A comparative analysis of tender sums and final costs of public construction and supply projects in Nigeria

Article

Olatunji, Oluwole Alfred. 2008. "A comparative analysis of tender sums and final costs of public construction and supply projects in Nigeria." Journal of Financial Management of Property and Construction. 13 (1), pp. 60-79. https://doi.org/10.1108/13664380810882084
Article Title

A comparative analysis of tender sums and final costs of public construction and supply projects in Nigeria

ERA Journal ID124694
Article CategoryArticle
Authors
AuthorOlatunji, Oluwole Alfred
Journal TitleJournal of Financial Management of Property and Construction
Journal Citation13 (1), pp. 60-79
Number of Pages20
Year2008
Place of PublicationUnited Kingdom
ISSN1366-4387
1759-8443
Digital Object Identifier (DOI)https://doi.org/10.1108/13664380810882084
Web Address (URL)https://www.emerald.com/insight/content/doi/10.1108/13664380810882084/full/html
Abstract

Purpose: The purpose of this study is to investigate the relationship between tender figures, consultants' figures and final construction costs of construction projects under competitive bidding in the Nigerian construction industry, as guided by the due process policy, a national public procurement reform program. Design/methodology/approach: A total of 13 construction professionals and public contract administrators were interviewed. Their views were reported intermittently as the secondary data collected on 137 projects; 95 of these were construction and 42 supply projects. The findings are then analyzed and discussed. Findings: The study presents a number of regression models which can be used to predict the final cost and actual duration of construction and supply projects under the due process regime in Nigeria as functions of lowest bids, consultant estimates, successful bid, gross floor area, average bid, contractor's proposed contract duration and the consultant's proposed contract duration. Practical implications The models used, apart from being worthy benchmarks for future study, can be of immense use to developing countries with the intention of implementing the due process policy of Nigeria in their countries as the limitations of the reform are succinctly discussed. Moreover, with the growing prospect for heavy engineering projects, the study will be of use to intending international contractors willing to explore the Nigerian construction market, either by holistic participation or by forming partnerships or alliances with Nigerian domestic firms. Originality/value: The paper presents one of the pioneering stochastic studies based on empirical data on construction and supply projects under the due process reform in Nigeria.

KeywordsAsset valuation; Construction industry; Nigeria; Project management; Tendering
ANZSRC Field of Research 2020330299. Building not elsewhere classified
330207. Quantity surveying
330203. Building industry studies
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Byline AffiliationsFederal University of Technology, Nigeria
Institution of OriginUniversity of Southern Queensland
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