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The Basics of Conceptual Cost Estimating

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Before we start any construction project or even come up with the design, we need to know much more about the specific project. From the initial meeting, we typically don’t know the duration it’s going to last or how much it’s going to cost, therefore, we must do things in a certain order. It’s virtually impossible to evaluate the economic feasibility of the project if we don’t know how much it will cost. That’s why we need to estimate the total cost of the project from its conceptual or pre-construction planning phase.

A conceptual cost estimate refers to the efforts made to predict the cost of a project. Note that the estimated number is only a predicted outcome. By definition, the process of estimating is not exactly a science. Therefore, the accuracy of a conceptual estimate can only be determined after the completion of the project. The preliminary estimate, analogous, feasibility, order of magnitude, and top-down are among some of the most common phrases used to describe conceptual cost estimating.

The Significance of Conceptual Cost Estimates

Conceptual cost estimating is done during the pre-construction stage of the project. The estimate helps the project owner take charge of the overall cost control program − it provides the first check against your budget. A conceptual cost estimate sheds light on potential cost overruns at the early stages, so you will have time to review designs for possible alternatives. Keep in mind that conceptual estimates are made before a detailed design is completed, meaning that you should expect a relatively large margin of error.

The range of accuracy is wider at the initial stages, but it gets smaller as the project progresses and you have a more definitive scope. As the project owner, you should make sure that the design is within the estimated budget. If there are any variations, they should be accompanied by an explanation from the design team as to why that is so. As the project owner, look for a realistic estimate to avoid budget overruns, project cancellations, or re-bids.

Characteristics of Conceptual Cost Estimating

Inexactness, like with any other type of estimating, is the most recognizable characteristic of conceptual cost estimates. With stringent timelines and absence of data, there is probably no other practical method of evaluating design but the use of opinions. The process of conceptual cost estimating combines science and art. While the art visualizes each and every detail of the project, the science of conceptual cost estimating, on the other hand, provides information on the cost of past work.

Information, time, and cost are the main resources for conceptual cost estimating. Based in St. Cloud, MN, Miller Architects & Builders provides a vast array of design and construction services for the area residents. Give us a call if you have any type of construction project that needs a professional touch.