
floor area unit in square metres. This is useful both for architectural design and for
client requirements. The same unit has been used for elemental cost planning, but it
has many disadvantages, including the fact that most members of the design team do
not think of cost in relation to the floor area when they are designing most of the
building elements. Unfortunately no better unit of comparison has yet been suggested.
Though in some forms of cost plan the items are expressed as costs per square metre
of floor area, initially they may be calculated using other units. For example, heating
and ventilating is often more related to volume than to superficial floor area; sanitary
fittings are often easier to calculate as all-in cost per fitting than to relate the item to
the superficial floor area.

1.2 Types of cost planning

There are two main forms of cost planning, though in practice the method used may
be a mixture of the two:
1. An elemental cost plan states the architects design intentions in sums of
money. This is the design budget. The architect can then proceed to develop
his design as he wishes within what he believes to be the correct economic
framework. The main problem is to decide what is the correct economic
framework. Throughout the design period the quantity surveyor should check
the cost of the architects selection against the pre-determined budget.

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2. A comparative cost plan sets out the estimated costs of individual sections of
work and, where appropriate, the estimated costs of alternative methods and
materials that the architect may wish to consider. The architect selects the most
suitable details with complete awareness of the cost consequences of his
This type of cost plan is therefore a concise statement of the cost consequences
of any decisions the architect may make and is based on the pricing of a
specific design and specification.

1.3 General advantages and disadvantages of cost planning

compared with earlier methods

1. The preliminary estimate is likely to be more reliable because of the cost

checks made in the early stages of design.
2. Because of the cost checking, there is less likelihood of amendment to the bills
of quantities being necessary. This saves the time which is wasted by the
quantity surveyor and contractor agreeing the amendments and by the architect
redrawing detailed drawings.
3. The design is likely to be more economic because detailed costs are studied at
an early stage and the random cutting out of items after tenders are received
should not be necessary.
4. Owing to the division of the cost of the project into sections or elements, a
rational distribution of expenditure throughout the design ought to be achieved.
Unfortunately, building types and situations differ so much that it is generally
very difficult to decide what is a reasonable cost for any particular element.
5. The quantity surveyor and the architect become familiar with each others
ideas at an early stage in the project. Closer alliance between the members of
the design team will help their understanding of each others difficulties.
6. If the same quantity surveying staff are used to prepare the cost plan and to
take off the bill of quantities, the preparation of the bill should be simpler. The
quantity surveyor will have a considerable understanding of the project before
taking off is commenced.
7. There will be a better chance of comparing different projects.
8. Owing to the increased pre-tender planning, the working details are likely to be
available sooner and the contractors site planning should be easier.

1. More preparation is necessary in the early stages of design.

2. The architect is likely to be more restricted in his method of working.
3. The quantity surveyor requires a considerable knowledge of costs and pricing
and of the design factors that affect cost.
4. Both the architect and the quantity surveyor are likely to be involved in more
work at the design stage than when cost planning is not used.

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1.4 Comparison of elemental and comparative cost planning

Elemental cost planning
Comparative cost planning
1. It may involve the architect in more 1. It is likely to take more of the
redrawing at the detail stage if his
quantity surveyors time because
solutions do not fit in with the cost
several alternative schemes may
need to be priced.
2. The architect will require a skill and
ability and some knowledge of
costs to keep his design details
within the cost plan framework.

2. The architect will need to make

design decisions early in the design

3. The use of the square metre of floor

area as a yardstick provides a
means of comparing different

3. The pricing of alternative solutions

to any design problem will show
the cost consequences of any choice
and is likely to isolate the most
economic solution to the problem.
The early study of relative costs
will help the architect decide the
basic lines of design.

All forms of cost planning require three processes to be carried out:

1. Deciding how much to spend. Where elemental cost planning is used, this
will be the target cost that should be decided during the brief stage. Where
comparative cost planning is used, some idea of the figure may be suggested in
the earliest stage but the actual decision is not made until the design stage
when the cost plan has been drawn up.
2. Deciding how to spend the money. This is the preparation of the cost plan
3. Confirming that the expenditure does follow the cost plan. This is carried
out by cost checking during the detail design stage. Further checks on the
expenditure will be made during the later stages of the project, but these should
be more in the way of cost control than part of cost planning.
For any form of cost planning to be useful:

The surveyor and architect must be sufficiently skilful.

Both they and the client must want to make the procedure work.

Estimates must be reasonably accurate.

In the case of elemental cost planning, the cost target must be a practical one.

Estimates of the relative costs of alternatives prepared for the comparative cost
plan must also be accurate. If they are not, and all the items incorrectly priced
low are chosen by the architect, the cost plan may be difficult to keep to.

The architect must be prepared to make decisions which he intends to keep.

