CHARGES FOR ESTIMATES.

Press, Volume LIX, Issue 17939, 6 December 1923, Page 5

CHARGES FOR ESTIMATES.

INCREASED BUILDING COSTS

Millions of dollars in building construction are wasted annually in New York alone- through the competitive bidding system, according to L. K. Cornstock, who addressed the New York Building Congress recently. Every time an architect or a builder makes an expensive estimate on a. job and loses he charges it up to "overhead." Bay by day, said Mr Comstock, there is being built up here in New York and elsewhere an overhead charge which sooner or later must be added to succeeding estimates or bring about bankruptcy. Where they are reflected in future estimates then the overhead charge becomes a charge on the industry as a whole. As a solution for the evil, Mr Comstock suggested a charge for estimates commensurate with the cost of making them which if fairly well established would bring about a reduction in the number of estimates desired by the owner or others acting on his behalf.

Owner Pays an Unknown Bill. • In justification of this charge, 'Mr Comstock explained, the owner would pay only for the estimates prepared for his building, whereas under present conditions lie not only pays for the estimates applicable to his own building, but also a share of the cost of the estimates for eighty or ninety other buildings out of every 100 his contractors didn't get. In other words, the owner pays an unrendered bill but doesn't know it. "What the building industry needs today in order to reduce its building costs," he said, "is a correction of the competitive system now in vogue. Certain definite studies of the cost of estimates plus the selling effort expended on them reveal the fact that for every million dollars worth of building construction in New York City 30,300 dollars is expended by contractors and subcontractors in bidding and estimating before construction can begin. "During 1922 the value of building construction for which plans were filed with the Building Department was 577,894,081 dollars. If only 60 per cent, of this valuation was actually constructed there would bo imposed on the industry correspondingly an overhead charge for estimating of 10,506,113 dollars before any construction work can begin. The figures are tentative, but it is believed that they understate tho case. These figures indicate that the loading of the industry for estimating is approximately 3 per cent., yet it is probable that the charge more nearly approximates 3| or 4 per cent. Thau this charge is unwarranted is obvious, and its partial or complete elimination is the problem."

Committee Considered Problem. "In conclusion, Mr Comstock recommended to the memters of the New York Building Congress the establishment of a Quantity Survey Bureau in the New York Congress for the building industry, which would provide more definite and reliable quantity information as a basis of estimates than those prepared by the general run of contractors, and in addition competing contractors' would be able to present bids which at least sire comparable.

Waste in estimating now going on in the building industry, which has been, and is, a detriment to craftsmanship, quality, and service, has been considered by the Survey Committee of th? Building Congress, «nd they have prepared a. bulletin giving information on the elimination of wasfe in bidding and estimating. This bulletin will be circulated widely among the Congress membership. In addition, the executive committee of the Congress will undoubtedly appoint a committee to go into the matter of eliminating waste and recommend a solution of the problem.