Were other value engineering items discussed?
Yes, so I proposed other options, which the client did not wish to move forward with, for example, I proposed changing the specification of the ironmongery & faceplates throughout the property.
Were other scope reduction items discussed?
Yes, other options which were not approved include
- Reducing the scope of the Audio Visual package by removing the speaker system.
How did you estimate the costs of the VE & Scope reduction items?
For some items, such as the polished plaster to paint change, I had tendered rates for both items. Therefore, I undertook an add & omit exercise for this item.
For other items, I looked to market testing, such as for the change in timber flooring, I reached out to the subcontractor to provide an updated quotation.
When you did the add & omit exercise for the VE options, did you consider any other costs?
Yes, I also included within the saving the OH&P adjustment using the contractor’s tendered rate.
I also adjusted sub-contractor preliminaries in terms of the reduction in stone.
I also considered potential programme savings from the options, however, I felt this was unlikely to be achieved and confirmed this after liaising with the contractor.
How did you ensure things like the timber change were adequate for the client?
Firstly, the timber proposed was one that myself and the architect had used on previous projects, for which we had good experiences.
The architect also ordered samples for the client to approve before moving ahead with any decisions, so the client was very much involved in the process.
You mention that the stone was changed to paint in some parts of the bathroom, how did this not reduce quality?
The stone was still present in wet areas, and therefore, paint to the rest of the bathroom still met the requirements.
Further to this, cost was the client’s main objective in this scenario and therefore it achieved value for the client to make the change.
The negotiated sum was below your PTE, why was this?
In preparing my PTE, I adopted a careful and realistic approach, allowing for remaining design development.
The tenderers were able to price more competitively given the quality and completeness of the information provided, and the competitive tender environment further contributed to returns below my PTE allowances.
You say you did a cost plan 1, and then refer to an OCE?
Referring to the OCE was a mistake.
Why did you advise using a traditional procurement route?
I advised using a traditional procurement route because 2 major requirements of the client were
- they wanted to maintain control of the design . This was going to be their family home so they wanted to have control over this, which in comparison, D&B limits.
I also knew it was highly likely there would be variations for the client altering the specification of things like fittings, which would have been likely to be more costly via a D&B route, as there would not be a detailed CSA.
The second reason was they required cost certainty, using traditional methods allowed us to receive a fixed price before entering into contract, whereas if the design was still being developed with the contractor on board, there would have been less cost certainty.
What are some risks of a 2-stage tender?
No certainty of the final cost.
Contractors may also essentially hide preliminary items with their elemental costs, counteracting some of the positives of defining the preliminaries in the first stage.
For this reason I use a demarkation schedule to confirm what needs to be included for within the preliminaries.
How could you mitigate against issues surrounding preliminary items being incorporated into the measured works?
A demarcation schedule was used to specify what needed to be included within the preliminaries.
With this, there still runs the risk that the contractor will inflate their measured works items, however, we undertook an open book tender to ensure that all correspondence with sub-contractors as well as quotations, were provided.
In addition to this, I market-tested packages with additional subcontractors not on the contractor tender list to provide alternative cost data.
When evaluating the best procurement route for a client, what else did you consider besides time, cost, quality, time & risk?
I also considered other factors such as market conditions,
Size & complexity of the project,
and how progressed the design was
What were your client’s main objectives?
Quality & control of the design as this was their family home and cost
Can you explain to me what you advise your clients on performance bonds?
I always explain to the client what a performance bond is and its benefits and negatives for their consideration.
If I feel the contractor is higher risk I would advise more strongly to use this.
What is non-negligence insurance?
Non-negligence insurance protects property owners from claims arising from damage to neighbouring properties that is not due to the contractor’s negligence. It covers risks like subsidence, collapse, and vibration, even if no one is at fault.
What insurances did you advise the client on?
I advised that option C was required due to the property being existing.
I also advised on professional indemnity, non-negligence, public liability and employers’ liability insurance.
(other - terrorism)
How did your preliminaries compare with the tender?
My preliminaries were approximately 13.5% of the estimate, vs the contractor at 15%.
Whilst we were similar on the weekly rate at 11k vs 10.5k, the contractor had a programme which was shorter than ours, which pushed their overall cost down.
How does A Delta system work?
The vacuum-formed dimpled pattern creates an air gap between the membrane and the foundation, allowing water to drain.
Typically accompanied by channels in the lab to allow for drainage, which a sump pump will remove.
Cost per m2?
£890/m2
How can you minimise design risk in D&B contracts?
Novating design team
How do you manage a 2 stage tender process?
Two-Stage Tender: Stage 1 selects a contractor based on prelims, OH&P, capability and agrees a PCSA.
Stage 2 develops the design with the contractor, obtains subcontract prices, and negotiates an agreed contract sum before entering the main contract.
How can you avoid inflated costs in stage 2 of 2 stage tendering?
Obtain multiple subcontract quotes. Benchmark costs Control scope changes
You state ‘The current Main Contractor marketplace is very busy, and this route is less attractive due to the level of competition and risk.’, why is this?
Routes that involve high competition, fixed pricing, and greater risk transfer are less attractive because contractors must invest significant time and resources tendering with low chances of success
How do you show value in budget?
Value in budget is shown by achieving the required quality and performance within the agreed cost limit, supported by market testing, cost control and risk management.
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Mandatory COPY191
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Contract Administration12
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Random Q&A Practice60
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CONSTRUCTION TECH 142 Q148
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