Professional Documents
Culture Documents
0 INTRODUCTION
Cost estimation is a vital process in project management and financial planning. It involves the
systematic assessment and prediction of the anticipated costs associated with a particular
project or endeavor. Cost estimation plays a crucial role in decision-making, allowing
stakeholders to evaluate the financial feasibility of a project, allocate resources effectively, and
develop realistic budgets.
The purpose of cost estimation is to provide an accurate projection of the financial investment
required to successfully complete a project. It involves the identification and evaluation of
various cost elements, including labor, materials, equipment, subcontracting, permits, and other
relevant expenses. By considering these factors and analyzing historical data, industry
benchmarks, and expert insights, cost estimators can develop reliable estimates that help
stakeholders make informed decisions.
However, it is important to acknowledge that cost estimation is not an exact science. It relies
on assumptions, data availability, market conditions, and the accuracy of inputs. Therefore,
estimators must carefully consider potential risks, uncertainties, and variations that could
impact costs. As a project progresses, cost estimations may need to be revised and adjusted to
reflect changing circumstances, such as scope changes, unforeseen challenges, or market
fluctuations.
In summary, cost estimation is a critical process that enables effective financial planning,
budgeting, and decision-making in project management. It provides stakeholders with valuable
insights into the anticipated costs of a project, facilitating the allocation of resources,
identification of risks, and evaluation of project feasibility. By conducting thorough research,
utilizing relevant data, and accounting for potential uncertainties, accurate cost estimations
contribute to the successful execution of projects.
2.0 PLANT & MACHINARY
In the context of construction works, "plant and machinery" refers to the various types of
equipment, tools, and vehicles used to carry out construction activities and facilitate the
construction process. They are essential assets that enable construction companies to execute
projects efficiently and effectively. Plant and machinery encompass a wide range of equipment
specifically designed for construction purposes, including but not limited to the following:
1. Excavators: Heavy machinery used for digging, excavating, and moving large
quantities of earth or other materials on construction sites.
2. Bulldozers: Powerful machines equipped with a large metal plate (blade) on the front
for pushing soil, rubble, or other materials during grading, leveling, or clearing
operations.
3. Cranes: Towering machines used for lifting and moving heavy objects, such as steel
beams, concrete blocks, and construction materials, to desired heights.
4. Concrete Mixers: Equipment used to mix cement, sand, aggregates, and water to
produce concrete on-site, ensuring a consistent mixture for various construction
applications.
5. Loaders: Machinery equipped with a scoop-like bucket on the front, used to load and
transport materials, such as soil, gravel, or debris, onto trucks or into other construction
equipment.
6. Pavers: Machines used for laying and leveling asphalt or concrete surfaces during road
construction, pavement projects, or other construction activities.
7. Compactors: Equipment used to compress and compact soil, asphalt, or other materials,
ensuring a stable and solid base for construction foundations or road surfaces.
8. Scaffolding: Temporary structures made of metal or other materials, providing
platforms and support for workers to access higher areas of construction sites safely.
9. Concrete Pumps: Specialized machinery used to transfer liquid concrete from the
mixing site to the desired location, ensuring efficient and accurate placement.
10. Generators: Portable power sources that provide electricity for construction sites,
enabling the operation of various tools, lighting, and other equipment.
These are just a few examples of the diverse range of plants and machinery used in construction
works. Each type of equipment serves a specific purpose and contributes to the successful
execution of construction projects, improving efficiency, productivity, and safety on-site.
2.1 Detail Plant & Machinery for Earthworks
The plant and machinery that are been used for earthworks are as follows:
Cost and specification stated in Table 1 is based on 1 unit of each of the machinery. All the
activity is planned to use different number of the machinery based on the critical activity and
the quantity of each activity. The summary of the machinery for every activity are as follows:
Taking off quantity, also known as material takeoff or quantity surveying, refers to the process
of estimating and determining the quantities of materials required for a construction project. It
involves analyzing construction drawings, specifications, and other project documents to
identify and quantify various components and elements needed for the project.
The process of taking off quantity typically involves the following steps:
Taking off quantity is an essential process in construction cost estimation, project planning,
and procurement of materials. It helps contractors and project stakeholders determine the
quantities and costs of materials, prepare accurate bids and estimates, and effectively manage
the procurement and delivery of materials throughout the construction project.
