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AGENDA• Advantage• Attributes• Economic assessment• Disadvantage
Business Perspective
The motivation for using modular construction specially after disaster situation arises because of over-riding client requirements for speed of construction, improved quality, and for early return of investment. Furthermore, there is a noticeable trend to use modular construction in social housing, where speed of construction is allied to economy of production scale, and to reduced disruption in congested inner city sites.
Key advantage of modular construction in business impact:
Short build times Typically is 50-60% less than traditional on-site construction, leading to an earlier return on investment and saving in preliminaries.
Economy of scale Repetition of prefabricated units leads to considerable economy of scale in production.
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Reduced site labor requirement The erection and finishing teams, which install and complete modular buildings, involve less workers on site than traditional buildings.
Reduced professional fees Standardised design details for modular buildings simplify and reduce the need for specialist design input.
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The attributes of modular construction that are compatible with these objectives are:
Reduced construction costs, especially when combined with economy of scale production (10%+)
Much reduced construction time on site (50 to 60%)
Increased profitability of the industry due to economy of manufacturing scale
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Increased site productivity (up to 50%)
Greater certainty of completion on time and to budget
Much reduced wastage in manufacture and on site
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Economic assessmentThe economic assessment was split into two parts:
1.Cost assessment: The actual costs of using modular construction
were compared to ‘traditional’ construction as established through a Bill of Quantities.
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Economic assessment
2. Financial assessment:
These benefits are related to speed of construction and improved cash flow.
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Economic assessment
The most important financial aspects of the assessment using the Modular system that are quantified in the study are:
Savings in construction time with improved quality, leading to reduced site preliminaries and expensive call-backs.
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Reduction in financing cost by earlier return of initial capital, less cost of temporary accommodation and increased asset value.
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For very specific modules the cost of making interfaces can be high (Schilling, 2000)
Disadvantages
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