• Title/Summary/Keyword: Cost plus fee method

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A Study on Improving Pricing Criteria for Post-Construction Evaluation (건설공사 사후평가 용역대가기준 개선방안)

  • Kim, Seok;Lee, Du-Heon;Park, Jae-Woo
    • The Journal of the Korea Contents Association
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    • v.16 no.8
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    • pp.661-670
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    • 2016
  • In 2000, post-construction evaluation was introduced for the purposes to evaluate demand, cost, and construction period of public construction projects and to reduce errors of public order agencies. However, pricing guide of post-construction evaluation has not been established, which becomes a cause of quality degradation of post-construction service and conflict occurrence. This study suggests the pricing guide in the form of percentage of construction cost method and cost plus fee method based on data of post-construction evaluation. This study investigates the construction costs and service costs for post-construction evaluation and conducts the comparative analysis of 'percentage of construction cost method' and 'cost plus fee method.' The analysis result shows 'cost plus fee method' is more accuracy than 'percentage of construction cost method.' In particular, cost plus fee method includes various correction coefficients, such as distance, area, and integration, in order to reflect the project characteristics of each infrastructure, and suggests linear construction (roads, railways), nonlinear construction I (housing and industry complex), and nonlinear construction II (airports, seaports, dams, water and sewage).

Proposal and Evaluation of the Safety Inspection Cost Estimation Model for Multi-building Construction Project (군집시설물 건설공사의 안전점검 대가 산정모델 제안 및 평가)

  • Kim, Jin-Won;Bang, Jong-Dae;Sohn, Jeong-Rak
    • Journal of the Architectural Institute of Korea Structure & Construction
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    • v.33 no.12
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    • pp.11-18
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    • 2017
  • The safety inspection cost of the construction work was based on commercial facilities classified as a single building. Therefore, it is not possible to fully reflect the characteristics of the multi-building construction project such as apartment houses. Therefore, this study suggests a reasonable estimation model that can fully reflect the characteristics of the multi-building construction project. The safety inspection cost estimation model proposed two models such as construction cost ratio method and cost plus fixed fee method. And these models were simulated by the apartment construction work and compared with the current standard. As a result, the current construction cost ratio method has shown that the safety inspection cost tends to be overestimated as the construction size increases. Therefore, the proposed model has reflected characteristics of the multi-building construction project, so that it can reasonably estimate the safety inspection cost more than the current standard.

An Analysis of the 2014 Pricing Guide for Technical Service Contracts through Comparison with Foreign Countries' Cases (해외사례 비교를 통한 2014년 개정 건설기술용역 대가기준 분석)

  • Lee, Taewon;Lee, Ghang
    • Korean Journal of Construction Engineering and Management
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    • v.16 no.3
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    • pp.152-164
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    • 2015
  • Enhancing clarity and transparency of the pricing guide for technical services for public construction works enables the prediction and reimbursement of the service cost for project owners and bidders, while it would also yield benefits for engineers who carry out the construction tasks. In order to improve the global competitiveness of construction service industry, the government revised its pricing guide for techical services for construction works recently, moving away from its previous percentage-of-construction-cost method towards the Cost Plus a Fee Method. However, since the Cost Plus a Fee Method results in the rise of the service price by 153%~197%, there is the need for a review on the method and basis of the adjustment in order to avoid controversies regarding the application of the revised method. In this context, this paper analysed the 2014 revision of the pricing guide for technical services for public construction works through comparison with foreign cases including those of the US and the UK. The analysis yielded the conclusion that, while the shift towards Cost Plus a Fee Method which is widely used in advanced economies is a very meaningful change in large measure, certain aspects still remain problematic. Unlike in advanced economies, the detailed break-down shows the direct labor cost includes certain indirect expenses. Also, indirec expenses are admitted so comprehensively as to include overhead costs and technology royalties. These problems results in redundant estimation of certain expenses, and obstructs transparency in spending details. This paper proposes various improvement measures to address these issues.

