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Construction Project Bidding Prices and Price Control Mechanism

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Abstract. In the 21st century, especially after the accession to WTO, construction project bidding price formation mechanism is the main characteristics of the market price of the Construction project is divided in a unified, uniform measurement unit, unified in terms of engineering and consumption of fixed rules on the basis of the implementation of market, competition fees.The first to be carried out not only the financial decision-making, corporate contractors in accordance with the different ways, according to market conditions, its technology, economic strength, through the financial decision-making self-quotation. Second, it is necessary to exercise effective control, both the Construction project bidding price by the form of the contract price is fixed.By design, material procurement, construction management on the implementation of bidding for the effective control of prices.

Key words: Construction project bidding prices, Price control mechanism.

1. The preamble of the production

Project construction central task is to realize the project goals. From the objective sense, investment to achieve the goal of economic benefit is owner real embodiment, And project cost determination and investment of effective control of the engineering construction management is an important and indispensable part of project management has a special position. As China's economic system reform, the national economy continues to develop, how to strengthen the engineering cost management, improve the project investment benefit? This is what the current investment and cost reform a major issue.

Investment cost is a critical part of and main content, it includes the construction project from construction preparatory to completion acceptance of the cost of combined, and it consists of building the cost, equipment tools is, the engineering construction other fees, reserve, interest interest, tax for fixed assets investment and the current funds and so on a composition. The price mechanism is the core of cost management in the problem, but also investment macro decision and improves the project investment benefit of a central issue. To strengthen the cost management, increase the investment effects, must form a under the state's macroeconomic control, taking market mainly formed cost price mechanism.

Especially after China's accession to the WTO, overseas Construction project contracting companies to enter China's market, and our engineering contracting business to compete, and our country's engineering contracting companies also want to work abroad on construction and development market. Therefore, we want to sum up the past domestic and international contracted Construction projects of construction management experience and lessons, and fully understand the Construction project bidding price formation mechanism in the characteristics and operation rules, and effective Construction project cost control, better use of resources, both to open up the market , improve the economic efficiency of enterprises.

2. Construction project bidding price formation mechanism

Contracted Construction projects in the calculation of the Tender Offer to use our decision-making theory, accounting, economics theory quotation evaluation strategy, the Administration on from, the technical and business on a comprehensive identification, compared the use of scientific methodology and practical pricing based on Construction project cost reasonable so that it won the bid quotation.

(1)The current Construction project cost pricing

Based on the characteristics of Not meet the conditions of market economy, international and domestic contract under the tender offer job. China's construction enterprises rarely have their own fixed construction budget, which Construction projects to the international contractor the tender offer must work more difficult.Our country because of the current Construction project cost management system are planned economy mode at the set up, to the neglect of the economic status of an independent enterprise, the State directly involved in management activities, formulate and control constitute a direct Construction project cost of a variety of factors.Although in recent years, various types of engineering consulting companies have emerged, construction Construction projects competitive bidding, Construction project management system, but at pricing based on Construction project cost, the fixed, remain the standard admission fee by the Government to develop, manage, and as a statutory price. Therefore, in Construction project cost management, light decision-making, re-implemented, light economy, emphasis on technical change in the situation difficult.

(2)Under market economy conditions bidding the Construction project in accordance with the characteristics of pricing

In the market economy, be able to timely and accurate market prices to capture information Construction project owners and contractors are to maintain a competitive advantage, control costs and to obtain the key to profitability is the Construction project bidding Price calculation and an important basis for settlement.Price should be gradually liberalized by the fixed pricing method to transition to the market by transition, with the international market. Enterprises according to their skill level personnel, equipment, management capabilities, qualifications, experience and credibility of the development of social enterprises scale their own standards and access charges.

Therefore, we would also like to increase the existing cost based pricing reform Construction projects in the uniform division of the units of measurement unity, unity in terms of work and consumption of fixed rules on the basis of the commodity economy to follow the rules set up to market price Lord of the price mechanism. That is, volume and price to implement the separation of the property to change the fixed price, fixed no longer part of the legal acts, but the amount should be unified, to the country under the guidance of the relevant professional associations, consulting firms or the development of engineering calculation and consumption of fixed rules, to promote fair competition in the market to maintain a balanced development of social productive forces.A specific Construction project at the tender offer when calculating the change in accordance with market supply and demand, government and community advisory body to provide information and the cost price index, quality, and contracting methods, contract period, factors such as the purchase price payment, in accordance with international practices, norms and practices of a flexible self-quotation.

3. Engineering, bidding the price of effective control

In the construction process works there is always risk factors, there is the risk of market price changes, design risk, the risk of material procurement, construction risk management and so on, until the completion of the Construction project, qualified acceptance, Construction project, quality guarantee full recovery, personnel, construction machinery base security to withdraw or transfer to another Construction project site, the risk of the Construction project before finally disappearing. Therefore the works will not be bidding to do a good job of risk control, and Construction project bidding prices, it is particularly important to effective control.

(1)Financial decision-making carried out

Financial decision-making is the production and management and financial management of an important part are from a financial point of business decision-making program on the evaluation and selection. Tender in the international prices in order to work there is profit to be successful and have to adapt to market economy accompanied by the financial mechanism.