The architect must prepare drawings in such a way that cost checking can be
carried out.

Where element cost targets are exceeded, the architect and the quantity
surveyor should make every effort to make adjustments, either in the same
element or in other elements, so that the total target cost is not exceeded
unless the client specifically agrees to an increased expenditure because of
changes in user requirements.

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Preliminary estimating and cost planning are to some degree an art not merely a
slavish calculation and application of principles learnt from textbooks. A quantity
surveyor must get the feel of the job: he must not lose sight of the fact that it is the
final cost which is of interest to the client, not the details it has been necessary for
him to study.
Not all things are calculable during the early stages. For some items a guess based on
experience and intuition may be necessary. If the wrong percentage is added at the
end for preliminaries and insurances, the total may be completely inaccurate even if
the detailed calculations for a large part of the work are accurate. With comparative
cost planning a great many detailed calculations are required, and small errors may
result in a structure or plan layout that would not have been chosen if the calculations
had been correct. If decisions are made early in the scheme they are difficult to
change at a later date.

2 Elemental cost planning

Elemental cost planning is based on the assumption that:

it is possible to establish a realistic estimate of the project at or before the early

sketch plan stage;

both architect and quantity surveyor are willing to be bound (with certain
reservations) by the early estimate.

Elemental cost planning should provide a means of controlling costs so that they are
kept within the estimated figure. The process may show that the preliminary estimate
or budget figure is seriously wrong, in which case it will be necessary to refer to the
client for his decision.
One of the merits of cost planning is that it should avoid the difficulties and
complications that arise when tenders exceed estimates.

2.1 Preparation of an elemental cost plan

It is assumed that a cost limit or target for the project has already been agreed during
the brief stage. The quantity surveyor should have provided an initial cost plan at the
beginning of the design stage which can be discussed, amended and finalised during
the scheme or sketch design stage. This has been discussed in Part C above, section
The following items are generally required for the preparation of a detailed cost plan:

Copies of the sketch plans and elevations.

A brief specification of the method of construction.

A note of the proposed standard of finishes, fittings, services etc, probable type
of contract, estimated tender date, length of contract, and cost target.

A suitable cost analysis.

Other suitable analyses for checking purposes.

The procedure is as follows.

The total floor area inside internal surfaces of external walls is calculated from the
plans. Plans may not be available in the early stages, but the architect may provide a
figure from the clients brief.

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The total target cost is then divided by the total floor area. This will provide a target
cost per square metre of floor area.
From this figure a deduction is made to act as a reserve for small details that may be
overlooked when cost checks are made later. This deduction is called the reserve for
design risks. The amount allowed will vary, depending upon the architects and
quantity surveyors experience of cost planning, the amount of confidence they have
in themselves and each other, the state of the design, and its complexity. It is usually
between 2 and 10 percent of the target figure.
Also deducted from the target cost figure is a price forecast risk. This is included
to allow for rises in the prices of materials, wages etc that are expected to occur
between the time the cost plan is prepared and the date of the tender. The amount will
depend upon the quantity surveyors assessment of price trends. It is likely to vary
significantly according to the economic situation and the expected period between the
preparation of the cost plan and the tender date.
At the time the initial cost plan is prepared, there is probably insufficient detail to
prepare any approximate quantities, so information contained in analyses of other
jobs must be the main source of information. It is generally better to choose a job the
quantity surveyor is familiar with rather than a published one of which he has no
personal experience. Where possible, the analysis chosen should be of a similar type
of building, of similar size, shape and height, and with a similar specification. The
quantity surveyor and the architect might visit buildings with the most likely
Using analyses

Choosing a suitable analysis is often difficult. It is unwise to use two analyses at the
same time for preparing the same cost plan. Different contractors price their bills in
different ways, so to use substructure from one analysis and internal finishes from
another may result in considerable errors. In some cases information can only be
obtained from an analysis which is not being used for the main part of the cost plan
(eg special equipment), but this procedure should be used with care.
Many quantity surveying practices use computer software packages or
spreadsheets for preparing cost plans. An appropriate analysis to adapt is chosen, and
a source of current cost information identified for items that do not appear in the
analysis. Adjustments are made for:

Time using tender price indices: multiply by index for proposed project
divided by index for analysis.

Location using regional indices: as above.

Quantity using elemental quantities: measured from drawings.

Quality by assessment.

Each element unit rate, or the rate/m gross internal floor area, is adjusted as required,
with notes as to why the adjustments have been made.
If you are using a spreadsheet in your assignment work, the format for presenting the
information could be as shown in Figure 9. Supporting calculations showing how the
quantities are obtained or rates built up will also be required.

