CMGT 5330 Discussion 1

0 Words CMGT 5330 Discussion Posts Week 1 In order to compile a complete estimate of the project, the manager must consider the direct costs as well as the indirect costs of a job. Direct costs for the work performed are built upon accurate takeoffs of all units of work as shown in the contract documents. The takeoffs, in conjunction with a thorough understanding of what means and methods will be used to complete each operation during the project, will then be used to calculate a) materials costs, based on quotes obtained from suppliers (the manager should account for possible escalations of the price in in between when the price was obtained and when the materials will be used on site), b) labor costs, based on historical production rates for the contractor's crews as well as the wage schedule that will be utilized on the project (open shop, union, or prevailing wage), c) equipment costs which include the cost of operation as well as cost of investment and cost of ownership if it makes sense to buy or lease the equipment instead of renting it. When it comes to listing accurate estimates for direct costs, the project manager must work with the estimating team to evaluate not only the drawings and specifications, but also the actual site conditions and any circumstances that will affect production rates, such as location, weather, jobsite security, available laydown area, availability of trained manpower, and many other factors that can lead to a project not being profitable. For example, a project I previously worked on had a problem with graffiti on the temporary construction fencing-the owner required that all graffiti be either painted over or that construction fencing screens be replaced, and the costs added up very quickly as new graffiti would pop up on a daily basis. Because the team was familiar with the area of town and took the time to visit the jobsite before finalizing their bid, these costs were accounted for and recouped from the owner as a contingency. In addition to the cost of the general conditions and all self-performed work, bids from all subcontracted work must be solicited and reviewed as part of the cost of the project. A manager who has a good working relationship with subcontractors of various trades will be able to reach out to the companies that she knows would be best suited to do the work. Furthermore, job overhead and general overhead must be included in the cost of every project. Job overhead will include jobsite office and parking space rentals, job-specific laydown yard rentals, utilities, supplies, the pay of salaried staff, engineering and testing (if not explicitly paid for directly by the owner), catered lunches, among many others. The cost of general overhead will be charged to support main office salaries, rent, contractor licenses and insurances, shops, yards, technology fees, software licenses and training, and any other expenses that cannot be directly tied to the project.
0 Words The manager must then also account for all the indirect costs of the project-taxes, bonds, insurance, and any other requirements outlined in the bid documents. The total cost to the owner will also include a fee, or profit.
Uploaded by ProfessorElkMaster869 on