3.1 Detail of Quantity Taking Off
QUANTITY TAKING OFF SHEET
DESCRIPTION UNIT
2
Clear the site of all trees (irrespective of girth) undergrowth creeper, lallang, shrubs, m
bushes, rubbish, debris and any other obstruction including grubbing up roots and
stumps and cart away from site to Contractor's own dump. QUANTITY
269,763.69
TAKER OFF
Symon
SQUARRING
CHK. SQUARRING
DESCRIPTION UNIT
Excavate top soil average 150mm deep, load and transport to temporary filling area. m2
QUANTITY
269,763.69
TAKER OFF
Symon
SQUARRING
CHK. SQUARRING
Figure 1 shows an example of grid method calculations for cut and fill volume based on zone
B area. In the quantity taking off sheet we use grid B-C/1-2 as an example in this project reports.
PROJECT BILL NO. ELEMENT / TRADE SLIP NO.
PROPOSED DEVELOPMENT OF ZONE B 3.0 3
1MALAYSIA (PRIMA) HOUSING IN MUKIM
HULU LEPAR, DAERAH KUANTAN,
PAHANG DARUL MAKMUR.
HEADING
Cut and Fill
DESCRIPTION UNIT
Excavation of earth materials to make up levels to the final requisite formation level m3
as shown on the Engineer's drawings.
QUANTITY
461,266.22
TAKER OFF
Symon
SQUARRING
CHK. SQUARRING
DESCRIPTION UNIT
Fill and spread selected excavated materials to make up levels to the final requisite m3
formation level as shown on the Engineer's drawings in layers and graded each
layer compacted. QUANTITY
474,613.12
TAKER OFF
Symon
SQUARRING
CHK. SQUARRING
DESCRIPTION UNIT
Imported earth from contractor's own source within 10km from site including m3
unloading in filling areas.
QUANTITY
13,346.90
DESCRIPTION UNIT
Allow for slope protection by using spot turfing and making good every works, m2
defects as specified and leave everything in perfect working order to the entire
satisfaction of the Superintending Officer. QUANTITY
24,721.45
TAKER OFF
Symon
SQUARRING
CHK. SQUARRING
1 24,721.45
24,721.45 Total area based on Civil 3D software
4.0 BUILT UP RATE
A build-up rate, also known as a composite rate or unit rate, is a calculation that combines
various components of cost to determine the total cost for a particular item or activity in a
construction project. It is commonly used in estimating, cost planning, and pricing purposes.
Build-up rates are typically expressed as a cost per unit of measurement, such as cost per square
meter, cost per cubic meter, or cost per unit.
To create a build-up rate, you need to consider the individual elements that contribute to the
total cost of the item or activity. These elements may include:
1. Labor costs: Estimate the labor hours required to complete the task and multiply it by
the labor rate or wage rate, including any applicable taxes, benefits, or overheads.
2. Material costs: Determine the quantity of materials needed and multiply it by the unit
cost of each material, including any markups or delivery charges.
3. Equipment costs: If equipment is required for the task, calculate the cost of equipment
usage based on factors such as equipment rental rates, fuel consumption, and
maintenance costs.
4. Subcontractor costs: If certain aspects of the work are subcontracted, estimate the
subcontractor's fees and any associated costs.
5. Overhead and profit: Consider any overhead expenses, such as general administrative
costs, insurance, and project-specific overheads. Add a suitable profit margin to cover
business profits and risks.
6. Other costs: Include any additional costs specific to the item or activity, such as permits,
testing, site preparation, or disposal fees.
It's important to note that build-up rates may vary depending on project-specific factors, such
as project location, complexity, scale, and market conditions. Therefore, it is crucial to update
and validate build-up rates regularly to ensure accuracy and reflect current market conditions.
