CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
The growing need for construction of all types coupled with a tight monetary supply has provided the construction industry with a big challenge to cut cost.
According to Mendelson & Greenfield (2006), the dwindling fortune of nations economies around the world have geared up the participants in these sectors (the clients in particular) to take up the challenge of ensuring efficient use of their resources to obtain value for money in terms of performance.
The total cost of construction in normal circumstances is expected to be the sum of the following costs: Materials, Labour, Site Overheads, Equipment/Plant, Head office Cost and Profit but in many parts of the world particularly in Nigeria, there are other costs. These costs according to Mbachu and Nkado (2004) have obvious negative implications for the key stakeholders in particular, and the construction industry in general.
To the clients, high cost implies added costs over and above those initially agreed upon at the onset, resulting in less returns on investment. To the end users, the added costs are passed on as higher rental / lease costs or prices. To the consultants, it means inability to deliver value - for - money and could tarnish their reputation and result in loss of confidence reposed on them by clients.
To the contractors, it implies loss of profit through penalties for non-completion, and negative word of mouth that could jeopardize their chances of winning further contracts, if at fault.
