Estimating for Heavy
Construction and Unit Price Bids
Hal Johnston
Faculty of Civil Engineering
Department of Economics and
Management
CZECH TECHNICAL UNIVERSITY
IN PRAGUE

Hal Johnston
◦ Professor (20 years)
 Construction Management Department
 California State Polytechnic University (Cal Poly)
 San Luis Obispo, California, USA
Short Bio
◦ Professional Construction Experience (17 years)
 Bechtel – EPC/CM
 Morrison Knudson – Design Build/General/CM
 The Austin Company – Design Build
 R.E. Bayley Construction – General Contractor
 Mason/Johnston General Contractors – General
◦ Education
 B.S. in Building Theory and Practice – Washington State University
 Masters in Building Construction – University of Florida
◦ Other
 2 books, many scholarly papers, given many professional seminars
 Latest seminar for the ASCE – Atlanta (2 days)– Fundamentals of
Construction Estimating
And ASCE – Panama (Panama Canal Authority – 10 days) Const. Estimating
Learning Outcomes for
(Estimating for Heavy Construction
and Unit Price Bids)

The attendee will be able to:
◦ Discuss how heavy construction estimating is
different from commercial estimating
◦ Describe a unit price bid
◦ Decide when and where the different types of
estimates are used
◦ Illustrate the different parts of the unit price
estimate and describe them
◦ Explain how the different types of cost play a
role in heavy construction estimating
Session Outline



Construction organizations (review)
Construction contracts (review)
Contract documents

Unit prices


Quality control / acceptance
Price adjustments
◦ Standard specifications
◦ Standard specifications for DOTs
◦ Unit bid items
◦ WSDOT Unit bid items
◦ Short in-class exercise
History of Project Delivery in US

Legal Separation of Design and
Construction
◦ The Miller Act (1935)
◦ Public contracting laws mandating separation of
design from construction & contractor selection
solely on cost
◦ Professional licensing requirements
Project Delivery Defined
A comprehensive process including
planning, design, construction and other
services, necessary for organizing,
executing and completing a construction
project.

Three fundamental owner decisions
◦ Type of project delivery system
◦ Type of procurement method
◦ Type of contract format
Project Delivery Process
Framework
Project
Feasibility
Facility
Owner’s
Profile
Critical
Owner
Decisions
Project
Performance
Criteria
Project
Delivery
System
Selection
Contract
Format
Selection
Procurement
Method
Selection
Programming
& Scope Definition
Team
Selection
Confirm Project
Scope and Program
Project
Financing
NOTE: Chart shows logic flow, not
timing or sequence of steps, which
vary depending on methods used.
Design &
Construction
Operation &
Maintenance
Project Delivery

Always 3 or 4 major parties involved in
the project delivery process
◦
◦
◦
◦
Owner (public or private)
Designer (Engineer or Architect)
Contractor
Construction Management Firm (can also be
one of these parties)
The Method Selected will:
Determines the contractual relationships
among the parties.
 Establishes when the parties become
engaged.
 Influences impact of changes and
modifications on project cost.

Project Delivery Types





Design-bid-build (Lump Sum or Unit Price)
Multi-prime (often under CM)
Construction management-at-risk
Construction Management agency
Design-build (DB, EPC, etc.)
Procurement Defined
Procurement is the
methodology used to buy
design and construction
services.
Construction Contracts

Method of pricing
◦ Fixed-price
 Lump sum contract
 Unit price contract
◦ Cost-plus
 Cost plus percentage
of cost
 Cost plus fixed fee
 Cost plus fixed fee
with a targeted
maximum cost
 Cost plus incentive
fee
◦ Guaranteed Max Price
 GMP plus percentage
of cost
 GMP plus fixed fee
 GMP plus a fixed fee
plus share of savings
- incentive

Method of award
◦ Competitively Bid
contracts
 With designer doing
Project Supervision
 With CM – agency
 CM at Risk
 Design Build
◦ Negotiated contracts
 GMP
 Design Build
 Negotiated Lump
sum
 CM at Risk
Procurement Options
Sole Source/Direct Selection
 Negotiated procurement
 Competitive