4.1 Details of Build-Up Rate
Machinery cost
Rental per month including mobilizing to site RM 15,000.00 /month
Rental for 1 unit bulldozer (D6R Track-Type Tractor) of capacity 3.93m3 = RM 500.00 / day
(including payment for driver/operator and fuel) = RM 500.00 / 8hr
Total rental per hour = RM 62.50 /hr
Cost / m3 = RM 0.11
Machinery cost
Rental for ½m³ excavator including diesel and mobilization
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
Cost / m3 = RM 0.49
=
Cost / m2 (for 150mm depth) = RM 0.07
Machinery cost
To use 10 tonne lorry
Lorry Cost
Transporting cost
Rental/hr = RM 600.00 /8hr
= RM 75.00 /hr
Running cost
Lubricator (1.0 liter/7 days) x RM 25.00 = RM 3.57 /8hr
Running cost/hr = RM 0.45 /hr
Total rental per hour = RM 75.45 /hr
Cost / m3 = RM 3.72
Machinery cost
Rental per month including mobilizing to site RM 15,000.00 /month
Rental for 1 unit bulldozer (D6R Track-Type Tractor) of capacity 3.93m3 = RM 500.00 / day
(including payment for driver/operator and fuel) = RM 500.00 / 8hr
Total rental per hour = RM 62.50 /hr
Cost / m3 = RM 0.11
Machinery cost
Rental for ½m³ excavator including mobilizing to site
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
Machinery cost
To use 10 tonne lorry
Lorry Cost
Transporting cost
Rental/8hr = RM 600.00 /8hr
= RM 75.00 /hr
Running cost
Lubricator (1.0 liter/7 days) x RM 25.00 = RM 3.57 /8hr
Running cost/hr = RM 0.45 /hr
Total rental per hour = RM 75.45 /hr
Machinery cost
Rental per month including mobilizing to site RM 15,000.00 /month
Rental for 1 unit bulldozer (D6R Track-Type Tractor) of capacity 3.93m3 = RM 500.00 / day
(including payment for driver/operator and fuel) = RM 500.00 / 8hr
Total rental per hour = RM 62.50 /hr
Cost / m3 = RM 0.11
Machinery cost
Rental for ½m³ excavator including mobilizing to site
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
Machinery cost
To use 10 tonne lorry
Lorry Cost
Transporting cost
Rental/8hr = RM 600.00 /8hr
= RM 75.00 /hr
Running cost
Lubricator (1.0 liter/7 days) x RM 25.00 = RM 3.57 /8hr
Running cost/hr = RM 0.45 /hr
Total rental per hour = RM 75.45 /hr
Machinery cost
Rental per month including mobilizing to site RM 15,000.00 /month
Rental for 1 unit bulldozer (D6R Track-Type Tractor) of capacity 3.93m3 = RM 500.00 / day
(including payment for driver/operator and fuel) = RM 500.00 / 8hr
Total rental per hour = RM 62.50 /hr
Machinery cost
Rental for ½m³ excavator including mobilizing to site
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
Machinery cost
Rental for 25 tonne vibrator roller including mobilizing to site
Rental per month = RM 8,300.00 / month
Rental per day (30 days) = RM 276.67 / day
Operator = RM 70.00 / day
= RM 346.67 / 8hr
Total rental per hour = RM 43.33 / hr
Machinery cost
To use 10 tonne lorry
Lorry Cost
Transporting cost
Rental/8hr = RM 600.00 /8hr
= RM 75.00 /hr
Running cost
Lubricator (1.0 liter/7 days) x RM 25.00 = RM 3.57 /8hr
Running cost/hr = RM 0.45 /hr
Total rental per hour = RM 75.45 /hr
Material cost
Imported earth = RM 15.00 /m³
25% of compaction and wastage = RM 3.75 /m³
Total material / m3 = RM 18.75 /m³
Labour cost
General labour / hr = RM 4.69 /m³
Machinery cost
Rental per month including mobilizing to site RM 15,000.00 /month
Rental for 1 unit bulldozer (D6R Track-Type Tractor) of capacity 3.93m3 = RM 500.00 / day
(including payment for driver/operator and fuel) = RM 500.00 / 8hr
Total rental per hour = RM 62.50 /hr
Machinery cost
Rental for ½m³ excavator including mobilizing to site
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
Machinery cost
Rental for 25 tonne vibrator roller including mobilizing to site
Rental per month = RM 8,300.00 / month
Rental per day (30 days) = RM 276.67 / day
Operator = RM 70.00 / day
= RM 346.67 / 8hr
Total rental per hour = RM 43.33 / hr
Machinery cost
To use 10 tonne lorry
Lorry Cost
Transporting cost
Rental/8hr = RM 600.00 /8hr
= RM 75.00 /hr
Running cost
Lubricator (1.0 liter/7 days) x RM 25.00 = RM 3.57 /8hr
Running cost/hr = RM 0.45 /hr
Total rental per hour = RM 75.45 /hr
Material Cost
Turfing price = RM 1.00 / sqft
1 m2 = 10.76 sqft (assume 50% coverage) = RM 5.38 / m2
cost /m2 = RM 5.38 / m2
Material Cost
Grade 20 concrete = RM 201.00 /m³
cost /m² (100mm thickness) = RM 20.10 /m²
Machinery cost
Rental for ½m³ excavator including mobilizing to site
Rental per month = RM 9,500.00 / month
Rental per day (30 days) = RM 316.67 / day
Operator = RM 70.00 / day
= RM 386.67 / 8hr
Total rental per hour = RM 48.33 / hr
1. Itemized list: It presents a systematic breakdown of the project into individual items,
each representing a specific element of work or a construction activity. For example, it
may include items such as excavation, concrete works, steel reinforcement, electrical
installations, plumbing, etc.
