CPCCBC5005A Assessment 4: Managing Subcontractors - Part 2 & 3

This project, based on the CPCCBC5005A course, focuses on subcontractor selection and management within a construction context. Part 2 involves evaluating and comparing subcontract quotations from various companies (Ultimate Concrete Services, Professional Formwork, Quality Concreting, and P&W Concreting) against an original tender budget to select the most cost-effective and timely subcontractor for concrete and formwork. The analysis considers factors like total budget, duration, and excluded items to determine the best choice. Part 3 delves into managing subcontractors, including a pre-award interview template to assess potential subcontractors, selection criteria and a template, a communication process, and a performance management procedure with templates. The project covers how to handle poor performance, record overall performance, and items to be explained during site inductions. The document provides a comprehensive guide to the practical aspects of subcontractor management in construction projects.

Assessment 4: Part 2&3 1
ASSESSMENT 4: PART 2 & 3
Name
Course
Professor
University
City/state
Date

Assessment 4: Part 2&3 2
Table of Contents
1. Part 2: Select Subcontractors...........................................................................................................3
1.1. Original tender budget and subcontract quotations...............................................................3
1.1.1. Original tender budget for concrete and formwork........................................................3
1.1.2. Ultimate Concrete Services Pty Ltd..................................................................................3
1.1.3. Professional Formwork and Concreting Services Pty Ltd..............................................4
1.1.4. Quality Concreting Pty Ltd...............................................................................................5
1.1.5. P&W Concreting Services Pty Ltd...................................................................................6
1.2. Evaluating and comparing the subcontract quotations..........................................................7
2. Part 3: Manage Subcontractors........................................................................................................8
2.1. Subcontractor pre-award interview template..........................................................................8
2.2. Procedure and template for selecting new subcontractors...................................................10
2.2.1. Selection criteria..............................................................................................................10
2.2.2. Selection template............................................................................................................11
2.2.3. Information gathering.....................................................................................................12
2.3. Communication process..........................................................................................................12
2.4. Procedure and template for performance management of subcontractors.........................13
2.4.1. How to deal with poor subcontractor performance......................................................13
2.4.2. How to record, evaluate and summarize overall subcontractor performance............15
2.5. Items to be explained at the site induction of contractors.....................................................16
References................................................................................................................................................18

Assessment 4: Part 2&3 3
1. Part 2: Select Subcontractors
This task involves evaluating and comparing subcontract quotations that have been submitted by
four different subcontractors so as to select the most cost and time effective subcontractor for the
concrete and formwork trade. The subcontract quotations are compared with the original tender
budget for the trade.
1.1. Original tender budget and subcontract quotations
1.1.1. Original tender budget for concrete and formwork
The estimated original budget of the concrete and formwork is calculated as follows:
Total concretor trade budget = $483,157
Builder’s site O/H costs = $2,000/day x 65 days = $130,000
Total original budget = $483,157 + $130,000 = $613,157
1.1.2. Ultimate Concrete Services Pty Ltd
The following assumptions apply: a total of 12 pumps will be needed for the concrete works;
normal daily working hours are 8; and all works will be done during normal hours.
Total cost of supply, place and finish reinforcement and concrete work = $305,520
Total formwork needed = 1,994m2
Cost of formwork needed = $92/m2 x 1,994m2 = $183,448
Cost of extra pumps needed = 4 (12-8) pumps x $750/pump = $3,000
Cost of labour = 70 days x 8 hours/day x $68/hour = $38,080
O/H costs = 70 days x $2,000/day = $140,000

Assessment 4: Part 2&3 4
Cost of liquidated damages = 5 (70-65) days x $4,500/day = $22,500
Total budget = $305,520 + $183,448 + $3,000 + $38,080 + $140,000 + $22,500 = $692,548
However, Ultimate Concrete Services Pty Ltd has excluded the following items (which will be
provided by the builder) in its budget estimation: all the necessary change, lunch and toilet
facilities; all hoisting facilities with the exception of those needed for placing concrete; and
concrete surfaces curing.
1.1.3. Professional Formwork and Concreting Services Pty Ltd
The following assumptions apply: a total of 12 pumps will be needed for the concrete works;
normal daily working hours are 8; and all works will be done during normal hours.
Cost of concrete testing = $8/m3 x 527m3 = $4,216
Cost of place and finish concrete slabs = $48/m3 x 527m3 = $25,296
Cost of set up concrete pumps = 12 pumps x $500/pump = $6,000
Cost of termite control = $6/m2 x 684m2 = $4,104
Cost of supply and place 50mm sand blinding = $4.30/m2 x 684m2 = $2,941.20
Cost of place membrane = $7/m2 x 684m2 = $4,788
Cost of supply, place and strip formwork = $110/m2 x 1310m2 = $144,100
Cost of labour = 53 days x 8 hours/day x $70/hour = $29,680
O/H costs = 53 days x $2,000/day = $106,000
The subcontractor will complete the work ahead of time hence no liquidated damages