◦ QBS – Qualification Based Selection
◦ BVS - Best Value Selection
◦ Low Bid
Market Penetration of Major
Project Delivery Systems
Design-Bid-Build
Owner
Contractual Relationship
Sub Consultants
Characteristics



Designer
Three linear phases:
Design, bid and build
Three prime players:
Owner, designer, constructor
Two separate contracts:
 Owner to designer
 Owner to constructor
Responsibilities
Owner Program, finance, management
Designer Prepares plans & specs, normal
services
Constructor Prime and sub construction
Contractor
Subcontractors
Design-Bid-Build
Advantages
◦
◦
◦
◦
Established way of doing things
Suitable for competitive bidding
A/E directly works for owner
Extensive litigation has resulted in well
established legal precedents
◦ No legal barriers in procurement and licensing
◦ Insurance and bonding are well defined
Design-Bid-Build
Disadvantages
◦ Two contracts for owner to manage
 Disagreements go through owner
 Owner bears design adequacy risk
◦ All parties have different agendas/objectives
◦ Initial low bid might not result in final best
value
◦ Bids over budget presents most difficulties in
reducing costs / creates significant delay
◦ No constructor involvement in design
◦ Slowest project delivery
◦ Most litigious delivery process
Design-Bid-Build
Unique attributes and challenges
Utilization helps to avoid potential conflicts of
interest
 Provides a check and balance between design
and construction functions
 Owners less familiar with the design and
construction process may benefit from DesignBid-Build because it is so well understood
throughout the building industry.

Primary Reasons for Choosing
Design-Bid-Build





Low first cost is the priority
Project is simple
Procurement laws restrict use of anything
else
Owner wants to control design
No need for value engineering or
innovation
Influence vs. Cost
Project delivery selection influences when contractor gets on board.
Contractor on-board early allows best opportunity to achieve objectives
RAPIDLY
DECREASING
INFLUENCE
MAJOR
INFLUENCE
Large
LOW
INFLUENCE
High
COST
INFLUENCE
Low
Planning & Design
Small
Construction & Operations







Equipment productivity
Labor productivity
How material may react differently in
different circumstances
Locations
Lower number of subcontractors on job,
higher risk to the General
Fuel costs
Soil Conditions (acting different than
expected)
Risk in Heavy Construction
How does Risk change the
Estimate?

Higher profits
◦ Commercial Profits – 1% to 5%
◦ Heavy Profits – 8% to 15%

Less return on investments
◦ Large cost of equipment

Contingencies for potential
escalation costs
Standard Specifications for DOT
(Department of Transporation)
Typically do not use MasterFormat 2004
 Generally use 9 Divisions
◦ General Requirements
◦ Earthwork
◦ Production from Quarry and Pit Sites and
Stockpiling
◦ Bases
◦ Surface Treatments and Pavements
◦ Structures
◦ Drainage Structures, Storm Sewers, Water
Mains, and Conduits
◦ Miscellaneous Construction
◦ Materials
Standard Specifications for most
Commercial / Building Projects


Typically used today is the MasterFormat 1995
edition, but a new edition has been published
(2004)
MASTERFORMAT 1995 EDITION
Before November 2004, MasterFormat was composed of 16 primary divisions:
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
Division
1 — General Requirements
2 — Site Construction
3 — Concrete
4 — Masonry
5 — Metals
6 — Wood and Plastics
7 — Thermal and Moisture Protection
8 — Doors and Windows
9 — Finishes
10 — Specialties
11 — Equipment
12 — Furnishings
13 — Special Construction
14 — Conveying Systems
15 — Mechanical
16 — Electrical
Standard Specifications for most
Commercial / Building Projects

MASTERFORMAT 2004 EDITION
After November 2004, MasterFormat was composed of 49
primary divisions:
The current MasterFormat Divisions are:
Division 1 - 49