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FIGURE 9 Abstract from a cost plan


Adjustment for time


Adjustment for location










Existing analysis is similar
Could perhaps adjust for lighter

Historical data = 27.57/m







Frame, not applicable
Upper floors
Taken as per original data
Flat, but different construction
Spons price book for composite
Structure, ref:
Finish, ref:
Perimeter details (say) 10/m
note no uplift to cost is required
Flight taken to mean rise from one
floor level to the next. Taken to be as
External walls
Cavity walling ( net area )
130/1000 in data = 42.80/m
New bricks 250/1000,
increase of 120/1000
60 bricks/m = 16.67m,
120/16.67 = 7.20/m
Windows and External Doors
Area total for both (30% of wall)
Internal walls and partitions
Measure new quantities and price as
original where specification is the
One brick walls = 525m
half brick walls = 300m
demountable partitions = 450m
(current rate)
Internal doors
Taken as cost /m gifa

































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The element quantity used may not necessarily be the actual quantity but the gross
internal floor area. For example, the lighting will service the whole of the building
and therefore the gross internal floor area is an appropriate quantity to use against this
portion of the services element. In the abstract in Figure 9 you will see that the same
principle has been adopted for the internal doors, as we do not know at this stage
precisely how many doors are required. When drawings showing this detail are
received, the cost plan will be adjusted.
The analyses rates of most elements have been updated to current prices. However,
the roof is of an entirely different construction. Local current prices have been used,
so no adjustment for time or location has been made.
Adjustments for quantity and quality have to be made in three ways:
1. by proportion;
2. by approximate quantities, as explained previously;
3. by inspection.
In some cases a combination of these methods may be used.
The analysis chosen is first adjusted for price changes. This may be done by
reference to cost indices which will give a general picture but may be adjusted for
market conditions, type of contract, and the special local considerations applying both
to the original analyses and to the new project. The quantity surveyor must have a
wide knowledge of the factors which affect building prices in order to make an
accurate assessment of the price adjustment necessary. The revised analysis elemental
costs may be inserted against a copy of the analysis summary.
Filling in the main details

The next stage in the preparation of the cost plan is to set out the main details. For
this a duplicated form may be an advantage: it can be used in conjunction with a form
containing a standard list of elements.
The main details will include:
1. Reference number of the job together with a CI/SfB reference.
2. Name and address of project, and site conditions where known.
3. Type of building with a brief description.
4. Date of estimate.
5. Type of contract it is proposed to use, and the period of construction.
6. Proposed tender date.
7. Cost limit or target cost (based on a preliminary estimate).
8. Total floor area, number of storeys and storey height where known.
9. Target cost per square metre of floor area.
Any quantities which are available are entered against the various elements in the
standard list. In the early stages when the outline cost plan is being prepared, the
quantity factors may be rather vague. Assumptions may have to be made, and their
accuracy will depend on the skill of the surveyor.
Where the quality in the analysis is the same as in the cost plan, adjustment of figures
for different quantity factors is relatively simple for some of the elements.

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Adjusting by proportion, inspection and approximate quantities

Where there is a change in quality, an estimated percentage may be added to or

deducted from the elemental target cost, after adjusting for quantity, to allow for the
difference in specification. Where the percentage is difficult to assess, approximate
quantities for the element in question may be measured and priced out to arrive at the
total elemental cost, from which the elemental cost per m is easily obtained. In a few
cases there may be some advantage in referring to other analyses for the cost of an
element, particularly if special considerations are to be taken into account.
The substructure, drainage, and external works elements are difficult to adjust by
proportion. Where sufficient detail is available, approximate quantities are the most
reliable method of estimating the cost of these elements. The total cost is estimated
first and then divided by the floor area to obtain the elemental cost.
Where sufficient details are not available, the figure may be arrived at by inspection.
The accuracy of this method depends much more on the skill and intuition of the
quantity surveyor.
The elemental cost for the frame is normally arrived at by inspection at the early
stages, though specialist estimates should be obtained to confirm the figure as soon as
The upper floors, roof, external walls, windows and external doors, internal
walls and partitions, internal doors and finishes can all be adjusted for quantity by
the proportion method., If the specification varies, however, the additional adjustment
may be made by inspection, or in some cases both the quantity and quality may be
adjusted by approximate quantities.
Fittings and furnishings may be estimated by inspection, approximate quantities, or
by the use of a specialist estimate.
In a few cases the elemental cost for sanitary appliances, disposal and water
installations may be worked out using a proportion method based on the number of
fittings, but it is not very reliable and careful inspection is generally necessary.
Heat source and space heating are sometimes calculated by the proportion method
using the calculated heat losses or cubic capacity of the building as a quantity factor.
However, as the heat source cost does not vary directly with the increased output, this
method is not always satisfactory. Moreover, in the early stages of the project the heat
losses are not generally known. Inspection or a specialist estimate are the methods
generally used. Approximate quantities are used occasionally.
Similar difficulties arise with ventilating systems and this element is generally
tackled in the same way as the heating.
Electrical installation cost may be calculated by any of the methods. The one used
will depend on the similarity of the buildings and the amount of information
Lifts, protective installations, communication installations and special
installations are all specialist items. The best method is to obtain the total cost from a
consultant or a specialist firm and convert it to elemental costs per m. Take care to
include everything when specialist estimates are given. The quantity surveyor should
note that in some analyses, eg BCIS, builders work and profit are given separately.

