How to Manage Construction Cost Breakdowns With McCormick

It’s no secret that in the commercial construction industry, the difference between a winning bid and a lost opportunity often comes down to the clarity and accuracy of your cost analysis.

Every dollar counts and according to a study by Navigant Construction Forum, the average cost of rework is 9% of total project costs when accounting for indirect factors like lost productivity and delays.

This staggering statistic underscores the high financial risk that contractors face from inaccurate bids and poor cost management

That’s where McCormick Systems truly shines, offering powerful tools that transform complex project data into crystal-clear insights.

At McCormick, we understand that providing a lump-sum bid isn’t always enough.

You need to see the intricate web of costs that make up a project, from labor hours on the first floor to material expenses in a specific system.

Our software is designed to peel back the layers of your estimates, showing you detailed construction cost breakdowns which gives you an unparalleled view of where your money is going.

Key Takeaways for MEP Commercial Construction Estimators:

• McCormick’s bid summaries and breakout reports help estimators move beyond a single lump-sum price, providing a clear, detailed view of costs broken down by floors, systems or phases.
• By automatically updating the bid summary with any changes made to a specific breakout, the software eliminates manual errors and ensures your final bid is always based on the most current data.
• The ability to easily segment and analyze costs allows estimators to quickly identify areas for optimization, helping to fine-tune bids for maximum competitiveness and a healthier profit margin.
• Detailed reports provide financial insights into different project segments, empowering estimators to better track progress, manage resources and make data-driven decisions throughout the project lifecycle.

The Power of Granular Cost Visibility

Imagine you’re bidding on a multi-story commercial building, a project teeming with intricate mechanical, electrical and plumbing systems.

Without a detailed breakdown, managing costs across different floors, systems or phases can feel like navigating a maze blindfolded.

This is precisely why McCormick’s bid summaries and breakout reports are not just features; they are essential tools for any MEP estimators aiming for precision and profitability.

Our software empowers you to segment your projects into manageable, logical parts.

Whether you’re tracking the costs associated with the plumbing system on the third floor or the electrical wiring in the west wing,

McCormick provides the framework to do so with ease while removing the risks associated with manual estimating.

This granular visibility helps you identify cost-saving opportunities, flag potential overruns early and ultimately, improve your construction bids.

How Bid Summaries Break Costs Down

McCormick’s bid summaries serve as the comprehensive financial blueprint for your projects.

They consolidate all the estimated costs, giving you a top-level view while still allowing you to drill down into the specifics.

This isn’t just a basic cost sheet; it’s a dynamic summary that integrates every aspect of your commercial estimate, from material suppliers and labor to overhead and profit margins.

It provides a snapshot of total estimated costs, clearly laying out the various components that contribute to the final price.

Additionally, these summaries are incredibly flexible. You can adjust profit margins, overhead percentages and other key financial drivers directly within the summary, instantly seeing the impact on your final bid.

With a well-structured bid summary, you can instantly grasp the overall financial health of your project.

Diving Deeper With Breakout Reports

While bid summaries aggregate total project costs, breakout reports segment those costs by specific parameters (floors, systems, phases, custom categories).

This is where the true “deep dive” happens, allowing you to evaluate your project costs by various parameters.

Think of it as having X-ray vision into your estimate, revealing the financial specifics of every single component.

Breakouts enable you to categorize your project by:

• Floors or Areas: See the exact costs associated with each level of a building or distinct zones within a project.
• Systems: Understand the individual cost contributions of electrical systems, plumbing networks, boiler installations and more.
• Phases: Track costs as they align with different construction phases, from rough-in to finishing.
• Custom Labels: Create your own categories to segment costs in a way that makes the most sense for your unique workflow or project requirements.

For example, a project manager could generate a breakout report to specifically analyze the labor costs for the plumbing system on the second floor during the rough-in phase.

This level of detail simplifies your estimating is crucial for effective resource allocation, progress tracking and identifying inefficiencies before they escalate into major problems.

It shifts you from reactive problem-solving to proactive cost management.

Unlocking Project Clarity With Integrated Breakouts

One of the key features of our software lies in how breakouts seamlessly connect to the bid summary.

When estimators adjust quantities in a floor breakout, McCormick’s integrated system automatically recalculates and updates the master bid summary, eliminating manual data entry errors and ensuring bid accuracy.

This interconnectedness eliminates the risk of estimating mistakes and ensures that your overall bid summary always reflects the most current and accurate cost data.

Furthermore, our advanced capabilities allow you to easily combine and split costs directly within the bid summary by various parameters.

You can break out the bid summary by floor to see associated overhead, profit and job costs for each level. You can also analyze labor rates and direct/indirect expenses for specific building sections.

This sophisticated level of organization transforms how you track and analyze project finances, helps you build an estimating reputation and stay on top of the intricate details while maintaining a clear view of the overall project structure.

A Summary of Bid Summaries

Leveraging McCormick’s bid summaries and breakout reports fundamentally changes how you approach construction estimating.

It’s about moving from approximation to precision, from guesswork to informed decision-making. By gaining this deep level of clarity into your costs, you can:

• Improve Bid Accuracy: With every cost meticulously accounted for and categorized, your bids become more precise and less prone to costly errors.
• Identify Cost-Saving Opportunities: Detailed breakouts help pinpoint areas where costs might be higher than anticipated, allowing you to explore alternatives or negotiate better pricing.
• Enhance Project Management: Understanding cost distribution by phase or system enables better resource allocation and progress monitoring throughout the project lifecycle.
• Increase Profitability: Ultimately, more accurate and optimized estimates translate directly into healthier profit margins for your business.

In today’s competitive construction landscape, having a robust estimating solution isn’t just a convenience, it’s a necessity.

McCormick Systems provides the tools to not only manage construction cost breakdowns but to understand your project costs in a way that empowers you to bid smarter, manage more effectively and consistently drive profitability.

Talk to a McCormick specialist today to learn more!