Divisions
MasterFormat 1995
Introductory Information
Bidding Requirements
Contracting Requirements
1 General Requirements
MasterFormat 2004
Procurement and
Contracting
Requirements Group
00 Procurement and
Contracting Requirements
Specifications Group
General Requirements
Subgroup
01 General Requirements
Divisions
MasterFormat 1995
MasterFormat 2004
Facility Construction
Subgroup
2 Site Construction
02 Existing Conditions
3 Concrete
03 Concrete
4 Masonry
04 Masonry
5 Metals
05 Metals
6 Wood and Plastics
06 Wood, Plastics, and Composites
7 Thermal and Moisture
Protection
07 Thermal and Moisture
Protection
8 Doors and Windows
08 Openings
Divisions
MasterFormat 1995
MasterFormat 2004
Facility Construction
Subgroup (continued)
9
Finishes
09 Finishes
10 Specialties
10 Specialties
11 Equipment
11 Equipment
12 Furnishings
12 Furnishings
13 Special Construction
13 Special Construction
14 Conveying Systems
14 Conveying Equipment
15 – 19 Reserved
Divisions
MasterFormat 1995
MasterFormat 2004
Facility Services Subgroup
20 Reserved
13 Special Construction
21 Fire Suppression
15 Mechanical
22 Plumbing
15 Mechanical
23 Heating, Ventilating, and Air
Conditioning
24 Reserved
Divisions
MasterFormat 1995
MasterFormat 2004
Facility Services Subgroup
(continued)
13 Special Construction
25 Integrated Automation
16 Electrical
26 Electrical
13 Special Construction
27 Communications
13 Special Construction
28 Electronic Safety and Security
29 Reserved
Divisions
MasterFormat 1995
MasterFormat 2004
Site and Infrastructure
Subgroup
30 Reserved
2 Site Construction
31 Earthwork
2 Site Construction
32 Exterior Improvements
2 Site Construction
33 Utilities
2 Site Construction
34 Transportation
2 Site Construction
35 Waterway and Marine
36-39 Reserved
MasterFormat 2004










31 00 00 EARTHWORK
31 10 00 SITE CLEARING
31 20 00 EARTH MOVING
31 30 00 EARTHWORK METHODS
31 40 00 SHORING AND UNDERPINNING
31 50 00 EXCAVATION SUPPORT AND PROTECTION
31 60 00 SPECIAL FOUNDATIONS AND LOAD-BEARING
ELEMENTS
31 70 00 TUNNELING AND MINING
31 80 00 Reserved
31 90 00 Reserved
Division 31 - EARTHWORK
Divisions
MasterFormat 1995
MasterFormat 2004
Process Equipment Subgroup
11 Equipment
40 Process Integration
11 Equipment
41 Material Processing and
Handling Equipment
11 Equipment
42 Process Heating, Cooling and
Drying Equipment
11 Equipment
43 Process Gas and Liquid
Handling, Purification and Storage
Equipment
Divisions
MasterFormat 1995
MasterFormat 2004
Process Equipment Subgroup
(continued)
11 Equipment
44 Pollution Control Equipment
11 Equipment
45 Industry-Specific Manufacturing
Equipment
46-47 Reserved
16 Electrical /
Special Construction
13
48 Electrical Power Generation
49 Reserved
Unit Prices