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The quality adjustment is not an attempt to price a definite specification but only to
value a certain standard. If an analysis shows an elemental cost of 44.00 per m of
floor area for a block floor and skirting, and the architect approves this as the general
standard of floor finishes required, then 44.00 per m may be included in the cost
plan (assuming that adjustment for price changes have been made on the analysis).
The fact that 44.00 has been included in the plan does not commit the architect to
using hardwood flooring; he may choose any floor covering in the range of up to, say,
32.00 a square metre the remainder of the element cost being for screeds and
skirtings etc.
The task of estimating the cost of his choice occurs at the cost checking stage.
An analysis (after adjusting price by index numbers) contains the following information:
Internal doors element
Flush doors semi-solid core 1445 m
Hardwood doors 237m
Number of single doors 751
Number of double doors 22 = (44 leaves)

23.04 per m of floor area

All-in unit rate 80.00 per m
All-in unit rate 240.00 per m

Total floor area 7486 m

The cost plan drawings show a total floor area of 6700 m but all the doors are flush type.
There are 620 single and 5 double doors. Calculate the internal door elemental cost for use
in the cost plan.
The area of the doors in the cost plan is not fixed at this stage but we can assume the sizes
are similar to those in the analysis.
Total door area in analysis
Total number of doors in analysis

1445 + 237 = 1682 m

751 + 44 = 795

Average area per door


Total door area for cost plan

(620 +10)

Total cost of doors for cost plan

1682 630

Cost per m of floor area

= 15.92

Elemental cost for use in cost plan =


This figure might be increased slightly to allow for the fact that there is a smaller
percentage of double doors in the cost plan.

Preliminaries and contingencies are both arrived at by inspection.

Preliminaries are usually calculated as a percentage of the total of the remainder of
the work. The percentage is usually arrived at from inspection of the analysis being
used, from the surveyors knowledge of previous projects, and from the project which
is being cost planned. Some of the items which might considerably affect the
percentage allowed for preliminaries are:
1. Access to the site, including roads available on the site.
2. Facilities for storing materials on site and space for temporary offices etc.
3. Fencing required to provide adequate safety for public and prevent pilfering.

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4. Period of contract, and whether travelling or subsistence allowances are likely

to be excessive.
5. Service facilities for carrying out the work (eg temporary plumbing).
6. Whether a clerk of works is to be resident on the site.
7. Method of pricing used in the bill of quantities from which the analysis was
obtained. Some firms allow for all or part of their profit and overhead items in
the pricing of the preliminaries section.
8. Type of contract (eg whether a firm price or with fluctuations).
The percentage of the work allowed for preliminaries varies from about 2.0 percent
up to 20.0 percent. Considerable error can occur if the allowance for this item in the
cost plan is not calculated carefully.
Contingencies are often decided in a purely arbitrary way, but the figure chosen
should represent the chances of unforeseen work occurring which will involve extra
Finalising the cost plan

When all the target elemental costs have been obtained, including those for
preliminaries and contingencies, they are entered on to a cost plan summary,
including the reserves for design risk and price forecast risk, and totalled up.
It is unlikely that the total will exactly equal the total target cost obtained by dividing
the cost limit by the floor area. The difference between the two figures must be
obtained. After carefully checking all the figures and discussing the plan with the
architect, possible changes in quality or quantity may be agreed and the elements
adjusted accordingly to arrive at the agreed total target cost.
It is assumed that the original target cost was realistic, that the client wishes to keep
to the figure, and the architect intends to try and produce a design within the estimate.
In some cases the client may ask for additional items and agree to the target figure
being increased to allow for them.
The initial cost plan must be as accurate as possible, but with the slender information
likely to be available at the end of the brief stage it must be a flexible document.
During the scheme design stage, the architect can provide further drawings from
which more accurate quantity factors and a more detailed specification may be
obtained. During this stage the plan is revised in accordance with the drawings, using
approximate quantities to arrive at the cost figures where necessary.
The revised elemental cost targets will be set out on a draft cost plan which, after
discussion with the architect, will be formulated into a final cost plan at the end of
the scheme design stage.
Though the document is described as the final cost plan it is still a flexible document.
It is the quantity surveyors attempt to translate the architects wishes into sums of
money and to confirm that his wishes are capable of fulfilment. It does not say that a
special specification is going to be used in the project, but is a general guide of the
standard of building aimed at.
The cost plan might be entered up on sheets similar to those shown in Figure 10. In
some cases the initial and final cost plans might be included on the same sheet by
repeating the last three columns. The list of elements can be printed on the sheets
provided sufficient space is allowed for brief details to be noted.

