Estimating – Pricing & Cost Control

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Estimating – Pricing & Cost Control Training

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.

 

  1. INTRODUCTIONS
  2. 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.

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