Standard Units
◦ Defined in Standard Specifications
Unit Bid Items / Bid
03-0E2004 BID245
03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E R PAGE 7
04/23/08 04/27/08
----------------------------------------------------------------------------------------------------------------------------------ITEM ITEM UNIT OF ESTIMATED
NO. CODE ITEM DESCRIPTION MEASURE QUANTITY BID AMOUNT
----------------------------------------------------------------------------------------------------------------------------------1
074016
CONSTRUCTION SITE MANAGEMENT
LS
10,000.00
2 (S)
074017
WATER POLLUTION CONTROL PROGRAM
LS
1,000.00
3
074032
TEMPORARY CONC WASHOUT FACILITY
EA
1,500.00
4 (S)
120090
CONSTRUCTION AREA SIGNS
LS
3,000.00
5 (S)
120100
TRAFFIC CONTROL SYSTEM
LS
150,000.00
6 (S)
128650
PORTABLE CHANGEABLE MESSAGE SIGN
LS
20,000.00
71
50662
REMOVE METAL BEAM GUARD RAILING
LF
39,120.00
8
150771
REMOVE ASPHALT CONCRETE DIKE
10.00
8,400.00
9
011868
REMOVE PRECAST CONC POST SUPPORT
EA
5,000.00
10 (S)
153103
COLD PLANE ASPHALT CONC PAVEMENT
SQYD
16,500.00
11
160101
CLEARING AND GRUBBING
LS
10,000.00
12
190101
ROADWAY EXCAVATION
CY
56,250.00
13
193006
STRUCTURE BACKFILL (SLURRY CEMENT)
CY
1,250.00
14
260201
CLASS 2 AGGREGATE BASE
CY
5,750.00
15
390132
HOT MIX ASPHALT (TYPE A)
TON
55,000.00
16
394077
PLACE HOT MIX ASPHALT DIKE (TYPE F)
LF
7,050.00
17
394090
PLACE HOT MIX ASPHALT (MISC AREA)
SQYD
1
10,000.00
1
1,000.00
1
1,500.00
1
3,000.00
1
150,000.00
1
20,000.00
6,520
LF
2
550
1
6.00
840
2,500.00
30.00
10,000.00
450
125.00
45
250.00
23
250.00
550
100.00
1,410
5.00
2,380
35.00
03-0E2004 BID245
03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E
R PAGE 7
04/23/08 04/27/08
----------------------------------------------------------------------------------------------------------ITEM
NO.
ITEM
UNIT OF
CODE
DESCRIPTION
MEASURE
----------------------------------------------------------------------------------------------------------ESTIMATED
UNIT
BID
QUANTITY
PRICE
AMOUNT
----------------------------------------------------------------------------------------------------------2 (S) 074017
WATER POLLUTION CONTROL
PROGRAM
LS
1
$
1,000.00
$ 1,000.00
_______________________________________________________
_____
4 (S)
120090
CONSTRUCTION AREA SIGNS
LS
1
$ 3,000.00
$ 3,000.00
_______________________________________________________
______
5 (S)
120100
TRAFFIC CONTROL SYSTEM
LS
1
$ 150,000.00
$ 150,000.00
___________________________________________________
__________
7 1 50662 REMOVE METAL BEAM GUARD RAILING
UNIT OF
ESTIMATED UNIT
BID
MEASURE QUANTITY
PRICE
AMOUNT
-----------------------------------------------------------------------------LS
1
$ 98,000.00
$
98,000.00
TOTAL $ 980,685.00
Heavy Estimates take on two styles:
Detail Estimates for Lump Sum
Contracts and Subcontracts
 Unit Price Estimates for DOT and
other Unit Price Contracts

Remember that Heavy/Civil
Contractors may act as
Subcontractors on many projects
A Heavy Civil Detail Estimate
looks much like a Detail Estimate
for a Commercial Project

Major Differences
◦
◦
◦
◦
◦
◦
Larger labor component
Larger equipment component
Very few Subcontractors
More self performed work
Not as many activities or work items
Work items are often quantified by the
agency for Unit Price Estimates
Structure of a Lump Sum
Estimate and Bid

