BUILDERS’ COSTS AND ESTIMATES.

Progress, Volume XV, Issue 7, 1 March 1920, Page 741

BUILDERS’ COSTS AND ESTIMATES.

By R. A. DERRICK

I (0) (Continued from February issue.) In)

The three subdivisions now dealt, —"C,"

“F,” and “G” cover fairly well-all the work likely to be met with in costing the carpenters’ work in ordinary villa construction. Other carpenters’ cost * units may have to be added. Thus many builders will need cost units for roof principals, fixing roof purlins, and similar work. Others again may find it useful to have cost units for work such as fixing shingles, and for fixing special wall finishes, and ■ so on. Each builder should design his cost units to suit his own particular type of business, and contracting and estimating methods.. The foregoing will give a good idea of the manner in which this may be done for carpenters’ work. There yet remain subdivisions “B” and “L”— bricklayer’s and labourer’s work. These may be subdivided into cost units somewhat as follows: Subdivision “B” —Bricklayers’ Work. Walls, etc.:—B W B—“ Bagging” walls; BAV C —Chimneys work; B AV llnside walls; B AV K Striking work ; B W L—Sleeper walls; B AV O—Outside walls; AV W S — Special walls. General Work: —B G C — Coppers and Flues; B G FSetting Frames; B G SSetting sills and ' stonework. Old Work:—B E Making good old work; B O B—Pulling down old work. Sundries:—B P R—Building piers; B S R—Work on special arches. • ' , Other cost units might include cornices, elaborate chimneys, and ornamental work generally. Cleaning down the work is often sublet to a special tradesman such as the tuekpointer, who would do the work at a price for both labour and material. This work is therefore not included in the bricklayers’ work. As a sub-contract this work is still a cost unit of course. Subdivision , “L”—Labourers’ Work. Digging Work: D FDigging foundations L D Digging post holes. Concrete Work:— C F— Conefeteing foundations L C H — Concreting hearths L C Preparing reinforcing rods; L C —Cohcreteing in form work. ■ , > Bricklayers’ Work:— B Mixing mortar; LB K—Hod carrying of bricks and motor; L B S Scaffolding. . ■ • > __ *; . A - t General-Work and Assisting:—LAC—Assisting carpenters; L A S—Stacking timber; L A U—Unloading materials; L P DPulling down old work; L K. G—Clearing ground for building; L K U Cleaning up after the work. «

From such! a, subdivision of the labourer’s time it is possible to accurately determine such costs as that or excavation, per cubic yarn; mixing and placing concrete per cubic yard; and also tJtie value of sucii overhead charges as scatfolding and care and maintenance of plant. An accurate knowledge of such costs is a rare thing among builders, though most men in the business make use of some ligures that they have obtained from somewhereeitheir from casual observation or from other sourcesin estimating.' Withf this system guess-work in these matters is eliminated, accurate figures of real costs being easily acquired and applied when using cost units. PART IV. Of course, the work previously describedthe division of the job to be done into convenient sections or cost units—is merely preliminary, and is of itself of limited* value. It must be followed up by measures designed to secure costs of materials and labour as promptly as possible; and again, by provision for the tabulation of the figures made available in this way. To commence at the beginning of things, the first thing to be attended to is the system of ordering goods. Many contractors grow very lax in this respect, and trust implicitly to foremen and others, ins is all very well —sometimes—but if you adopt the accurate , methods necessitated by a good cost system, you have got to adopt them completely and not in part only. It is well to say at the outset that all orders must go through a central Order Book, kept at the builders’ office. Should any material be wanted urgently, on short notice, so that it would mean delay to put it through the office, then the person authorised to act under these circumstances must clearly understand that a copy of the order must go to the office immediately, unmistakeably marked “Ordered” or “Delivered” as the ease may be, to prevent duplication. • . . Everything purchased or taken from stock for contracts must go' through the order book, or 4 order books. If there is no onice centrally situated, and each contract is worked on its own basis, then there should be ah order' book for each contractwhich is the same thing, only in sections. Often there is a separate book for goods taken from stock. The next point is, each order should be given a Reference Number. When ordering, the builder should state clearly the order number, place for delivery and so on. He should also insist that the firm delivering the goods quote the order number (abbreviated O/n) on the Invoices for the goods. This is, of course, usual practice among first-class business houses, but it may cause a little trouble at first to get builders supply houses to do it. .If the order number is specified on the invoice it is an easy matter, and the work of a moment, to compare the goods sent with those ordered, and to determine for what contract and for what cost unit they were purchased, etc., etc. All these facts are shown in the order book when properly kept, and if an estimate or an invoice pro forma, t

has been secured before hand, it should also be noted in the order book, so that the price may be* checked up against the nistimate when tne proper time arrives.

it is ox course desirable to maKe a further check of orders ana invoices against delivery dockets; but cms can easily be arranged, and is; not an essential part of the cost system per se because everyone ougnt to do it any way.

An ordinary "Day Book" such as is used in most tradesmen's snops, is ail that is necessary for an order booK, and it will 'be found to pay for itself many times over in a tew months, in time saved and in general convenience for reference etc. There should be a column for order number and date, and in the centre of the page the book should state from whom the goods are ordered, where they are to be sent, for winch contract and for 1 - which subdivision they are to be used (.using the mnemonic symbols), and it should also state when delivery is wanted or promised. In this way 'the contractor has ail of Jiis buying under his hand, through the order book. He also has a good check on any ordering done by his foreman.

