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Regarding the use of Unit Pricing Books such as RS Means which provides pre-priced, construction cost data for estimation purposes -for those you out there that use this method for price comparison in your Construction contracts, do you consider your evaluations to be accurate? What if your Prime is a construction management firm that takes 15% and subcontracts the rest out?

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UPBs can be used to establish a reasonable estimate for comparison, in my experience. Here is a link to understanding RS Means data:

http://www.cmdgroup.com/help/costworks/understanding-rsmeans-data/

I have estimators on the technical side that use pricing guides such as the RS Means. The guide in and of itself seems okay, the problem is usually with the estimator and their ability to estimate quantities or implement a sound estimating process. I can't judge the quality of their estimate per se, but I can judge the process used to build it.

The tool is fine, but the process that implements the tool may not be. For this reason, I prefer competition and find that market prices are usually more indicative of accurate pricing.

At any rate, a Prime using subcontractors still requires a fair and reasonable price...according to the RS Means FAQ website - The prices listed are always the prices of the installing contractor. The installing contractor may be the GC, a contractor or even a sub or sub-subcontractor. Note: each time the costs are passed up the chain of responsibility, a percentage or markup (frequently 10%) is usually added.

Does the contract include either 52.219-14, or 52.236-1?

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The Means Estimating Guide (UPB) is more useful for looking at productivity, crew sizes, types of equipment typically used, etc. than for specific comparisons of estimated cost, without customizing the data. If you are going to use Means to build an estimate for a specific contractor comparison, you must use the local, job applicable labor rates, equipment rates where applicable, subcontractor markups, prime contractor indirect costs and markups, etc. Just using the generic cost information is not adequate for cost or price analysis.

Assuming that you have payroll reports, you can fairly well determine applicable labor rates to plug in. If the contractor and its subs have different equipment than Means used in its crews, you might have to adjust there, too. If you are paying for Stored materials, you can see what materials are costing, if similar materials are to be used.

The Means Estimating Software should allow you to input job specific unit rates as global variables/constants with macros that automatically insert those rate values, into applicable activity formulas. I used to build my own estimates with Lotus 123, using such macros. I could make major revisions to my estimates and objectives in a matter of minutes during negotiations by changing global constants or certain productivities, material costs, indirect rates, etc.

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