Assessment 4: Part 2&3 5
Total budget = $4,216 + $25,296 + $6,000 + $4,104 + $2,941.20 + $4,788 + $144,100 + $29,680
+ $106,000 = $327,125.20
However, Professional Formwork and Concreting Services Pty Ltd has excluded the following
items (which will be provided by the builder) in its budget estimation: supply of concrete;
concrete curing; finish 50mm sand blinding; supply membrane; supply and place steel
reinforcement; and supply of workers’ shed accommodation.
1.1.4. Quality Concreting Pty Ltd
The following assumptions apply: a total of 12 pumps will be needed for the concrete works;
normal daily working hours are 8; and all works will be done during normal hours.
Cost of formwork = $115,800
Cost of supply, place and finish concrete = $305,400
Cost of extra pumps = 4 (12-8) pumps x $750/pump = $3,000
Cost of labour = 70 days x 8 hours/day x $75/hour = $42,000
O/H costs = 70 days x $2,000/day = $140,000
Cost of liquidated damages = 5 (70-65) days x $4,500/day = $22,500
Total budget = $115,800 + $305,400 + $3,000 + $42,000 + $140,000 + $22,500
= $628,700
However, Quality Concreting Pty Ltd has excluded the following items (which will be provided
by the builder) in its budget estimation: testing of concrete; curing of concrete; hoisting facilities;
sand blinding; control of termite; Fortecon slab underway/membrane; and removal of rubbish.

Assessment 4: Part 2&3 6
1.1.5. P&W Concreting Services Pty Ltd
The following assumptions apply: a total of 12 pumps will be needed for the concrete works;
normal daily working hours are 8; all works will be done during normal hours; and no work after
4pm or on weekends.
Cost of supply, place and strip class 2 suspended formwork = $95/m2 x 1,310m2 = $124,450
Reinforcement needed
If 0.15tonnes of steel reinforcement is needed per m3, therefore steel reinforcement needed for
527m3 is:
0.15t/m3 x 527m3 = 79.05t
Cost of supply and place steel reinforcement = $2,200/t x 79.05t = $173,910
Cost of supply, place and finish 32MPa concrete = $198/m3 x 527m3 = $104,346
Cost of labour = 72 days x 8 hours/day x $67/hour = $38,592
O/H costs = 72 days x $2,000/day = $144,000
Cost of liquidated damages = 7 (72-65) days x $4,500/day = $31,500
Total budget = $124,450 + $173,910 + $104,346 + $38,592 + $144,000 + $31,500 = $616,798
However, P&W Concreting Services Pty Ltd has excluded the following items (which will be
provided by the builder) in its budget estimation: supply of Fortecon membrane; concrete testing;
concrete curing; hoisting facilities; rubbish removal; and supply of workers sheds.

Assessment 4: Part 2&3 7
1.2. Evaluating and comparing the subcontract quotations
Table 1 below shows the summary of total budget, duration and excluded items for the builder
and the four subcontractors.
Table 1: Summary of total budget, duration and excluded items
Name of subcontractor Total
budget
Duration Excluded items
Builder $613,157 65 days - None
Ultimate Concrete Services Pty
Ltd
$692,548 70 days - All the necessary change, lunch
and toilet facilities
- All hoisting facilities with the
exception of those needed for
placing concrete
- Concrete surfaces curing
Professional Formwork and
Concreting Services Pty Ltd
$327,125.20 53 days - Supply of concrete
- Concrete curing
- Finish 50mm sand blinding
- Supply membrane
- Supply and place steel
reinforcement
- Supply of workers’ shed
accommodation.
Quality Concreting Pty Ltd $628,700 70 days - Testing of concrete
- Curing of concrete
- Hoisting facilities
- Sand blinding
- Control of termite
- Fortecon slab
underway/membrane
- Removal of rubbish
P&W Concreting Services Pty
Ltd
$616,798 72 days - Supply of Fortecon membrane
- Concrete testing
- Concrete curing
- Hoisting facilities
- Rubbish removal
- Supply of workers sheds.

Assessment 4: Part 2&3 8
From Table 1 above, each subcontractor has a different total budget and duration.
Professional Formwork and Concreting Services Pty Ltd has the lowest budget and the shortest
duration but has the highest number of items excluded. In fact all subcontractors will complete
the work late (will take more than 65 days estimated by the builder) except Professional
Formwork and Concreting Services Pty Ltd that will complete the work 12 days earlier. Ultimate
Concrete Services Pty Ltd has the highest budget followed by Quality Concreting Pty Ltd and
both have excluded some items and will complete the work in 70 days, which is behind schedule.
P&W Concreting Services Pty Ltd has a budget that is close to the builder’s budget but the
subcontractor will take the longest time to complete the work (7 days behind schedule).
Since it is assumed that all activities programmed are on the critical path, it is important
to choose the subcontractor that will complete the work as scheduled or earlier. Even by
estimating the cost of the excluded items based on prices from the builder’s budget, Professional
Formwork and Concreting Services Pty Ltd still has the lowest total budget. Therefore the
builder should select Professional Formwork and Concreting Services Pty Ltd. Nevertheless, the
builder should put in place measures to ensure that the materials and services excluded by
Professional Formwork and Concreting Services Pty Ltd are obtained and provided on time.
Using Professional Formwork and Concreting Services Pty Ltd means that the work will be
completed in 53 days (12 days earlier than the builder’s schedule) and this will help in
completing the whole project earlier and save some costs.
2. Part 3: Manage Subcontractors
2.1. Subcontractor pre-award interview template
The template below contains a series of questions that can be asked during a pre-award interview
when assessing and comparing the suitability and merits of lowest tenderers