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FIGURE 10 Example of a cost plan


An item for price

and design risk
should be followed
by the list of
elements in the same
same order as for

Brief details
of elements

Details of the
standard used
to arrive at the
cost should be
given here



cost of

The total cost of an element may be

calculated first and the elemental target cost
calculated from this or vice versa.

2.2 Use of the cost plan

Once the architect has been provided with a final cost plan, he can see which
elements are the most important in terms of cost and, by further discussion with the
quantity surveyor, how reliable each elemental cost may be. For example, if no trial
holes have been dug it may not be certain whether piling will be necessary, but this
may be allowed for if there is a reasonable chance that it will be needed.
The architect and quantity surveyor should agree the order of preparation of detail
drawings. Drawings of elements with high unreliable costs are placed early in the list
where practical, to enable other element costs to be adjusted if necessary. The detail
design drawings should solve all the problems of how the building is to be erected.
They may only be tracing paper sketches, but they should nevertheless be so
informative that preparing final working drawings at a later stage is simply a question
of copying.
As soon as detail design drawings for an element are prepared, they are passed to the
quantity surveyor who will check the cost against the figure included in the final cost
plan. Checking is usually carried out by measuring approximate quantities and pricing
at rates for current work with the necessary adjustments. The building up of cost
checks is best set out in sections (eg each floor finish separately with a summary and
total) so that modifications are easily adjusted.
When consultants are employed, their designs must be checked against the target cost
allowed for their element, and any quotations must be checked with the sum allowed
in the plan.
As the quantity surveyor checks the drawings etc for each element, he should
immediately inform the architect of the result and whether the elemental cost target is
likely to be achieved. If any action is necessary (eg the element is not on target), the
quantity surveyor should suggest whether modification is likely to be necessary and
how it might be carried out. It is for the architect, in conjunction with the remainder
of the design team, to decide what modification he will make, but by keeping
continuous contact with the quantity surveyor he will be aware of all the cost
implications of his design decisions.
Example 6 shows how suggestions for savings might be calculated if the design
submitted is likely to exceed the target cost.

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A tenstorey concrete-framed office block has been designed with storey heights of 3.30m.
In estimating the cost it is clear that the target figure is likely to be considerably exceeded.
A member of the design team has suggested that each storey height be reduced by
Explain how this variation is likely to affect the various elemental costs.
The substructure may be reduced, as the wall and partition loadings will be about
9 percent less, which may affect the stanchion base and wall foundation sizes. The saving
on this element will not, however, be very great as most of the items will be unaffected.
The frame cost will be reduced, because there will be a reduction of about 9 percent in
column height and therefore concrete, reinforcement and formwork for this part of the
element will all be less. The actual size of the columns and beams may also be slightly
smaller, due to the reduced wall and partition loading. As the column part of this element
in this type of building is likely to be between a quarter and a half of the total cost of the
frame element, the saving is likely to be about 3 percent of the total frame cost.
The upper floor element may have small reductions due to less partition loading, but
these are likely to be minimal. The roof is unlikely to be affected.
The staircase element might be reduced by about 7 or 8 percent, as there will be fewer
treads, less balustrade, formwork etc. Some items such as bends in handrails are unlikely
to be affected.
How far external walls and window elements will be adjusted will depend on how much
the reduction in storey height affects the walls and how much the window area.
The internal walls and partitions elements will generally be reduced by slightly more
than 10 percent, as the door voids in the lower part of the partitions will not be affected. If
the reduction in height is taken up in part or whole by service voids above a suspended
ceiling, then the percentage reduction is likely to be less, as some partitions may not
extend into this void. If some partitions (eg WC partitions) are less than storey height, this
will also reduce the percentage reduction. Similar factors will have to be considered when
calculating the reduction in the wall finishes element.
Space heating, ventilation systems (where they exist) and heat source elements should
also cost less, but not as much as the volume reduction of 10 percent as there are unlikely
to be major changes in pipe work and valves.
There may be minor savings in some other elements.
When checking each element, the quantity surveyor must be certain that all items have
been included (eg profit and attendance has been added to specialist quotations where
required). Where drawings for only part of an element have been prepared, the quantity
surveyor may still cost out the items on the drawing and then make a reasonable
allowance for other things in the element. If it is obvious that the target cost is going to be
exceeded, the architect should be informed immediately.
In all cases the estimated total cost should be given to the architect so that he can compare
it with the cost plan and not just the part of the elemental cost which has been accurately
A record should be kept showing the elements checked, the result of the check, the
drawings used, the date when the information was sent to the architect, and any
suggestions made to the architect. If at a later date modifications in the element are made
by the architect, the effect on cost and the date should be included in the record.