Suggestions for Sustainable Construction Project Management (지속가능한 건설사업관리를 위한 발전방안)

  • Lee, Seung-Hoon
    • Proceedings of the Korean Institute of Building Construction Conference
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    • 2021.11a
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    • pp.240-241
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    • 2021
  • For the sustainable development of the domestic construction project management field, each CM company should try to diversify in terms of service contract types and scope of work while having internationally competitive technical and service capabilities as follows. First, from the initiation of the service to the completion, the CMr should be able to establish and execute a plan to create specific outcomes. Second, CMr must have the capability to produce weekly or monthly cost, schedule, risk, and scope management reports. In addition, it should be possible to apply the cost plus sliding fee method or to systematically and continuously accumulate and process data generated during the construction process.

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The Establishment of Improvement Direction through Case Analysis of Cost Standards in Overseas Construction Engineering (해외 건설엔지니어링분야 대가기준 사례분석을 통한 개선방향 마련)

  • Ko, Hyun A;Han, Jae Goo
    • Proceedings of the Korean Institute of Building Construction Conference
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    • 2020.06a
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    • pp.165-166
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    • 2020
  • The standard for the cost calculation in the field of domestic construction engineering can be largely divided into the construction cost ratio method and the actual cost addition method. However, the standard for calculating the cost of the construction cost ratio method is a trend to switch to the actual cost addition method due to limitations such as not reflecting the characteristics of the construction. Therefore, this study aims to derive implications by investigating and analyzing examples of cost standards in the field of overseas construction engineering, such as the United States, and deriving directions for improvement in domestic cost standards in the future.

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A Study on NOS Model System for The Construction Work Planing and Management (건설 시공 계획 및 관리 업무의 적용을 위한 NOS 모델 구축 연구)

  • Choi, Jaejin;Park, Hongtae
    • Journal of the Society of Disaster Information
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    • v.12 no.1
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    • pp.10-18
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    • 2016
  • This study presented a new NOS model through the following suggestions to apply the construction work planing and management to NOS(Network Operating System). First, This study presented CIMS(construction information classification system) reflected the characteristics of facility classification - functional component classification - functional component classification - work classification - resource classification. Based on this system. this study presented how to establish PMMB(performance measurement management baseline) with proposed master target equation which analyzed the trend of performance measurement management baseline and proposed work target equation which analyzed the execution results. Finally, this study presented NOS model that can be applied to fixed price method and cost plus fee method through the theoretical verification of executive performance analysis method.

A Study on the Factors Affecting the Detailed Design Price of Road Construction Project (국내 도로공사 실시설계 대가영향요인에 관한 연구)

  • Lee, Mi-Young;Seo, Jung-Hoon;Oh, Se-Wook
    • The Journal of the Korea Contents Association
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    • v.18 no.9
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    • pp.44-54
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    • 2018
  • In the construction project, the design field has a crucial effect on the success or failure of the final product, and it is becoming more important as a core area of national industrial development because it creates high value added by technology. In addition, since the design work is carried out based on professional technical personnel, in order to secure the quality and competitiveness of the design, it is necessary to continuously input the excellent manpower and develop the technology, and above all, the appropriate design cost must be ensured. However, as a result of reviewing the current status of the design cost criterion in Korea, problems such as mixed cost calculation method, inaccuracy of construction cost ratio method, and inactivation of cost plus fixed fee method were analyzed. Therefore, it is difficult to calculate the fair value reflecting the characteristics of the project when calculating the construction design price. Therefore, the price criterion should be improved so that the fair value of the design can be determined according to the contents of the project, By analyzing the correlation and multiple regression analysis of the projects and price information of the completed road construction design, the factors influencing the design price and the level of influence were analyzed.