Summary Sheet Headings
◦
◦
◦
◦
◦
◦
◦
◦
◦
Description
Labor
Material (often called Permanent Materials)
Consumables / Expendables (often called
Expendable Materials)
Subcontractors
Equipment Operating Costs or Expense
Repair Costs (Labor item)
Rental Costs or Company Equipment Costs
Total
Typical Lump Sum Bid
Description
Direct
Costs
Jobsite
Indirect
Costs
End of Bid
Items
Total Bid
Labor
Materials
Expendables
Subs
Equip
Operating
Costs
Repairs
Rent
Total
Typical Unit Price Bid
03-0E2004 BID245
03-SIE-49-2 C O N T R A C T P R O P O S A L O F L O W B I D D E R PAGE 7
04/23/08 04/27/08
----------------------------------------------------------------------------------------------------------------------------------ITEM ITEM UNIT OF ESTIMATED
NO. CODE ITEM DESCRIPTION MEASURE QUANTITY BID AMOUNT
----------------------------------------------------------------------------------------------------------------------------------1
074016
CONSTRUCTION SITE MANAGEMENT
2 (S)
074017
WATER POLLUTION CONTROL PROGRAM
LS
LS
1
1
3
4 (S)
5 (S)
6 (S)
71
8
9
10 (S)
11
12
13
14
15
16
17
18 (F)
19
20
21 (SF)
22
23
24 (S)
25
26 (S)
27 (S)
28 (S)
29 (S)
30 (S)
31
EA
LS
LS
LS
LF
LF
EA
SQYD
LS
CY
CY
CY
TON
LF
SQYD
CY
EA
EA
LB
EA
EA
LF
LF
EA
EA
EA
EA
LF
LS
1
1
1
1
6,520
840
2
550
1
450
45
23
550
1,410
2,380
4.9
24
32
916
69
4
6,690
10
10
5
5
3
350
1
074032
120090
120100
128650
50662
150771
011868
153103
160101
190101
193006
260201
390132
394077
394090
510502
011869
011870
750001
820108
820151
832002
832008
839541
839552
839581
839585
840656
999990
TEMPORARY CONC WASHOUT FACILITY
CONSTRUCTION AREA SIGNS
TRAFFIC CONTROL SYSTEM
PORTABLE CHANGEABLE MESSAGE SIGN
REMOVE METAL BEAM GUARD RAILING
REMOVE ASPHALT CONCRETE DIKE
REMOVE PRECAST CONC POST SUPPORT
COLD PLANE ASPHALT CONC PAVEMENT
CLEARING AND GRUBBING
ROADWAY EXCAVATION
STRUCTURE BACKFILL (SLURRY CEMENT)
CLASS 2 AGGREGATE BASE
HOT MIX ASPHALT (TYPE A)
PLACE HOT MIX ASPHALT DIKE (TYPE F)
PLACE HOT MIX ASPHALT (MISC AREA)
MINOR CONCRETE (MINOR STRUCTURE)
PRECAST CONC POST SUPPORT (8 FOOT)
PRECAST CONC POST SUPPORT (6 FOOT)
MISCELLANEOUS IRON AND STEEL
DELINEATOR (CLASS 2)
OBJECT MARKER (TYPE L-1)
METAL BEAM GUARD RAILING (STEEL)
METAL BEAM GUARD RAILING (ELEMENT)
TRANSITION RAILING (TYPE WB)
TERMINAL SECTION (TYPE C)
END ANCHOR ASSEMBLY (TYPE SFT)
ALTERNATIVE FLARED TERMINAL SYSTEM
PAINT TRAFFIC STRIPE (2-COAT)
MOBILIZATION
10,000.00
1,000.00
10,000.00
1,000.00
1,500.00
3,000.00
150,000.00
20,000.00
6.00
10.00
2,500.00
30.00
10,000.00
125.00
250.00
250.00
100.00
5.00
35.00
10,000.00
1,500.00
1,500.00
5.00
40.00
50.00
27.50
20.00
5,000.00
150.00
1,000.00
3,000.00
6.00
98,000.00
TOTAL
1,500.00
3,000.00
150,000.00
20,000.00
39,120.00
8,400.00
5,000.00
16,500.00
10,000.00
56,250.00
1,250.00
5,750.00
55,000.00
7,050.00
83,300.00
49,000.00
36,000.00
48,000.00
4,580.00
2,760.00
200.00
183,975.00
8,200.00
50,000.00
750.00
5,000.00
9,000.00
2,100.00
98,000.00
980,685.00
Typical Lump Sum Bid
Typical Unit
Price Bid
In-directs are totaled
Each big item is calculated as a
percentage of the total direct costs
 Using this percentage, we multiply the
total direct costs by each percentage
 That number is than added to the base
direct cost to come up with a total.
 It is divided by the quantity to generate a
unit price


Major Difference: Distribution of
Indirect Cost into Unit Prices





First the In-directs and end of bid items
are totaled.
A total of direct costs is also established
with a total
A column of each bid item direct cost is
made into a % of the total direct costs.
This % is then multiplied by the total
indirect cost
This % of the indirect costs is than added
to the direct costs
How do we do this Distribution of Indirects?
Item No.
390132
Unit
TON
Description
HOT MIX ASPHALT (TYPE A)
Quantity
550
Unit Price
$ 100.00
Total
$ 55,000.00
The Result is:
Example of Bid Item
Specification are reviewed for the
Item No., what is included in each
work items and how the item will be
paid for.
The Pay Quantity vs. Bid
Quantity

Bid quantity ◦ Defined as a quantity of individual units of
work that represents the owner’s engineer’s
estimate of the number of units of that type
work included in the contract.

