Assemblies: The Foundation of ALL Estimating Software

There's a little insider's secret to estimating programs that you NEED to be aware of. Today's newsletter is going to share that secret AND show you how to get all of your ducks in a row so that when you buy your estimating software you can put it to use almost immediately.

They Really Don't Like Me Much
Every time I attend a construction conference, the same thing keeps happening to me on the show floor.

A contractor, after learning what I do, asks me for my opinion about some estimating software being pitched at the show. I walk with him to the booth and start asking the salesman questions about his estimating package.

As the questions progress, the salesman starts getting more and more flustered. Why?

The salesman (or woman) doesn't look too kindly towards me when I show their prospects that a HUGE amount of time and effort are involved PRIOR to using the estimating software productively. At that point, the salesman almost always loses the sale.

That's why they end up hating me.

Assemblies: The Secret to Easy, Fast, & Accurate Estimating
Buried deep down, at the beginning point of all decent estimating packages, lies the unit cost assembly. All estimating packages offer them and most rely on them.

Not familiar with unit cost assemblies? No problem. First an explanation then an example to clear up the picture.

A unit cost assembly includes all labor and materials needed to perform a single unit of construction work. The unit might be a brick, a linear foot, a square foot, a cubic yard, or a pound.

All the estimator has to do is plug in the number of units, multiply units by the cost per unit, and the assembly drops out the total cost, the total material requirements, and the total man-hours required to perform the work.

Slick, eh?

Okay, An Example
Let's assume Ed the Estimator works for a carpentry contractor. He often has to estimate the cost of building 9' tall, steel stud, gyp walls. To save time, he has built an assembly per linear foot to cost out such walls.

Fred's wall assembly would capture the cost of labor, material, and equipment. The assembly would show the unit costs of each component and its ratio of units per linear foot.

Fred's cost of building one linear foot of 9' tall, steel stud, gyp wall is $11.584. Thus, a 10' long wall would cost $115.84 to build and take 3.6 man-hours. A 13' long wall would cost $150.59 to build and take 4.7 man-hours.

Got it? Simple right?

Easily Adjust for Changing Component Cost
One of the biggest advantages of using assemblies is that you can easily and accurately adjust your unit costs for changes in material or equipment component prices. You can similarly adjust for changing worker performance.

For example, if the price of drywall climbed to $6.00 per sheet, the unit price would increase to $12.184/LF.

The assembly makes the adjustment automatically.

Now let's look at how easy it is to adjust for changing labor productivities. What would be the impact of the framing crew's productivity slipping by 15%?

The crew would require 0.188 hr / LF, which corresponds to 0.16 hr/ LF divided by 0.85. The cost would now be $3.76 / LF for the framing labor and the total assembly price would be $12.14 / LF.