A new approach to construction item pricing

David Cattell

A new approach to construction item pricing

David Cattell

Centre for Comparative Construction Research

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review

Abstract

The competition for work between contractors is largely determined by lump sum prices for whole projects. However, most project contracts are instead governed by the unit prices for each of the project components. These item prices are more difficult for clients to assess. Translated, this means that contractors have considerable scope within which to decide their prices without effecting their competitiveness and without being noticeable by clients. Research on mathematically optimising these prices started 50 years ago but this has so-far failed to address the risks involved, despite widespread acknowledgement that these risks are considerable. A new component unit pricing (CUP) theory has now been developed that has identified and assessed these risks. This gives contractors prospect by which to decide prices that are in accord with the market – by which they can not only earn more profits but avoid risks as well.

Original language	English
Title of host publication	Proceedings of the Construction, Building and Real Estate Conference, Las Vegas, Nevada USA, 11-13 September 2012
Editors	D Kashiwagi, K Sullivan
Place of Publication	Tempe, Arizona
Publisher	Arizona State University
Pages	535-543
Number of pages	9
ISBN (Print)	9781842198407
Publication status	Published - 2012
Event	Construction, Building and Real Estate Conference: COBRA 2012 - Las Vegas, Nevada, United States Duration: 11 Sept 2012 → 13 Sept 2012

Conference

Conference	Construction, Building and Real Estate Conference
Country/Territory	United States
City	Nevada
Period	11/09/12 → 13/09/12

3 Conference contribution

Benchmarking public private partnership environments: East Asian comparisons
Regan, M., Smith, J. & Love, P., 2012, Proceedings of the Construction, Building and Real Estate Conference. Kashiwagi, D. & Sullivan, K. (eds.). Arizona State University, p. 1716-1723 8 p.
Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review
Forecasting supply of commercial office buildings using polynomial distributed lag model
Sing, C., Love, P. E. D., Wang, X. & Smith, J., 2012, Proceedings of the Construction, Building and Real Estate Conference. Kashiwagi, D. & Sullivan, K. (eds.). Tempe, Arizona : Arizona State University, p. 1353-1360 8 p.
Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review
Review and analysis of the residential building certification process in South East Queensland
Smith, B., Mitchell, G. & Smith, J., 2012, Proceedings of the Construction, Building and Real Estate Conference, Las Vegas, Nevada USA, 11-13 September 2012.. Kashiwagi, D. & Sullivan, K. (eds.). United States : Arizona State University, p. 174-181 8 p.
Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review

Cite this

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title = "A new approach to construction item pricing",

abstract = "The competition for work between contractors is largely determined by lump sum prices for whole projects. However, most project contracts are instead governed by the unit prices for each of the project components. These item prices are more difficult for clients to assess. Translated, this means that contractors have considerable scope within which to decide their prices without effecting their competitiveness and without being noticeable by clients. Research on mathematically optimising these prices started 50 years ago but this has so-far failed to address the risks involved, despite widespread acknowledgement that these risks are considerable. A new component unit pricing (CUP) theory has now been developed that has identified and assessed these risks. This gives contractors prospect by which to decide prices that are in accord with the market – by which they can not only earn more profits but avoid risks as well.",

author = "David Cattell",

year = "2012",

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pages = "535--543",

editor = "D Kashiwagi and K Sullivan",

booktitle = "Proceedings of the Construction, Building and Real Estate Conference, Las Vegas, Nevada USA, 11-13 September 2012",

publisher = "Arizona State University",

address = "United States",

note = "Construction, Building and Real Estate Conference : COBRA 2012 ; Conference date: 11-09-2012 Through 13-09-2012",

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A new approach to construction item pricing. / Cattell, David.
Proceedings of the Construction, Building and Real Estate Conference, Las Vegas, Nevada USA, 11-13 September 2012. ed. / D Kashiwagi; K Sullivan. Tempe, Arizona: Arizona State University, 2012. p. 535-543.

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › Research › peer-review

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N2 - The competition for work between contractors is largely determined by lump sum prices for whole projects. However, most project contracts are instead governed by the unit prices for each of the project components. These item prices are more difficult for clients to assess. Translated, this means that contractors have considerable scope within which to decide their prices without effecting their competitiveness and without being noticeable by clients. Research on mathematically optimising these prices started 50 years ago but this has so-far failed to address the risks involved, despite widespread acknowledgement that these risks are considerable. A new component unit pricing (CUP) theory has now been developed that has identified and assessed these risks. This gives contractors prospect by which to decide prices that are in accord with the market – by which they can not only earn more profits but avoid risks as well.

AB - The competition for work between contractors is largely determined by lump sum prices for whole projects. However, most project contracts are instead governed by the unit prices for each of the project components. These item prices are more difficult for clients to assess. Translated, this means that contractors have considerable scope within which to decide their prices without effecting their competitiveness and without being noticeable by clients. Research on mathematically optimising these prices started 50 years ago but this has so-far failed to address the risks involved, despite widespread acknowledgement that these risks are considerable. A new component unit pricing (CUP) theory has now been developed that has identified and assessed these risks. This gives contractors prospect by which to decide prices that are in accord with the market – by which they can not only earn more profits but avoid risks as well.

M3 - Conference contribution

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BT - Proceedings of the Construction, Building and Real Estate Conference, Las Vegas, Nevada USA, 11-13 September 2012

A2 - Kashiwagi, D

A2 - Sullivan, K

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CY - Tempe, Arizona

T2 - Construction, Building and Real Estate Conference

Y2 - 11 September 2012 through 13 September 2012

ER -

A new approach to construction item pricing

Abstract

Conference

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Related Research Outputs

Benchmarking public private partnership environments: East Asian comparisons

Forecasting supply of commercial office buildings using polynomial distributed lag model

Review and analysis of the residential building certification process in South East Queensland

Cite this