INNOVATION OF SETTING BID PRICES OF BUILDING IN THE CONSTRUCTION COMPANY - PARAMETRIC BUDGETING
DOI:
https://doi.org/10.51704/cjce.2018.vol4.iss1.pp107-115Keywords:
Price, offered price, parametric budget estimation, conventional budget estimation, innovation, maximum allowed deviation, cash flowAbstract
This article describes a procedural innovation for the determination of offered prices within a construction company – parametric budget estimation. The author is focused on the general way of offered price generation in construction companies in the Czech Republic and on the innovation of this procedure for the purpose of improving its efficiency. Parametric budget estimation is a method of qualified estimations of the offered price for an object construction. Parametric budget estimation is based on price estimation models, defining price behaviour (equations) and price levels (coefficients), for a certain type of construction. Any construction object should be defined by its parameters. The offered price defined by parametric budget estimation in a construction company has a pre-defined accuracy based on a maximum allowed deviation. The author describes the method of setting the maximum allowed deviation. The author describes the incorporation of maximum allowed deviation into a simple cash flow innovation.
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