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At intervals during the detail design period the design team should have meetings to
discuss the cost position so that all members are kept informed and any necessary
modifications made.
When all the detail design drawings are complete and all the elements have been checked
individually, the quantity surveyor should collect all the information together and make a
final cost check of all the elements to ensure that alterations in one element have not
affected cost in another. At the final check, the reserve for price and design risks may also
be adjusted for any changes in conditions (eg proposed wage increases).
If the team has worked together properly, the figure obtained for total cost at the end of
the final check should be within the original cost target, subject to any adjustments agreed
to or requested by the client.
At times during the project, particularly during the design stages, the quantity surveyor
may be asked to prepare comparative costs for two methods of carrying out the same part
of the construction. These costs are normally calculated using approximate quantities and
are called cost studies or preliminary cost investigations. Though the figures so calculated
may be used later in the process of cost checking, the cost studies themselves do not
directly form part of the elemental cost planning procedure but are merely one of the ways
in which members of the design team can assist one another.

2.3 The tender stage

Once tenders are received, the final stage of elemental cost planning can take place.
The priced bill of quantities submitted by the successful tenderer should be analysed
as described in the earlier papers, and the analysis compared with the cost plan.
If there is a substantial difference between the tender and the cost target, a
comparison of the analysis with the cost plan will show immediately where the
discrepancies are and pinpoint those elements where reductions, if necessary, should
be sought.
Though the tender stage is really the last phase of cost planning, it is sometimes
advisable to compare the final account with the cost plan. The process may be rather
laborious, as it is often difficult to allocate variation costs to the correct elements, but
it may indicate cases of abnormally high or low sums or measurements in the original
bill of quantities which materially affect the elemental costs.

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3 Comparative cost planning

Comparative cost planning aims to:

settle systematically whether one alternative is cheaper than another at a stage

when it is most useful;

present to the architect in a well-ordered manner all the information relating to

cost that he requires to make an economic design decision.

Comparative cost planning may be used for:


Comparisons with two or more complete buildings likely to arise in the case
of residential buildings, where several alternatives may appear equally suitable
from the planning aspect. Something more than a general opinion may be
required. Here the quantity surveyor may need to measure some approximate
quantities and price some of the details. Floor areas and the cost per m may
need to be calculated and submitted to the architect, together with the main
items of cost difference.

Single buildings where a comparison only of small sections is needed. In the

early stages of a project the architect may require comparisons for the costing
of non-framed, reinforced-concrete-framed and steel-framed structures, or the
effect on cost of various column and beam spacings and floor thicknesses.

Calculating whether the cost of providing the same area of floor space in a
single-storey or multi-storey building is likely to be most economical. The
quantity surveyor will need to make fairly detailed estimates to arrive at the
initial cost differences.

Example 7 indicates that generalisations on costs are not good enough for guiding
design conditions. Though in general two storeys are less expensive than three
storeys, this is not always the case. In the example, the designs prepared, together
with poor site conditions, have resulted in high foundation and roof costs for the twostorey block which reversed the normal cost relationship of two-storey buildings.
An architect is faced with the problem of incorporating in a housing scheme either:
1. 20 four-bedroom three-storey houses as Type A, or
2. 20 four-bedroom two-storey terrace houses as Type B, of virtually the same gross
floor area but providing increased habitable area.
Prepare preliminary estimates and details for submission to the architect to show a
comparison between the two schemes. (For the purposes of this example it is assumed that
an outline specification is available and used for calculating costs.)

Cost planning and pre-contract cost control

EXAMPLE 7 Type A three-storey dwellings

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Cost planning and pre-contract cost control

EXAMPLE 7 Type B two-storey dwellings

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EXAMPLE 7 (Continued)
1 Schedule of accommodation
Area classification
Habitable floor area
Circulation and service areas
Total gross floor area
Exposed areas (those exposed
above or at side eg terraces)

Type A

Type B




Type B 1.5 m greater than A

Type B 1.9 m less than A



Type B 14.9 m greater than A

2 Costs
Estimated cost of Type A 32,700 which equals 327.98 per m of gross floor area
Estimated cost of Type B 35,600 which equals 358.51 per m of gross floor area
(Note: These figures are based on approximate quantities and exclude external works.)
3 Schedule of major cost variations of Type B over Type A


