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The Cost Planning Process
The cost planning process consists essentially of three phases:
The first of these involves the establishment of a realistic first estimate (Preliminary Approximate Estimate)
The second stage plans how this estimate should be spent among the various parts or elements of the project (Cost Plan)
The final stage is a checking process to ensure that the actual design details for the various elements can be constructed within the cost plan (Cost Checking)
The cost planning process commences with the preparation of an approximate estimate by the quantity surveyor, and then the setting of cost targets, which are based upon elements. As the design evolves these cost targets are checked for any under-or-overspending against the architect's details. The prudent quantity surveyor will also always be looking for ways of simplifying the details, without altering the design, in an attempt to reduce the tender sum. Cost planning over the last decade is increasingly becoming a valuable service that the client is expecting from the quantity surveyor, to ensure that he receives better value-for-money, expenditure is controlled, and that the project cost is kept within the agreed budget. To undertake this service effectively it is necessary for the quantity surveyor to be appointed at the earliest possible stage, in order to make positive contribution at the brief and feasibility stages. It attempts to keep the designer fully informed of all the cost implication of the design.
The various stages of Cost Planning during the design & construction phases is shown in the diagram below
