How to build a pricing schedule: structure, coding and completion rules

A pricing schedule is built by starting from the structure of the project and cutting it into economically coherent units. Three principles govern that work.

• Principle 1, one package equals one contract equals one contractor. The first decision is how to split the works into packages. Each package corresponds to a trade or to a coherent grouping of work that will go to a single contractor. The number of packages depends on the size of the project: a scheme of three dwellings may have eight, a scheme of fifty will have twelve to eighteen.

• Principle 2, granularity governs control. The breakdown into sub-packages has to follow the real phases of execution on site. If the foundations are poured in three weeks and the frame takes eight, they belong in separate sub-packages so that the monthly valuations reflect real progress.

• Principle 3, the description must be verifiable. Every line has to describe an item precisely enough for the contract administrator to check on site whether it has actually been carried out. "Sundry concrete" cannot be verified. "Reinforced concrete walls, 200 mm thick, formwork both faces, C25/30 concrete" can.

For a standard residential or office scheme, the twelve packages below cover every trade. The budget weightings shown are ranges for a standard apartment building; they vary with the brief and the region.

The concrete frame is invariably the heaviest package, 20 to 30 % of the works budget. It is also the one whose breakdown into sub-packages matters most: foundations, superstructure and slabs run at very different speeds and must be separated if the financial control is to be reliable.

The table below shows a blank schedule structured for the concrete frame. The quantity, rate and total columns are left empty for the contractor to fill in with its own figures.

A professional description always contains four elements: the nature of the item (wall, slab, window, duct), its main technical characteristics (thickness, section, material, strength class), the conditions of execution where they are unusual (single-sided formwork, face fixing, headroom below 2,20 m), and what the price includes (supply and fix, removal of waste, cleaning).

• Concrete frame: square metres for walls and slabs, linear metres for beams and columns, cubic metres for excavation, numbers for precast elements.

• Roof structure and covering: square metres on plan for the covering, linear metres for ridges and verges, numbers for dormers and rooflights.

• Façades and external insulation: square metres of developed area, watching the rules for deducting openings, which vary by trade.

• External joinery: numbers, with a complete description including the dimensions, never square metres.

• Partitions and ceilings: square metres of net area fixed, with openings deducted according to the technical standards.

• Electrical and mechanical: a combination of linear metres for the runs, numbers for the equipment and items for complete installations.

ℹ Lump sums: when to use them and when not to The "item" or "lump sum" unit is acceptable where the content is clearly defined and the quantity is fixed: a stair of 14 risers is one item, a boiler house installation is one item. It is to be avoided on significant items whose content varies or whose scope could be contested. A "concrete frame, lump sum, 250 000 €" is an invitation to litigation. A lump sum should never exceed 15 % of a package without further breakdown.

The numbering of the pricing schedule must be strictly consistent with that of the priced bill; that is what makes line-by-line comparison possible at tender assessment. The standard convention is dotted hierarchical numbering, XX.YY.ZZ, where XX is the package number, YY the sub-package and ZZ the individual item within the sub-package.

Package and sub-package headings carry no price; they are structural lines with no total. Only the item lines carry quantities and prices.

The link between the pricing schedule and the monthly valuations is the most practical reason for structuring the schedule properly at the outset. Each month the contractor submits a valuation stating the percentage complete of each sub-package. The contract administrator verifies that progress on site, confirms or corrects it, and calculates the payment due.

If the frame is broken into four sub-packages, foundations, superstructure, slabs, sundries, the monthly control is precise: in month two, foundations at 100 %, superstructure at 40 %, slabs at nil. If the schedule is a single line reading "concrete frame, lump sum, 280 000 €", progress can only be assessed globally and subjectively, which is a standing source of disagreement.

A pricing schedule is built on three principles: one package equals one contract, granularity governs control, and every description must be verifiable. The standard twelve-package structure covers every trade on a residential or office scheme. The right granularity is four to seven sub-packages on each significant package, with item lines whose descriptions carry four elements: nature, characteristics, conditions of execution and what the price includes. The hierarchical coding must match the priced bill exactly so that the two can be compared at tender. The most serious mistake is a package reduced to a single line: monthly control becomes impossible and the final account ends in dispute.

The nature of the figures quoted

The percentages and amounts quoted on this page are orders of magnitude for framing, not measurements. They illustrate mechanisms and proportions, and they substitute neither for a tender exercise nor for an estimate prepared on drawings.

• Priced bill, pricing schedule, specification: the three documents explained
• How to structure a technical specification: standard plan, requirements and pitfalls
• How to build a tender comparison schedule: columns, weightings and reporting
• Variations and disputes on site: securing the final account