The next thing is —get invoices promptly from merchants, from whom you are buying. With many smaller timber yards and merchants it is the practice to wait till the end of the month, and then furnish a detailed statement to the customer. That system may save the merchant a little trouble—though that is very much open to questionbut it' often means that the buiideir receives, on or about the 6th of the month following delivery of the goods, a sheaf of invoices of great bulk, and even though his intentions are good, he has neither time nor inclination to wade through them all and properly check them against orders and correct the extensions —and he has therefore to be content with a more or less cursory examination. This cannot be justified under any circumstances, and as a matter of fact good business piractice demands that an invoice be 'furnished at the same time as the consignment of goods is sent out. Again this is the usual thing with first class business houses, who also know, that it saves their own time as,well as being the just right of the customer.

Just here it might be objected that many orders are so small that they do not warrant a special invoice, and that merchants will refuse to supply the invoices. It is admitted that there are many convenience lines" that must be purchased in small quantities and on short notice, which do not warrant an invoice to themselves these do not materially affect costs, even if invoices are not received. At the same time, three considerations must, be borne in mind. The first is, that it is good buying piractice to stick to one or two good firms or supply houses, and not to spread purchases in small amounts over a large number of merchants, even though a small' apparent saving may be thereby made. It is far better to be a worth-while customer to one or two good firms than a small and unconsidered buyer from a dozen. The result of the former policy is better attention; and better prices, and more considerate treatment in time of difficulty (which nearly everyone experiences at some time or other). The second con-

. .. . V -- sideration is that, where there is a great deal of this small buying, it is well to look into the matter and ; find out if time and money could not be saved by buying some of these small sundries in bulk and j cairrying them in stock. The third consideration is ' that, if frequent small purchases are after all necessary, it is always possible to arrange for the supply of weekly invoices instead of daily ones, and this compromise will prove satisfactory to both merchant and customer. , - If invoices are regularly received as soon as possible after the delivery of the goods, and if they are promptly marked with the order numbers, the contractor has to his hand information that will enable him to determine his cost of materials accurately and quickly, without waiting till the accumulation of invoices and other papers is such as to cause him to shrink from the task of reducing them to orderly costs—which will .almost inevitably be the ease if the work, is left till the end of the month. He also has these cost figures at the time that they are of some, value to him'—and not a month later. PART V. Having made provision , for prompt costs of materials, the next thing - demanding attention is that all-important itemLabour. It will be desir—though not absolutely necessaryto secure labour' costs in terms of the cost unit system built up in previous articles of this series. It is not absolutely necessary to do this, because it is quite possible to estimate and take out costs by making the whole of the carpenter’s labour one cost unit. This method is, of course, not recom- . mended for any but the smallest jobs, for it quite fails to take advantage of many of the facts made available by the cost system; and.even for small jobs it is best to adopt a uniform system, in order that uniform methods of estimating may be used and checked up. It is not difficult to obtain unit labour costs. As stated when discussing “cost units,” these should follow (as well as possible) the order in which work is carried out on the job. If this aim has been attained, it is possible to make use of a subdivided time sheet for example, a separate time sheet for each of the main subdivisions of work. This would .mean three time sheets for the carpenters, one for framing, one for finishing, and one for general work. Of course, not all three would be in use at once. Framing and finishing are not usually running at the same time on the same job-sunless the framing is a small job such as a shed, etc., which would be better done while the remainder of the framing is in progress anyway. Bricklayers and labourers would require only one sheet each. These time, sheets might be known and referred to by the distinguishing symbol of the subdivision. Thus, -for framing work, the carpenters would use sheet “C,” and on this sheet would be printed all the cost units given in that‘subdivision, with provi- . sion for hours -and minutes, after each. Such sheets require very little labour on the part of the work-

man, who simply fills in how his day has been spent opposite the possible forms of work upon which he could have been engaged. There should be provision for special items not covered by the time sheet, and these items should be watched carefully, for they will be seldom estimated for. Often, however, the use of one of these spare lines will save the use of two time sheets, where a little time has. been spent on another subdivision. Subdivided time sheets may be either daily or weekly. For a contracting business of any consequence, daily time sheets are easily the best. That may sound a startling statement, but it has been proven time and time again. A daily sheet from each man employed saves lots of time in the long run, if accurate costs are aimed at. Each man fills in his time sheet (perhaps “time slip” more accurately describes it, for it should be small enough to fit into an ordinary envelope without folding), and hands it to the foreman before leaving the work at night. The foreman then checks it up and initials it while the facts of the case are fresh in his mind, and sends the whole of the sheets for his job to the office. If the office is at a distance, he posts the job sheets in one envelope. The weekly cost is perhaps sixpence, and it saves shillings in labour and convenience. When the office receives these sheets they are counted and checked up to see that all are there, then recorded in the weekly pay roll. From this roll the men’s time is made up, and they are paidaccordingly on pay-day. It is each workman’s own responsibility to see that his foreman gets , a time sheet each evening, and if he does not do this he finds his money short at the end of the week. If the office find that they have to make back entries for men’s time, they draw attention to the fact that ■ the men in question are not sending in their sheets promptly, and take action accordingly. After the sheets have been entered in total on the weekly pay roll, they are sorted into subdivisions (for each contract), and everything is then ready for posting into the cost records. This is not a laborious work, and when it is completed (perhaps in the early part of the morning, if done regularly and, promptly) there are available, accurate unit labour costs for the job in question; up to the previous evening. Thus the labour costs are only a few hours behind the work, and if any action is necessary, the information is available at a time when something can be done, not when the matter is past history. , As each item on the time slip is posted into the cost record under its right heading or cost unit, a little tick is made beside the man’s entry, to show that it is done with, and when the sheet is finished, it is crossed and filed. It may be kept for a week or so, in case any discussion arises concerning the amount of money the man has received.as wages, or concerning the men who were employed on a certain piece of work which has cost too much or which has s come out exceptionally well. The sheets may then be destroyed. ' ' (To be continued)