Estimating – Pricing & Cost Control
- Course focuses on cost control problems in projects, estimating techniques, contract types, cash flow importance, and pricing strategies.
- Participants address typical cost control problems and work methods during the course.
- Course covers product and work breakdown structures, estimating methods, contract types, and payment terms.
- Emphasizes cash flow importance, payment evaluations, pricing strategies, and cost reduction techniques.
- Includes sessions on managing change, control processes, and bidding for lump sum contracts.
Overview
The Estimating – Pricing & Cost Control Training course aims to address cost control issues in project management. Participants learn to define project scope, develop controls, and understand estimating techniques. Topics include different contract types, procurement assessment, cash flow importance, pricing strategies, cost reduction, and change management. The course emphasizes monitoring scope, schedule, cost, quality, and resources for effective cost control. Practical exercises and case studies enhance learning. The course duration is 2 days.
Who should attend
Estimators, Procurement Managers, Project Managers, Cost Controllers
Course Content
Each participant to bring a brief description (half page maximum) of a typical cost control problem, or cost/estimating work method, that has been or is a problem, in the control of projects or work assignments. These issues will be addressed during the course.
- INTRODUCTIONS
- THE FOUNDATION STONE – Defining the What
(Lecture & Group Exercises)
To demonstrate the use of product and work breakdown structures to describe the scope of the project and develop the basic controls.
3. THE BENCHMARK – Estimating How Much (Lecture & Case Study)
Intensive lecture covering aspects of estimating.
- Approaches to Estimating.
- Elements of Estimating.
- Estimate planning sequence.
- Types of Estimate.
- Make-up of an Estimate.
- Using the correct estimating technique.
- Uses of different types of estimates.
Estimating case study describing the methods used by the various departments of a company to prepare an estimate.
Cost – Profit – Price
3.TYPES OF CONTRACT
The different types of contract and their payment terms.
4. PROCUREMENT & TENDER ASSESSMENT (Lecture & Exercises)
- Determination of the criteria in selecting tenderers (Brainstorming session).
- ‘Which would you Pick 1’. Attitudes in choosing the supplier. (Exercise)
- The tender assessment criteria. ‘Which would you Pick 2’
- Evaluating the payment terms of the tenders. (Exercises)
- The marking criteria and the pros. & cons. of weighted evaluations.
5. CASH and PROFIT (LECTURE & EXERCISES)
- Identify the importance of cash flow in the life of projects.
- More advanced method for evaluating the payment terms in a bid – Net Present Value.
- The effect of the payment terms on the pricing of the tender The advantages of progress payments v’s 100% upon completion.
- “Which Would You Pick” Tender Comparison – Analysis of the payment terms (Exercise).
6. PRICING (LECTURE & EXERCISES)
- Brief brainstorming session to identify different ways of pricing.
- Pricing exercise for providing services over an extended time period.
- How to make the tender look cheaper – brainstorming and discussion.
7. PAYMENT of PRICE (LECTURE & EXERCISES)
Pricing and payment strategies – mini cases.
8. REASONS FOR COST CREEP (Group Exercise)
A brainstorming session to identify the reasons and areas of cost escalation.
9. COST REDUCTION (Lecture & Discussion)
A review of the issues involved in reducing the costs.
- Redesign, scope and specification.
- Breakdown v’s Make-up.
- Negotiating the deal.
- Pricing or costing changes.
10. THE CONTROL PROCESS (Lecture)
- The control cycle.
- The importance of monitoring Scope, Schedule / Time, Cost, Quality and Resources.
- The easy and theoretical answer to cost control.
- Controlling time.
11. MANAGING CHANGE (Lecture)
- Definitions of different types of changes and what the contract should say.
- Managing change through the trend programme.
- Illustrating the effect of change and the cumulative effect using ‘S’ Curves.
12. THE SPAN CONTRACT (Time Permitting) (Group Exercise)
Estimating and Bidding for a Lump Sum Contract with all the Inherent Risks Involved. Managing the practical realities of a Lump Sum Contract.
Duration:2 Days
Cost:£595 + VAT
Cost Control Training Scotland, Inverness, Aberdeen, Glasgow, Edinburgh, Dunfermline and other sites throughout the UK including onsite closed company courses are available.
