Unit 4: Rate Analysis s® Definition : "Rate analysis is define as the process of determining the rate per unit of an item of work considering the cost of materials, labours, plants & equipment's required." In order to determine the rate of particular item, the factor affecting the rate of that item are studied carefully & then finally a rate is decided. x Purpose/Necessity/Importance of Rate Analysis : 1) To workout the actual cost per unit of the items at that locality. 2) To check the rates offered by the contractor. 3) To calculate the number of materials and labour strength required for project planning 4) To fixed labour contract rates. 5) To workout the economical use of materials and processes in completing the particular item. 6)To workout the cost of extra items which are not provided in the contract bond, but are to be done as per directions of the department. 7)To revise the schedule of rates due to an increase in the cost of materials and labours or due to change in technology. 8)To examine the most economical method of construction. 9)To prepare a supplementary estimate or revised estimate. 10)rate analysis is important to know the quantity of material required for particular item of work which is useful in storage of materials, for site, for budget provision etc. s# Factor affecting rate analysis: following are the factors affecting rate Analysis 1) Cost of materials: > Materials are the major part required for the construction work. > about 50% of total cost of work is due to the cost of materials, hence it is necessary to workout the exact quantity of material required. >the excess quantity of materials or the shortage of materials greatly affected the rate analysis. >cost of materials includes material costs, transportation costs, sales tax and insurance © scanned wen onenscamer2) Cost of labours: > number of labours required for the work is worked out correctly. > about 30% of total cost of work is due to the labours only. > the rates of labours varries from place to place and depends upon types of labour such as skilled, semi skilled and unskilled labour. 3) Specification of item: >Specifications of items shows the proportion of materials, the method of construction and execution of work. >if superior quality of material used the rates will be higher. 4) Tools and plants: > different types of tools and plants necessary for execution of work. > used of special equipment will increase the cost of construction. 5) Overhead charges/ Work charge establishment : > overhead charges mainly consists of office expenses, expenditure on labour, chaukidar, mistries etc. >a provision of 2% to 2.5% of estimated cost should be made for overhead charges. 6) Contractor Profit : >Normally 10% of the actual cost of work is considered as contractor profit. xf Important Terminologies : 1) Lead: > Itis the horizontal distance upto which the excavated earth will be carried or transported on the ground from source to the place of spreading. > hence the cost of conveyance of material depends on the lead. > Itis the horizontal movement of material. > normally lead is taken as 30m. > seperate measurement are taken for every 30m of lead. > Extra lead is the difference between actual lead and standard lead. for extra lead rates will be different. 2) Lift: > Itis the vertical distance calculated from the ground level upto which the labour have to excavate the soil . > It is the vertical movement of material. > normally lift is taken as 1.5m > seperate measurement are taken for every 1.5m of lift. conversion of lift to lead (upto 3.60m lift) .....Lead=liftx10 (3.6m to 6.0m lift) .....Lead= (lift)?x 3.3 (26.0m lift) ... Lead= (lift)?x20 © scanned wen onenscamer3) Overhead Charges : > Overhead cost include general office expenses, rents, taxes, supervision, salaries of office staff and travelling etc. > It is on temporary basis & usually 2 to 2.5% of estimated cost. > overhead charges increases if the project is delayed. > overhead charges divided into a) General Overhead : general overhead are those incurred by the contractor in the overall management of busines in office like + Establishment (office staff) + stationary, printing, postage etc + Travelling expenses. + telephone + rent & taxes. + general business insurance b) Job Overhead : Job overhead are those costs at the project site which occure specifically as a result of that particular project like + job supervision & officer personel. + site security + temporary material storage + temporary officer at site + handling of material charges + tools and plants at site requirements + salaries of all staff + amenities to labour and staff :4) Contractors Profit : > contractor means a person or firm who undertake any type of contract. > normally the profit of 10% of total estimated cost should be considered as contractor's profit. > for small jobs 15% profit and for large jobs 8% profit shall be considered. > if cement and sand supplied by department then 10% profit is not given on cement and sand to the contractor. 5) Water charges : > water is necessary for all construction work like rc, pcc, brickwork, plastering etc on site. > normally the water is made available for site from tubewell or purchase temporary from municipal corporation of respective site. > normally water charges for construction work is taken as 1.5 to 2% © scanned wen onenscamer