Pay quantity ◦ Defined as the quantity that is calculated
when the work is completed and will be paid
for by the owner
Is also defined as the quantity of
projected work at time of bid
 Is the calculated quantity by the
contractor when checking engineer’s
quantity
 May or may not equal the engineer’s
quantity

Work quantity
Relationship of the work
quantity to the Bid Item
It is generally thought by the engineer to
be equal.
 This is not always true as many
contractors have found out – sometimes
by surprise


When bidding a lump sum, the quantities are
not given and certified by the owner. The
contractor is responsible for quantity
determination. The owner will pay the lump
sum bid amount plus any changes.

When bidding a unit price contract, the engineer
is giving the contractor the quantities and will
pay the contractor the in-place quantities.
Provisions are made when quantities get
substantially out of balance.
Indirect Cost : Lump Sum vs. Unit
Price

Major Differences are:
◦ Mobilization costs and items are substantially
different. Plant and equipment of large heavy
projects.
◦ Temporary access / roads etc. can be very
different
◦ Temporary power on a commercial project is
much different.
◦ Surveying requirements can be much different
from commercial to heavy construction.
Indirect Costs from Commercial
compared to Heavy
To protect out of pocket expenses
because of inaccurate bid quantities
 To favor work performed early in the
schedule to create positive cash flows
on project
 Other strategies

Is there any Strategy to Distribution
of Indirect Project Costs?
Unbalancing the Bid

What words should we be watchful in
bidding documents?
◦ “grossly unbalanced”
◦ “substantially unbalanced”

First on a Balanced Bid

Next on an Unbalanced Bid
◦ Most DOT specifications allow for change if
quantities are grossly inaccurate. If there is no
provision, the contractor could have the wrong
equipment, too much equipment etc.
◦ Contractor plays the risk of being determined as
non responsive and bid being rejected.
◦ Owner could be paying a premium on the work.
What Happens if there are Inaccurate
Bid Quantities?
What Happens if there are
Inaccurate Bid Quantities on
a Balanced Bid?
Most DOT specifications allow for change if
quantities are grossly inaccurate. If there is
no provision, the contractor could have the
wrong equipment, too much equipment, etc.
What Happens if there are
Inaccurate Bid Quantities on
a Unbalanced Bid?
Contractor plays the risk of being determined
as non responsive and bid being rejected.
Owner could be paying a premium on the
work.
Rejection Can be the
Consequences of Unbalanced
Bid.
Owner will use the term:
Non-responsive
03-0E2004 BID245
03-SIE-49-2 S U M M A R Y O F R E M A I N I N G B I D D E R S PAGE
9
04/23/08 04/27/08
|-----------------------------|------------------------------ITEM| SIXTH
| SEVENTH
| BID AMOUNT
| BID AMOUNT
|-----------------------------|------------------------------1 | 8,000.00
8000.00
| 650.00
650.00
2 | 1,500.00
1500.00
735.00
735.00
3 | 2,000.00
2000.00
| 2,300.00
2300.00
4 | 3,200.00
3200.00
| 1,540.00
1540.00
5 | 146,000.00 146000.00
| 112,777.24
112777.24
6 | 12,500.00 12500.00
| 4,800.00
4800.00
7 | 10.00
65200.00
| 6.80
44336.00
8 | 11.00
9240.00
| 21.00
17640.00
9 | 2,000.00
4000.00
| 480.00
960.00
10 | 18.00
9900.00
| 15.70
8635.00
11 | 10,000.00 10000.00
| 15,124.00
15124.00
12 | 65.00
29250.00
| 556.80
250560.00
13 | 340.00
15300.00
| 5,346.66
240599.70
14 | 240.00
5520.00
| 401.99
9245.77
15 | 130.00
71500.00
| 127.73
70251.50
16 | 4.50
6345.00
| 2.35
3313.50
17 | 35.00
83300.00
| 30.03
71471.40
18 | 4,800.00 23520.00
| 1,885.70
9239.93
19 | 2,200.00 52800.00
| 3,450.00
82800.00
20 | 2,000.00 64000.00
| 3,400.00
108800.00
21 | 5.00
4580.00
| 8.20
7511.20
22 | 50.00
3450.00
| 42.00
2898.00
23 | 50.00
200.00
| 41.80
167.20
24 | 30.00
200700.00
| 29.24
195615.60
25 | 35.00
14350.00
| 43.50
17835.00
26 | 6,600.00 66000.00
| 3,600.00
36000.00
27 | 120.00
600.00
| 98.00
490.00
28 | 1,250.00 6250.00
| 624.00
3120.00
29 | 3,000.00 9000.00
| 2,800.00
8400.00
30 | 11.00
3850.00
| 6.72
2352.00
31 | 100,000.00 100000.00
| 157,316.00
157316.00
TOT 1,032,055.00
1,487,484.04
How can an
Owner tell
or why
would they
even
question
the
Contractor’
s Unit
Prices?
Other Bid # 3
Item
No.
8
8
Other Bid # 5
150771 REMOVE ASPHALT CONCRETE DIKE LF 840
Unit
Price Total
11.00 9240.00
Unit
Price Total
21.00 17640.00
Possible Example
Remember earlier we spread our indirects and end of
bid items over our direct cost items.
 We did that based on each cost items value and gave
each item a piece of the indirect costs based on that
value. More costly items got more of the indirect cost.
 Instead of doing a percentage of each direct cost item,
one could allocate any amount of the indirect costs to
that bid items.
 We could even go so far as moving direct costs onto
another direct cost in increase its total, keeping in
mind that we would want to keep the total the same
as a balance bid.

