CHAPTERONE

 INTRODUCTION

1.1       Background to the Study

Construction estimation is an experience-based process (Elhag et al., 2005).  The code of estimating practice produced by the Chartered Institute of Building (CIOB, 1997) defined estimating as “the technical process or function undertaken to assess and predict the total cost of executing an item(s) of work in a given time using all available project information and resources. Based on this definition, estimators‟ estimated cost is based on the time of construction or project duration, cost of material, method of construction etc. and estimators are aware that most of these factors can be readily estimated. 

The estimators in the construction team are usually the Contractors. The Quantity surveyor as an expert is employed early enough in the project so as to advice the client/Architect on the probable cost implications of the design decisions and to assist in obtaining economical and efficient design (Seeley, 1996) 

However, experts in construction estimation are aware of uncertainty, incompleteness and unknown circumstances of factors affecting cost of construction.  As a result of various studies, several estimating techniques have been exploited and several models

            have     been     developed        (Elinwa           and      Buba    1993;   Elhag   and      Baussabaine,

 1998;Dissanayaka and Kumaraswamy, 1999; Munns and Al-Haimus, 19992000; Ashworth, 2002;Ganiyu and Zubairu, 2010) but the limitation of these techniques and models is that they failto account for the effects of the factors that are more qualitative in nature.

The cost of construction in Nigeria has been reported to be high (Olatunji, 2010), and this has been attributed to several cost determinant variables.Olatunji (2010) reportedthat construction cost in Nigeria are often high and unpredictable and the pattern of the variability is not explained by inflationary indices of common goods and services but rather it is reactive to boom-and-burst shocks that are triggered by the oil price regimes. Elhaget al. (2005) identified and evaluated cost determinant variables within the UK construction industry among Contractors. Prior to the study carried out by Elhaget al. (2005), Okpala and Anekwu (1988) argued that underdeveloped economies tend to exert different influences on construction cost compared to developed economies such as the UK. This has a major impact upon critical determinants of construction tender duration.  Windapo and Iyagba (2007) stated that the Nigerian construction industry need to map out efficient strategy for determining efficient determinants of construction cost in Nigeria, given the peculiar dynamics of the cost of finance. 

 1.2 Statement of the Problem

The identification of cost – determinant variables and evaluation of the degree of influence of these factors on construction cost estimates play an important role in the building up of reliable cost estimates and enhance the competitive edge of Contractors as well as the contracting organization. Elhaget al. (2005) identified and evaluated cost determinant variables to ascertain the degree of their influence on construction cost in the UK construction industry. Although,the research evaluated the degree of influence of some cost determinants variables, the results may not be applicable to the Nigerian Construction industry based on the argument that Nigeria as a developing country has distinct behaviour and should have distinct set of cost determinants that affect construction costs (Okpala and Anekwu, 1988;Windapo and Iyagba, 2007;Olatunji, 2010). Similarly, several other factors not considered by the previous research (Elhaget al., 2005) were also identified by Olatunji(2010).  Olatunji (2010) argued that the oil regime in Nigeria has a way of making the factors affecting sectors in the nation differently than the way it would have normally affected other countries especially developed country. This is because Nigeria’s major source of revenue is from the export of crude oil. This makes the nation’s economy unstable since the nation cannot control the demand of the crude oil. Therefore, although there have been several studies on tender duration  in Nigeria, there has not been any dedicated to outline the critical determinants of construction tender duration.  This is the gap that this study aims to fill. 

            1.3     Research Objectives

The purpose of tender duration estimation is to provide an indication of the probable cost of construction. The estimate will be an important factor in the client’s overall strategy of the decision to build. It will also provide a basis for the clients budgeting and control of the construction cost. The single most important criterion of the estimate is its accuracy (Ashworth, 2002). Thus outlining the critical determinants of construction tender duration will help in building reliable cost models that will help estimators come up with more accurate cost estimates.

1.4 Aim and Objectives of the Study

The aim of the research is to assess the determinants of construction tender duration with the view of articulating the critical determinants.

The following are the objectives;

1.To identify factors affecting construction tender duration in Anambra State

2.To assess the level of significance of factors determining tender duration in Anambra state

3.To articulate the critical factors and eliminate redundant factors

Scope and Limitations

1.5.1 Scope

Construction tender duration has been seen to be influenced by several factors. This research focused on assessing the factors that influence tender duration. This research was limited to Contractors both in public and private practice in Anambra state. The state was chosen as study area because of the massive construction projects going on in the state at the time of the study, thus the presence of a good number of Contractors. Contractors were considered since they play a measure role in the preparation of tenders sum. 

1.5.2 Limitations

This research was limited to Contractors both in public and private practice in Anambra State was chosen because of the massive construction projects going on in the state thus the presence of a good number of Contractors while Contractor were considered since they play a measure role in the preparation of tenders.

This research was limited to the fact that the Contractors that responded were not necessarily registered but were the ones available at the time of research. 

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