Glossary
Cost Plan
A cost plan is the consultancy's structured estimate of project cost, developed and refined through the design stages. It sits at the heart of pre-construction commercial work, evolving from order-of-magnitude at Stage 0 to detailed at Stage 4.
How a cost plan develops
Stage 0–1: Order of magnitude — typically £/m² benchmarked against similar projects. A single number, ±20% accuracy.
Stage 2: Elemental cost plan — broken down by element (substructure, frame, envelope, services, etc.). Each element priced against the developing concept design. ±15% accuracy.
Stage 3: Coordinated cost plan — refined elemental, with sub-contractor budget consultation on major packages. ±10% accuracy.
Stage 4: Detailed cost plan / pre-tender estimate — line by line, package by package, ready to convert into tender documents. ±5% accuracy.
Why the cost plan matters
The cost plan is the commercial foundation of the project. The client makes investment decisions on it; the design team makes specification decisions on it; the contractor pricing strategy is shaped by it.
A consultancy that maintains cost-plan discipline — proper structure, regular updates, clear assumptions — produces tenders that come in close to target and projects that finish close to plan. A consultancy that doesn't produces overruns and unhappy clients.
Common pitfalls
- Cost plan structure that doesn't match the design structure. If the cost plan is in NRM2 elemental order but the design is in package order, mapping between them is error-prone. Match structures from the start.
- No record of assumptions. Each line in the cost plan rests on assumptions (specifications, quantities, market rates). If these aren't recorded, the rationale is lost when the assumption changes.
- Cost plan disconnected from PCSR. At Stage 5, the cost plan should evolve into the PCSR. Many consultancies start the PCSR fresh, losing the cost-plan rationale. The PCSR is the cost plan with construction-stage data overlaid.
Related
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