Cost Estimating 101

Cost Estimating cost of equipment and construction projects requires determining the cost of several components:

  1. Labor hours required to compete a task. Labor hours can potentially include foreman’s, supervisors,
    inspectors, surveyors, engineering, drafting, and office staff.
  2. Labor hours can potentially be impacted by delays.
  3. Labor rate which includes taxes, insurance, union dues, and other factors.
  4. Labor (hours and rates): Estimating Cost Books can be very helpful, understand factors (up or down) for actual cost for the specific project.
  5. Equipment hours which could potentially include idle time.
  6. Equipment rate which includes transportation.
  7. Equipment (hours and rates): Estimating Cost Books can be very helpful, understand factors (up or down) for actual cost for the specific project.
  8. Equipment rates: Website costs can be very helpful, understand factors (up or down) for actual cost for the specific project.
  9. Small tools.
  10. Material cost which includes freight cost. Potentially include waste or overages.
  11. Material cost can potentially be impacted by delays.
  12. Material cost: List Price Sheets can be very helpful, understand factors (up or down) for actual cost for the specific project.
  13. Material cost: Website Pricing can be very helpful, understand factors (up or down) for actual cost for the specific project.
  14. Material cost: Estimating Cost Books can be very helpful, understand factors (up or down) for actual cost for the specific project.
  15. Quotations received (past, present, or project specific) can be very helpful, understand factors (up or down) for actual cost for the specific project.
  16. Subcontractor cost (if applicable).
  17. Costs from Agencies and Public Bids can be very helpful, understand factors (up or down) for actual cost for the specific project.
  18. Contingency (if applicable).
  19. Home office overhead (if applicable).
  20. Field office overhead (if applicable).
  21. Temporary trailer (if applicable).
  22. Temporary water, electricity, gas, phone landline, cell phones, lap top computers, printers,
    and pickup trucks (if applicable).
  23. Temporary storage (if applicable).
  24. Temporary stockpile (if applicable).
  25. Site security (if applicable).
  26. Instruction manuals and material submittals (if applicable).
  27. Tax (if applicable).
  28. Escalation / inflation (if applicable).
  29. Bonds (if applicable).
  30. Delay of payment: cost of money (if applicable).
  31. Markups (includes profit).
  32. Change orders.

Note: Websites, manufacturers, representatives, and distributors sometimes have: Website Pricing, Reference Pricing, and List Price Sheets.
Please always use as a reference. Actual quotations are suggested for those bidding projects. Also consider the cost of writing multiple
purchase orders, freight, time to get material, and taxes.

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