Its main mission is to provide dynamic information of enterprise fund, paying close attention to changes in the market, a forward-prediction analysis, the Tender Offer for businesses to provide basis for decision making. Traditional accounting billing management style after the pattern of thought, making the current budget system will have been contracted Construction projects of great importance to the installation of building cost management, while ignoring the cost of the entire Construction project management, do not attach importance to the overall effectiveness of the optimization of modern management can not prediction that the first thought, after thought and methods of control into the system.

After the accounting-based budget management system will not prevent and solve decision-making and the design phase, resulting in a waste and fishing Construction projects, it can not prevent and resolve equipment and materials in the custody of the price of procurement issues, the quality of questions and issues such as inventory. Overview of budget management can not be fixed, both B to the fixed work-based, mutual communication, understanding and left at a loss on the standard scale, superior management, the audit department and arbitral bodies are fixed as the standards of evaluation, This is a static control of the investment.

But also with the adoption of the implementation plan, standards, selection of construction machinery, engineering, etc. to pay the purchase price of the combination of analysis of the tender price, to make the financial decision-making, which is a micro-management. Therefore, we should "control" based on the advance in the tender offer is necessary to take the initiative to adopt the financial decision-making, so that a combination of technical and economic control of Construction project cost to ensure the successful and profitable.

(2)According to the actual situation favorable contract price using the form

Therefore, in a market economy, Construction project bidding is not just a pricing problem, but to design documents, the terms of the contract, text management and bidding are combined. After the end of the Construction project bidding, the price of formed through the form of the contract price is fixed. Contract management through the implementation of bidding for the effective control of prices.Economic contracts between legal persons are to achieve the economic goals must clear the rights and obligations of mutual agreement. Signed a contract business is not just an economic activity, but also a legal act, is to use legal means and a combination of economic instruments to manage the economy as a measure.For larger multi-year Construction projects or incomplete design documents, engineering, traffic engineering can not be fixed, unit price contracts can be used. We can also set forth in the contract prices and adjust the scope of price adjustment formula, and so on in order to reduce the risk.Contract price and payment terms of the economy are one of the core provisions of the contract, the contract negotiations, signing, implementation, management in an important position. So bidding for the contract price set, the weight can change over the past progress and quality control, cost control in light of the idea. For the year started, when the completion of the engineering, design departments, construction companies, material supply department in accordance with their respective contractors, use of fixed price lump sum contract price of a packet die from start to finish.

(3)Designed to implement limit

For a Construction project, investment in its construction phase involves the design, material procurement and construction management of three areas. The quality of investment Construction projects, the level of Construction project cost, play a decisive role is to design. Engineering design stage is the formation of the first phase of the Construction project price, at this stage investment opportunities to save many, the amount of large, small price to pay.The quality of the Construction project construction period, the Construction project features, Construction project life and Construction project return on investment at the design stage and so to the cost of technology and investment form. Budget management over the current emphasis is often placed on the construction phase of the construction cost management, while ignoring the design stage and material cost of the procurement phase of management, a budget ultra-budget, ultra-budget settlement is inevitable phenomenon.In the Construction project bidding system, the characteristics of engineering design work are technical decisions of economic, technical economic constraints, thus enabling us to do a good job in Construction project bidding price limits effective control must be designed not only to achieve the design of the scale, design standards, design depth, engineering quantity and amount of investment and other aspects of effective control.

(4)Improve material procurement management system, step by step with the market.

Building at the installation, the materials about the Construction project costs Jian'an around 70%. At the installation, the equipment also account for a large proportion. Therefore affect the bidding price is another factor material procurement management system. To really make the market price mechanism for the formation of the effective operation, it is necessary to have the materials suited to the procurement management system.

Economic conditions in the market, whether the owners or contractors material procurement, or quotation in the tender should be stipulated in the contract variety, quantity, quality, price limits the scope of the implementation of procurement, efforts to reduce the equipment and materials costs. For instance, the implementation rate of procurement management, it is necessary to shop around, the purchase price can not be higher than the budget price, cost price; the other would also like to set up and perfect the internal procurement audit system, the implementation of the decision-making power, the implementation of the right to examine the right of separation of powers, and so on, in order to effectively control the Construction project cost.

(5)Claim works bidding price controls are another important job

Construction project bidding price controls are another feature of the Construction project claims management. Claim contracts are legal and legitimate right to give, we should establish a sense of Claim,Claim importance, good claims, set up a sound mechanism for claims management.Contractor should give full play to the initiative, not wait until the loss of another way to think, but to claim as an important way to improve economic efficiency, in the case before they happen to consider measures to be taken at the time of going ahead, and actively take the initiative to study use and ways to control risk. Statute of limitations in the claim, the Claim in accordance with the procedures, according to reliable evidence, the reasons put forward claims and claim the contents of documents for the claim is reported.

4. Conclusion

To sum up, economic conditions in the market, bidding the Construction project is a systematic Construction project, involving every aspect of the price formation mechanism has the inherent characteristics and operation rules, so we want according to their characteristics and operation rules, and seriously prepare Price bidding for engineering calculation and control, enhance competitiveness, it is necessary to ensure the successful, but also to ensure that economic benefits must be able to obtain.

References

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[2] Rashmi Malhotra,D.K.Malhotra.Differentiation between Good Credits and Bad Credits Using Neuro-Fuzzy Systems[J].European Journal of Operational Research,2002,136.