2. Quantities: The BOQ provides the quantities or measurements of each item, specifying
the required amounts or dimensions. These quantities can be derived through methods
like taking off quantity or measurement from detailed construction drawings.
3. Unit of measurement: It specifies the unit of measurement associated with each item,
such as cubic meters (m³), square meters (m²), linear meters (m), or number of units.
4. Descriptions and specifications: The BOQ include detailed descriptions and
specifications for each item, outlining the specific materials, finishes, and quality
standards required for the construction work.
5. Rates: In some cases, the BOQ may include the rates or prices for each item, indicating
the cost per unit of measurement. However, in other instances, the rates may be left
blank, and the pricing is done separately in the tendering or procurement process.
6. Summary and totals: The BOQ often include a summary section that presents the total
quantities and costs for each trade or section of work. It provides a comprehensive
overview of the project's estimated quantities and anticipated costs.
The Bill of Quantities serves multiple purposes in construction projects. It facilitates accurate
cost estimation, as it provides a detailed breakdown of the materials and quantities required. It
also supports the tendering process by allowing contractors to submit competitive bids based
on the information provided. Additionally, it forms a basis for valuations, cost control, and
progress monitoring throughout the project's execution.
It's important to note that the specific format and presentation of a BOQ can vary depending
on project requirements, industry standards, and the preferences of the project owner or the
organization responsible for preparing the document.
5.1 Details of Bill of Quantity
5.2 Details of Bill of Quantity for Erosion and Sedimentation Control Plan (ESCP)
6.0 VALUE OF ENGINEERING
The value of engineering refers to the benefits and contributions that engineering activities and
solutions bring to society, industries, and individuals. It encompasses the positive impact that
engineering knowledge, skills, and innovations have on various aspects of human life,
including economic growth, infrastructure development, technological advancements,
environmental sustainability, and quality of life improvements.
Here are some key aspects that contribute to the value of engineering:
Overall, the value of engineering lies in its ability to transform ideas into reality, solve
problems, drive progress, and make a positive impact on society. It encompasses the practical
application of scientific knowledge, technical skills, and ethical principles to create a better and
more sustainable world.
6.1 Compliance in Value of Engineering
RATE TOTAL
ITEM NO. DESCRIPTION UNIT QUANTITY
(RM) (RM)
1.0 Clear the site of all trees (irrespective m2 269,763.69 0.72 194,618.32
of girth) undergrowth creeper, lallang,
shrubs, bushes, rubbish, debris and any
other obstruction including grubbing up
roots and stumps and cart away from
site to Contractor's own dump.
2.0 Excavate top soil average 150mm deep, m2 269,763.69 2.22 598,875.39
load and transport to temporary filling
area.
3.0 Excavation of earth materials to make m3 461,266.22 15.28 7,047,409.82
up levels to the final requisite
formation level as shown on the
Engineer's drawings
4.0 Fill and spread selected excavated m
3
474,613.12 15.56 7,386,878.60
materials to make up levels to the final
requisite formation level as shown on
the Engineer's drawings in layers and
graded each layer compacted.
5.0 Imported earth from contractor's own m³ 13,346.89 42.78 570,939.91
source within 10km from site including
unloading in filling arears.
6.0 Allow for slope protection by using spot m
2 27,629.40 8.12 224,488.36
turfing and making good every works,
defects as specified and leave
everything in perfect working order to
the entire satisfaction of the
Superintending Officer
7.0 Bench and berm:reinforced concrete m² 1,620.00 38.50 62,376.16
grade 20.
GRAND TOTAL (RM) 16,085,586.56
The total amount before considering Value of Engineering is RM 3,952,692.57 and after
considering Value of Engineering is RM 1,301,774.59. In summary, the percentage of cost
different is 67% which amounting to RM 2,650917.98.
Before considering the value of engineering, the focus on cost may primarily revolve around
minimizing expenses and achieving immediate cost savings. The emphasis may be on short-
term cost reduction without fully appreciating the long-term implications and potential benefits
that engineering can bring. In this perspective, engineering may be seen as an expense rather
than an investment.
Scheduling in project management is the process of defining a project in detail and creating a
plan for when and how it will be completed. Building a project schedule, including a timeline
with clear deadlines for each task, gives team members visibility into the work they’ll be
expected to complete and keeps everyone involved on track.
Project schedules are broken down into tasks and milestones. The schedule should also identify
all necessary resources needed to complete the project and set a timeline for completion.
