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Understanding QicWorks Cost Management

03.08.20 06:00 AM By Karen Parker

QicGuide Series: Resource, Materials & Pricing Tables

Cost, time and resource estimates are used as the basis to control your jobs and to standardise your cost comparisons between estimated and actual. 


All project or job lifecycles start with your estimate. But in order to construct your estimate we first need to look at what is being estimated against for each job, task or work group ie Work Breakdown Structure. We need to consider what resources are required, the cost for those resources and the duration they are required for.

To make estimating and cost tracking easier it is recommended that estimators and project managers are aware of the following QicWorks terminology and practices.

Classifications
QicWorks uses Classifications to group together common resource types. Classifications are not the individual Resource names, instead it is the group in which to Resource will be costed by. Classifications are used to calculate the net cost and billable rates for each of your resources. Examples include Boilermaker Level 2, Supervisor, or 5T Truck.

Important! QicWorks allows you to add equipment as either a Material or as a Resource. It just comes down to how you wish to charge the equipment out and/or if you wish to schedule time for the item within QicWorks Job Schedule.

Resources
Resources are visible for planning and cost tracking within QicWorks schedule, rosters, timesheets and shift reports. Resource billable rates are set by no charge or hourly rates only.

Resources are the individual names of the items within your labour and/or equipment pool. Resources need to be assigned a Classification to capture their net cost and billable rates. QicWorks allows labour to be assigned a Classification either within Staff or Resource Tables. Equipment is classified within the Resource Table only.

Example:

Resource = John Smith > Classification = Boilermaker Level2
Resource = Barry Jones > Classification = Boilermaker Level2

Resource = Toyota AB12CD > Classification = 5T Truck
Resource = Hino FF23GG > Classification = 5T Truck

QicWorks goes one step further by allowing you to collect and report costs of your resource based on their Resource Type. Choose to report on:

Direct costs – such as labour, materials, equipment, or tools specifically allocated to the job. These items represent real cash overflows and must be paid as the job progresses.

Indirect costs – such as office overheads, utilities, general administration staff or project managers. Indirect costs are items that are unable to be charged direct to the client as part of the job.

Sub Contractor – Use this category to collect costs associated directly with subcontractor hire.

Equipment – such as equipment items you have purchased or hire for a specific job.

Materials
Materials are tangible goods that are purchased to be resold/billable to the customer or consumed on a job. The easiest way to determine if something is a material is to think of materials as a quantity of item multiplied by costs. Materials can not be planned or scheduled within QicWorks Job Schedule unless they are set as a Job Milestone.

A Materials Net Cost is set by each and its Billable Rate is by no charge, each, once, hourly, daily, weekly or monthly.

Tracking your costs and billable rates is easy with QicWorks. We have simplified the process by allocating the rates based on classification. Assign the correct billable rates table to your Job and behind the scenes algorithms will then automatically collate and calculate your costs and billable values to date.

Net Cost Table
The Net Cost Table shows your buy costs for all Classifications and Materials. These values are used to calculate the Actual cost of your jobs.

Important! You must make each Classification and Material active within the Net Cost Table for it to be seen throughout QicWorks.

All items within the Net Cost Table that are marked as Active are automatically added to the Base Billing Rates Table as Active. They will also appear in any additional Billing Rates Tables you may have customised for your customers, sites or projects, but will be marked as Inactive. You will need to activate and edit their values, within the specific Billing Rates Table, as applicable.

Billing Rates Tables
Every QicWorks account has a default Base Table. This Table is automatically populated with the names of your Classifications and Materials, as created within the Net Cost Table. You will need to then enter the specific rate values as applicable.

Additional Billing Rates Tables can then be created either by cloning the Base Table or applying a Pricing Level. (A Pricing level is a percentage uplift or discount that is applied to the Base Table.)

Individual Billing Rates Tables can be created to reflect specific Customer, Site or Projects. These tables are used to set the sell rates for each Classification and Material assigned to that Job. These rates are also used to calculate the Billable value of that Job.

Remember cost management all comes back to your estimates and if your estimate costs are not based on time, then you will have no real way of measuring performance.

QicWorks is a business management solution that has been designed to manage complex rate structures, across multiple entities and worksites, all from the one account. QicWorks provides accurate real time field data giving you the confidence to make the right decisions. Contact us today to see how QicWorks can transform how you do business.



The information contained within this blog is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own situation and legislative requirements before making any decisions


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