Type B Type B
extras reduction


Increased length of foundations and

larger ground slab.

ii Walls, facings, partitions,

windows etc


Increased area of structural walls

iii Upper floors and stairs


Reduction in number of storeys

iv Roof


Addition of paved timber roof





Net additional cost of Type B over Type A

= 4000 1100 = 2900 per house
Total extra cost of scheme if Type B houses are used will be 2900 20 = 58,000.
4 Additional notes

Type B provides 1.5 m of extra habitable area per dwelling.

ii Type B occupies greater site area per dwelling.

iii Type B has a greater area of facings per dwelling and any increase in price of facings
will result in a greater difference between the two schemes.

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3.1 Preparation of a comparative cost plan for individual

As in the case of elemental cost planning, it is assumed that costs have been discussed
and perhaps a cost limit or target for the project agreed during the brief stage.
During the sketch or scheme design stage, the quantity surveyor will prepare the cost
With most projects the aim is not necessarily cheapness but the provision of a certain
standard economically. At any stage during the design of a building an architect will
have a range of alternative solutions each of which may satisfy the standard required
by the client. In the early stages of design the choice is very wide. If the most
economical scheme is to be prepared, all the alternatives should be studied to see the
effects on costs. In some cases not only the initial costs but also the user costs may be
If the quantity surveyor can provide the architect and other members of the design
team with the cost consequences of alternatives early in the design procedure, then
the architect may select the optimum lines along which to develop his design.
Obviously, to price all alternatives would be a lengthy operation, but the alternatives
most acceptable to the architect should be priced.
Comparative cost plans are prepared in two steps during the scheme design stage.
1. Comparison of alternatives based on initial scheme design drawings.
Preparation of an initial cost plan.
2. Completion of the scheme design. Preparation of the final cost plan.
1 Initial cost plan

Items required for preparation of the initial cost plan are:

1. Copies of the sketch plans and elevations.
2. Brief details of the parts of the construction for which no alternatives are
3. Brief details of the alternative forms of construction the architect considers
worth investigating.
4. Details of finishes, services and fittings, including any alternatives to be
5. Note of the probable type of contract, estimated tender date, length of contract
and cost target.
6. Cost analyses and priced bills of quantities of similar jobs for comparison.
The first step in the preparation of the cost plan is the pricing of the alternative
solutions to the design problems which the architect has suggested or the quantity
surveyor thinks are worth considering.
Where the building is one that can be easily divided into similar bays or units, it is
sometimes advantageous to price one bay or unit and then multiply by the number of
units to obtain the total costs for comparison. At this stage very slight differences
between bays or units will probably make little difference to the result.
Next the building works are divided up into sections. For convenience of reference
with other projects, these may be the same as the element headings used in elemental
cost planning, but this is not necessarily so, and, in view of the methods used for
pricing, may initially result in items being included in sections where they are not
normally placed in the cost plan.

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Sections for which comparisons are to be made should be divided into subsections.
How many will depend on how many parts of the section are to have alternatives
The initial cost plan might be set out in eight columns (Figure 11):

First column section number.

Second column section name.
Third column subsection name.
Fourth column description of various alternatives.
Fifth, sixth and seventh columns pricing.
Eighth column remarks.

The first four columns are completed and the price of any sections or subsections for
which there are no alternatives are calculated, either using approximate quantities or
basing the estimate on previous jobs. Prices for these items are then inserted into the
second and third pricing columns.
FIGURE 11 Part of an initial cost plan

Name of

Name of





and stud










Less likely
to be

75 mm
both sides


with 75 mm
thick studs
& plasterboard and
plaster both


57 mm






Easiest for
and takes
up least


* Item chosen by architect

The sections or subsections for which there are alternatives have the prices for each of
the alternatives set out in the first pricing column against the brief description. The
lowest of each set of alternatives is also put in the second pricing column.
The details of the price build-up are usually set out on separate sheets so that they can
be referred to or adjustments made to all relevant elements when the final cost plan is
prepared. The detail sheets might be shown as in Figure 12.

