Contract Cost and Price Analysis Training Course

Participants can assess the completeness and credibility of a supplier cost breakdown.

• Direct labour, materials, subcontracting and other direct cost categories
• Cost breakdown structures linking proposal values to supporting source data
• Traceability tests from summary schedules to invoices, timesheets and quotations
• Classifying fixed, variable, semi-variable and step costs within proposals
• Detecting double counting between direct costs, overheads and contingencies
• Cost-driver trees connecting operational volumes to supplier expenditure patterns

Participants can test labour estimates, charge-out rates and productivity assumptions.

• Labour-rate build-ups separating wages, benefits, payroll burdens and overhead
• Benchmarking skill grades against market surveys and comparable contracts
• Productivity estimates tested through work breakdown structures and output rates
• Learning curves applied to repetitive production and service delivery tasks
• Overtime, shift premiums and utilisation assumptions challenged with evidence
• Validating proposed hours against scope, staffing plans and delivery schedules

Participants can evaluate material and subcontract costs using credible market evidence.

• Material quotations compared by specification, quantity, delivery and payment terms
• Bill of materials analysis identifying quantity, waste and yield assumptions
• Subcontractor pass-through costs reviewed for competition and markup treatment
• Commodity indices tested against actual purchase categories and contract timing
• Make-or-buy assumptions assessed through capacity, capability and cost evidence
• Supply market benchmarks adjusted for geography, volume and technical specification

Participants can assess indirect cost allocations, profit expectations and risk allowances.

• Overhead pools allocated using labour hours, machine hours or revenue bases
• General and administrative expenses separated from project-specific indirect costs
• Allocation bases tested for causality, consistency and materiality
• Profit analysis considering risk, capital employed and competitive conditions
• Contingency allowances challenged through risk registers and probability estimates
• Fee structures compared across fixed-price, cost-reimbursable and incentive contracts

Participants can apply price analysis methods when detailed supplier cost data is unavailable.

• Historical-price analysis normalised for scope, quantity, inflation and performance
• Competitive quotation comparison adjusted for bid compliance and commercial terms
• Parametric estimating using unit rates, ratios and statistical relationships
• Published price lists evaluated for discounts, rebates and transaction conditions
• Market testing methods selected according to data availability and procurement risk
• Triangulating benchmarks to establish a defensible price reasonableness range

Participants can build a should-cost estimate that supports target pricing and negotiations.

• Clean-sheet models built from process steps, resource rates and volumes
• Work breakdown structures translated into labour, material and equipment requirements
• Costed bills of quantity prepared for construction and capital procurement
• Sensitivity analysis testing volume, productivity, exchange-rate and commodity scenarios
• Range estimates expressed through low, expected and high cost cases
• Model assumptions documented for review, negotiation and subsequent update

Participants can compare commercial options using total cost and risk-adjusted pricing analysis.

• Total cost of ownership including acquisition, operation, maintenance and disposal
• Lifecycle cost models comparing supplier offers beyond initial purchase price
• Fixed-price, time-and-materials and cost-reimbursable contract risk allocation
• Incentive mechanisms aligned with cost, schedule, quality and performance outcomes
• Payment schedules assessed for working-capital exposure and delivery assurance
• Break-even analysis comparing alternative sourcing and pricing structures

Participants can evaluate price adjustments and negotiate evidence-based contract changes.

• Escalation clauses linked to appropriate labour, commodity and inflation indices
• Indexation formulas tested for base dates, lags, weights and caps
• Foreign-exchange adjustments assessed through currency exposure and hedging evidence
• Change-order pricing separated into scope growth, disruption and acceleration costs
• Open-book contract data reviewed for variations, claims and renewal negotiations
• Reopener clauses designed around measurable triggers and verification rights

Participants can present a defensible pricing position and plan its use in live procurements.

• Negotiation objectives built from target price, walk-away point and concessions
• Supplier challenge questions linked to specific cost and price evidence
• Fact-based negotiation agendas sequencing high-value assumptions and commercial trade-offs
• Price-analysis memoranda recording methods, sources, adjustments and conclusions
• Audit trails preserving calculations, approvals, supplier data and confidentiality controls
• Application plans assigning analysis actions to upcoming sourcing and contract decisions