Realistic constraints and dependencies must be considered during these steps, each of which is
critical for cost management (EcoSys, Hexagon AB and or its subsidiaries and affiliates,
2023) purposes.
Project schedules are created and tracked with project scheduling software which has key
features to monitor the progress of the tasks, resources, and cost in real-time. For this project,
we are using Microsoft Project software to create our project schedule as shown in (Figure 7 –
1 Work programme). The task list is prepared based on the items in the Bill of Quantities. The
details in the Task Table are shown in (Table 7 – 1 Task Table). In this table, we listed the Task
Name, Task Duration, Predecessors (dependencies) and the Resources. While in the Resource
Sheet, we listed out the resources that we are using with the rate of each resource as shown in
(Table 7 – 2 Resources Sheet).
Task Name Duration Predecessors Resources Name
SITE WORK
Clear the site of all trees (irrespective 1.2 weeks Bulldozer,
of girth) undergrowth creeper, Excavator,
lallang, shrubs, bushes, rubbish, Dumptruck, Clearing
debris and any other obstruction [269,763.69m2]
including grubbing up roots and
stumps and cart away from site to
Contractor's own dump.
1 week 2 Bulldozer,
Excavator[2],
Excavate top soil average 150mm Dumptruck[4],
deep, load and transport to temporary Excavate
filling area. [269,763.69m2]
9.9 weeks 3 Bulldozer,
Excavation of earth materials to make Excavator[3],
up levels to the final requisite Dumptruck[4],
formation level as shown on the Excavate
Engineer's drawings [461,266.22m3]
Fill and spread selected excavated 5.3 weeks 3 Bulldozer[2],
materials to make up levels to the Excavator[2],
final requisite formation level as Dumptruck[4],
shown on the Engineer's drawings in Compactor[2] Fill
layers and graded each layer and spread
compacted. [474,613.12m3]
0.3 weeks 5 Bulldozer[1],
Excavator[1],
Imported earth from contractor's own Dumptruck[4],
source within 10km from site Compactor[1] Fill
including unloading in filling arears. [13,346m3]
Allow for slope protection by using 4.3 weeks 7 Worker[4], Turfing
spot turfing and making good every [27,629.4 m2]
works, defects as specified and leave
everything in perfect working order
to the entire satisfaction of the
Superintending Officer
0.3 weeks 6,4 Worker[4],
Bench and berm:reinforced concrete Excavator[1],
grade 20. Berm[1620m2]
Table 7 - 1 Task Table
Figure 7 - 1 Work Programme
Resource Material Max. Accrue Base
Name Type Label Initials Group Units Std. Rate Ovt. Rate Cost/Use At Calendar
Worker Work W labor 6 RM0.00/hr RM0.00/hr RM0.00 Prorated Standard
Fill and
Material m3 F material RM15.56 RM0.00 Prorated
spread
Fill imported
Material m3 Fi material RM42.78 RM0.00 Prorated
material
Clearing Material m2 C RM0.72 RM0.00 Prorated
Excavate Material m2 E RM2.22 RM0.00 Prorated
Berm Material m2 B RM38.50 RM0.00 Prorated
Turfing Material m2 T RM8.12 RM0.00 Prorated
Cut Material m3 C RM15.28 RM0.00 Prorated
Table 7 - 2 Resources Sheet
From all the data that we have gathered, we estimated that the total duration of the project is
16.84 weeks (4 months and 5 days).
The duration for each activity is calculated based on the total output of the machineries and
manpower needed to complete the task against the total volume or area needed for the activity.
The calculated duration is based on both initial cost and cost after value engineering.
8.0 CONCLUSIONS
Accurate cost estimation enables project stakeholders to make informed decisions, develop
realistic budgets, and allocate resources effectively. It helps in assessing the feasibility and
viability of a project, evaluating alternative options, and managing financial risks. Additionally,
it plays a crucial role in tendering processes, contract negotiations, and cost control throughout
the project lifecycle.
While cost estimation requires expertise, experience, and access to relevant data, it is an
iterative process that may require adjustments as more information becomes available or
project conditions change. Regular monitoring, control, and refinement of cost estimates are
essential to ensure project success and avoid cost overruns.
Overall, cost estimation serves as a valuable tool for project management and helps in
achieving project objectives within defined budgets, ensuring financial accountability, and
promoting efficient resource allocation.
References
EcoSys. (2023). Hexagon AB and or its subsidiaries and affiliates. Retrieved from
https://www.ecosys.net/knowledge/project-cost-management/