Open AccessConstruction price assessment method based on inferential statistics
Author(s) -
L. Remek,
J. Mikolaj,
L. Mikulova,
M. Durinova
Publication year - 2021
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/1015/1/012061
Subject(s) - negotiation , leverage (statistics) , population , actuarial science , order (exchange) , reimbursement , process (computing) , economics , operations research , business , computer science , finance , engineering , law , health care , demography , political science , economic growth , machine learning , operating system , sociology
The paper presents a new objective price assessment method that can be used to accept, reject or negotiate prices for construction works proposed by the contractor of construction works. The method can be used as part of an acquisition of a new construction and in claim negotiation process both in private or a public sector. Price assessment is an investor‘s tool for the assessment of price eligibility. It should be focussed on evaluation of direct construction costs and indirect costs of the contractor in order to establish whether the costs declared by the contractor are justified. This creates a negotiation leverage in the creation of a contract or creation of legal basis for negotiations regarding claim reimbursement which can be recognized in accordance with special contractual provisions. Price assessment is a very time consuming task, the presented method uses statistical tools to assess the contractor’s price proposal by detailed analysis of main items on the budget, which are then treated as a population sample. Population mean of difference in contractor prices and price catalogue prices are then used to establish a confidence interval which can be used for hypothesis testing, i.e. drawing conclusions and further negotiations.