Assessment 4: Part 2&3 9
Subcontractor Pre-award Interview Questions
1. Have you understood all the general and special conditions of the subcontract?
2. Do you have the necessary regulatory licenses, permits and insurance cover for the work?
3. For how many years have you been working as a subcontractor?
4. What is the size of your team (full-time and part-time)?
5. Can you increase your team with ease when asked to?
6. Has your company completed similar projects in the past?
7. How many projects is your company working on at present?
8. What is your company’s approximate annual revenue?
9. What type and number of plant/equipment do you have?
10. Do you have the necessary tools, plant and equipment for this subcontract?
11. Can you complete the work within the stipulated schedule?
12. How do you ensure that you comply with the necessary code of practice?
13. Do you have a safety and health plan?
14. Do you have a quality assurance policy and/or plan?
15. What pricing method did you use to estimate the budget?
16. Do you have any unresolved dispute with your clients?
17. If awarded this subcontract, can you start working immediately?
18. Can you work overtime and on weekends or public holidays?
19. What plans do you have to complete the work on time or early?
20. What are your company’s payment conditions?
21. Do you have any innovative products and services?
22. Do you have any authorized parties that can sign documents or agreements on your behalf?
Signed by:
Builder/representative: ………………………………………………. Date: …………………..
Subcontractor/representative: ………………………………………… Date: …………………..

Assessment 4: Part 2&3 10
2.2. Procedure and template for selecting new subcontractors
2.2.1. Selection criteria
The following are some of the important requirements to consider when selecting a new
subcontractor:
Certification: the subcontractor must have the required certificates as a proof that it meets
the necessary industry qualifications (Abbasianjahromi, et al., 2013).
Personnel: the subcontractor must have adequate staffs with the right qualifications for
the work.
Plant & equipment: the subcontractor must have the necessary tools, plant and equipment
for the work, either by ownership or leasing.
Experience: subcontractors with several years of experience on similar projects have a
competitive advantage because they understand the challenges of the industry (Marzouk, et al.,
2013).
Reputation: subcontractors with a good reputation should be considered because it is an
indication that do their work professionally and are after building good relationships with other
stakeholders.
Financial records: subcontractors with solid financial history should be preferred instead
of those that are almost becoming bankrupt.
Workload: the subcontractor should not be working on several projects currently, which
could affect its concentration on the subcontract.

Assessment 4: Part 2&3 11
Safety: the subcontractor should have a safety plan that minimizes potential risks/hazards,
damages, injuries and fatalities on site.
Quality assurance: the subcontractor should have a quality assurance policy and plan to
ensure that work done meets the required quality standards.
Ethics: the subcontractor should also be ready to work in accordance with the relevant
professional code of ethics.
Values: the subcontractor’s operations should also be guided by appropriate values such
as accountability, transparency, integrity and sustainability, among others.
Exceptionality: it is also important to consider the uniqueness or innovativeness of the
subcontractor in terms of construction materials and methods that save time and cost and
promote sustainability.
2.2.2. Selection template
Subcontractors can be evaluated using Pugh matrix that awards scores to each element in the
selection criteria. The contract is awarded to the subcontractor that gets the highest awarded
score. Table 2 below is a template that can be used for subcontractor evaluation and selection
Criteria Total
score
Awarded
score
Comments
Certification 5
Personnel 5
Plant & equipment 5
Experience 5
Reputation 5
Financial records 5
Workload 5
Safety 5
Quality assurance 5
Ethics 5
Values 5

Assessment 4: Part 2&3 12
Exceptionality 5
Total 60
2.2.3. Information gathering
Information about different elements and/or characteristics of the subcontractors can be
obtained from the subcontractor’s websites, incorporation or registration documents, licenses,
certifications, awards, annual reports, financial records, project award letters, project completion
and handover certificates, project payment certificates, recommendation letters, testimonials, and
social media pages. The information can also be gathered from relevant financial institutions,
government agencies and professional bodies.
2.3. Communication process
Communication plays a key role in successful completion of construction projects (Akintan &
Morledge, 2013). Below are several communication methods that subcontractors can adopt and
use in this project:
Phone calls: subcontractors can use mobile phones to call different stakeholders and share
information related to the project.
Meetings: the subcontractors can hold meetings physically on site or through video
conferencing or teleconferencing.
Electronic: the main electronic method that subcontractors can use is emails. The method
allows sharing of texts, reports, drawings and photos.
Printed methods: this includes sharing information through letters, minutes, financial
records and reports.