A Benchmarking Study on CM Fee Estimation (해외사례 벤치마킹에 기반한 국내 CM 대가체계 개선 시사점 도출)

  • Kim, Sang-Bum;Lee, Jeong-Dae;Kim, Jae-Wook
    • Korean Journal of Construction Engineering and Management
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    • v.9 no.1
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    • pp.96-106
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    • 2008
  • The Korean Construction Industry significantly contributed to the Korean economic development not only by preparing the domestic infrastructure but also by successfully conducting various international projects. However, major incidents such as the collapse of Sung-Su Bridge and Sam-Pung Department Store along with stagnation of Korean Economy have raised questions about underlying systematic problems of the Korean Construction Industry. As a solution to resurrect the Korean Construction Industry, the Construction Management (CM) system introduced in late 1990's and increasingly utilized as an innovative delivery system. Despite of the fast growth of CM, the performance of CM has not been up to the hype and low CM fee has been identified as one of the main reasons of unsatisfactory CM performance. Therefore, this research attempted to propose ways of improving 'CM Fee Guidelines' published by Korean Ministry of Construction and Transportation by conducting a benchmarking study on Global Standards of estimating CM Fee. International organizations benchmarked in this research include CMAA, ASCE, DOL, DOE, etc. Various investigation and analysis revealed that Korean 'CM Fee Guidelines' need to significantly modified comparing to Global Standards. This research also tried to prepare recommendations to improve the CM deliver system focusing on the 'Method of CM Fee Estimation' and Selection of a CM firm as an owner's agent.

The analysis of the renewable energy supply ratio for the school building applied PV system (PV 시스템이 설치된 대학건물의 전력 생산에 따른 신재생에너지 공급비율 분석)

  • Kang, Su-Hyun;Lee, Yong-Ho;Hwang, Jung-Ha;Cho, Young-Hum
    • Journal of the Korean Solar Energy Society
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    • v.32 no.2
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    • pp.50-57
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    • 2012
  • Recently the renewable energy has been used widely and the importance of renewable sources is bigger than before. And the government enforced a law to the public buildings to install the renewable energy facilities. The capacity of facilities was 5% of total construction cost until April 13, 2011. Since then, the government changed the law from 5% of total construction cost to 10% of predicted energy usage for the resonable use of the renewable energy facilities. In this study, the comparative analysis is conducted according to the law to the building installed PV system through the Energy Plus simulation. And the method for improving renewable energy supply ratio was analyzed using existing PV array. Adjusting the PV array angle is the best way to generate more electric power without additional fee. When applying the month optimum angle, 3,600kWh of electric power are more generated compared to the existing angle.

A Rating Method for the Estimation of the Additional Overhead Expenses incurred by Schedule Extension in Public Construction Projects (공공건설공사의 공기연장에 따른 추가간접비 산출을 위한 요율방식 제안)

  • Lee, Seung-Joon;Cha, Yongwoon;Han, Sangwon;Hyun, Chang-Taek
    • Korean Journal of Construction Engineering and Management
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    • v.22 no.3
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    • pp.79-90
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    • 2021
  • In domestic public construction, disputes are increasing due to differences among stakeholders regarding contract price adjustment. In particular, the actual cost-plus fee for overhead costs due to the schedule extension cannot be agreed upon at the administrative phase, and most of them seek judicial judgment. Thus, this study aims to propose a 'sufficiently satisfactory' alternative to reach an agreement before disputes in order to minimize disputes related to the calculation of additional overhead costs. To this end, this study proposes three alternatives based on the rate method. Firstly, when calculating additional overhead costs, it is not calculated as an actual cost-plus-fee method, but as a rate compared to direct labor costs among net direct costs. Secondly, the calculated indirect labor costs are compensated for up to the legal maximum of legal limit costs such as general management costs, profits and so on. Thirdly, it reflects overhead costs increased or decreased due to change orders. Risks were analyzed by collecting expert opinions on the proposed methods and applying actual cases. Finally, as a result of investigating the level of consensus for each stakeholder, it was confirmed that all stakeholders could agree regardless of the size of the company. The result of this study is expected to as a useful tool among stakeholders in the construction fields that can be able to easily agreed upon.