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FIGURE 12 Price build-up of Item 2.7B

Internal partitions: Area 80m
Price per
m ()

estimate ()

75 mm lightweight

concrete blocks
Two coat plaster 5.00 2 10.00
Sundry labours 7%



3.5 m 75 50 studding @
Plaster and plasterboard
6.00 2
Labours 6%



57 mm partition and fixing 16.80

Timber fixing fillets
Labours 4%





a. 75 mm lightweight
concrete blocks and
two coats of lightweight
plaster each side
b. Stud partition of 75
50 studs at 400 centres
covered both sides with
plasterboard and
finished with one coat
of plaster

c. 57 mm proprietary
hollow cored plasterboard partition
finished for decoration

When all sections and subsections have been priced, the second pricing column is
added up.
Allowances are then made for preliminary items, contingencies, and price and design
risk (similar to those included in elemental cost planning). The figures for these
allowances are inserted in the second and third pricing columns. The final total of the
second column will give the estimated cost of the project if the cheapest alternatives
are used.
In some cases alternatives may affect the prices of sections other than those in which
the item is included. However, provided the cost figure is correct, the section in
which the money is included is relatively unimportant at this stage.
When this procedure has been completed, the initial cost plan is sent to the architect.
After carefully considering all the facts, he will choose from the various alternatives
and insert the estimated costs of his choices in the third pricing column, which can
then be totalled.
When looking at the alternatives, the architect should consider not only initial cost but
also performance of the material, aesthetics, user costs etc. The quantity surveyor
may help in the choice by adding comments and user cost figures in the remarks
column of the cost plan before sending it to the architect. When the architect makes
his choice, he may include in the remarks column his reasons for choosing the
particular item.
The design team can then compare the total of the third pricing column with any
target cost agreed at the brief stage. If there is a discrepancy between the figures, the
architect may reconsider his choices or consult with the client as to whether to work
to a new target cost.
2 Final cost plan

The architect then proceeds to the second step in the scheme design stage: the
preparation of further scheme design drawings incorporating the decisions made in
the initial cost plan. When these are completed, the quantity surveyor prepares a final
cost plan which takes into account all the chosen alternatives and sets out the costs of
each section and subsection.

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The figures for each section inserted in the final plan will differ slightly from the
earlier one, as the items in the sections will generally be made to agree with the
elemental analysis items.
The architect then proceeds to the detail design stage and prepares the detail design
drawings in accordance with decisions made at the earlier stage. During this period
the quantity surveyor may be asked to make some further comparative cost studies
and may compare the specification notes made by the architect or his assistant with
the information contained in the cost plan. There should be no need for a detailed cost
check of each drawing during this period as the main details of the design have
already been settled and the cost estimated during the preparation of the cost plan.
The cost plan should not, however, be regarded as an inflexible document. The
architect must be in a position to change some of the details or materials if he wishes,
provided the overall cost picture remains unaltered or the additional (or reduced) cost
is agreed by the client.
At the end of the detail design stage, a final cost check should be made to ensure that
there have been no major variations in design that would affect the cost.
The remaining stages in the design procedure up to tender stage are the same as for
elemental cost planning. The test of cost accuracy is the tender. When the tenders are
received, the bills of quantities should be analysed and compared with the cost plan.
Even if the tender figure is the same as the target cost, the information gained by
analysis is useful for future schemes for which the architect requires similar cost

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4 Cost planning in use

Though elemental cost planning has been in use for a number of years, it has not
proved very successful in some of its objectives. The way in which buildings are
designed does not readily allow for piecemeal checking of elements during the design

Factors such as the whim of the architect and variations in estimating practice
of contractors are difficult to allow for when arriving at target rates for the
various elements. This is particularly difficult if a cost plan is being prepared
using published data, as the characteristics of the architect and the contractor
are not known to the quantity surveyor.

If the cost plan is being prepared using analyses of recent projects carried out
in the quantity surveyors office and the architect responsible for the proposed
work is well known to the quantity surveyor, then more reliable estimates of
elemental costs are likely.

It is also difficult to predict future price changes and in many cases these
changes depend upon an irrational political decision made somewhere in the

Costs expressed per m of floor area are not helpful to the design team when
making decisions on the quality of materials for most of the elements. Unit
quantity prices (eg cost per m of window) are generally more useful and likely
to be more readily understood by architects and other members of the design

The decline in the number of bills of quantities being produced and therefore
analysed may lead to a lack of suitable analyses to use when cost planning.
The sample database will undoubtedly shrink over the next decade.

Briefly explain the three main processes that are carried out during cost planning.

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Sample cost analyses

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1. Purpose of pre-contract cost control:

To keep within the clients budget.

To ensure a balanced expenditure on the various elements of the project.

To meet the clients requirements and provide value for money.

2. Source of reliable cost information:


A surveyors own records, as he knows how the information was collected

and factors such as local market conditions, contract particulars and site
problems that may have influenced the costing.

3. When would it be appropriate to use approximate estimating to prepare an early


Where no similar analysis is available, or, if one were used, considerable

adjustments would be required. If changes from an analysis are significant,
it may prove quicker to measure approximate quantities and to price them
with composite rates.

4. The three main processes carried out during cost planning are:

Deciding how much to spend.

Deciding how to allocate costs to elements.

Continually checking that costs do not exceed the plan as the design