Example of Unbalancing:
Fixed Costs, In-directs, etc.
Flow chart of the Heavy Bid Process
Quantities are checked against the Engineers
End of bid item distributed to Bid items
Unit Price Estimates and The Bid Process
Selection\Decision & Review Phase
Select Project
Review the Plans
Specs. & Contract
 Does work fit with-in the company business
plan?
 Does the company have the bonding capacity to handle
the work?
 Probability of making a profit?
 Is it the type of work the company and its individuals can
succeed at?
 Does my company have the right plant and equipment?
Preparation for Pricing
Subcontractor
Determinations
Begin Takeoff
for Self Work
Request for
Material Quotes
Site Visit
Estimator determines the scope of work
that will be subcontracted. This is a
much smaller group of subcontractors.
Estimator begins takeoff of quantities of
work this contractor will do with their own
forces. They will review the
specifications for what to include in both
the pay quantities and work quantities.
Estimator determines the scope of
materials and sends out for quotes.
Heavy contractors often control their own
materials. i.e. rock, asphalt, concrete
Estimator schedules a site visit
(Mandatory vs. Voluntary).
Preparation for Pricing Continued:
Request for
Sub bids
Job Plan &
Preliminary
Scheduling
Historical labor &
Material Cost
Records Reviewed
General Conditions
and Indirect Job
Cost Determination
Much more time it spent
On the job plan and scheduling
Because of the plant and
Equipment requirements
Analysis and Pricing
Budgeting for Sub trades
Labor Pricing
Material Pricing
Plant and
Equipment Pricing
Indirect Job Cost Pricing
Subcontract Bid Tab.
Cost Extensions & Finalizing the Estimate
Estimate Summary
End of Bid Items
(Profit & Overhead)
Distribution of
End of Bid Items
To the Bid Items
Finalizing the Estimate
Adjustment to
Bid or Proposal
Owner’s Final
Review
Bid or
Proposal
Submission
Award of
Project
Review & Log
for Historical
Can be very similar to commercial process
when bidding a lump sum.
 But is very different when bidding a unit
price type of contract
 Materials can play a major role in the bid
process
 Plant and equipment are a big portion of
the work

Heavy Bid Process
The use of digitizers is used more that in
commercial because of the speed of
earthwork takeoff process.
 Also almost all heavy estimating is done
with computers because of the need to
distribute the indirect costs in unit price
estimates.

Heavy Bid Estimating
Summary
Heavy Civil can be either Lump
Sum or Unit Price.
 The Heavy Civil world also does
negotiated work.
 More risk is associated with Heavy
Construction work vs. Commercial
work.

◦ Equipment productivity
◦ Labor productivity
End of Today’s Session
Questions?