Being in the construction industry comes with its headaches. There are many moving parts that have to be right, or things can fall apart. Getting an estimate put together can make or break you. 

With 1.2 million houses planned and built every year, it is imperative that you take the steps to meet the demand in your area. Making construction cost estimating accurate will be beneficial to you and your clients. 

In this blog, you will learn about what construction cost estimating is and how software can help with your estimates. So that you can land more projects down the road.

What is Construction Cost Estimating?

Construction cost estimating is a potential cost of how much a construction project will be. Keep in mind the price could change, but you will want to make one where it won’t change drastically. 

In the construction industry, it is important to create an estimate when you are working on landing a potential client for a job. When creating an estimate, you need to make sure it is as accurate as possible. This is especially difficult if you are trying to do it all on your own and in a spreadsheet. 

In construction, costs are ever-changing, so you will not be able to use the same estimations for every job you do. A common issue for cost estimating is forgetting an item and leaving it off an estimate.

What is Included in an Estimate? 

When creating an estimate for construction, there is a lot to keep in mind. First, you need to know what materials are required and the price of those materials.  

You also need to include the labor cost and profit. It’s important to note that outside factors will almost always arise during projects, which will impact the cost and your estimate, however, having an accurate figure at the start is more beneficial than having an inaccurate one. 

While completing your estimates, you need to take into account the client’s budget. If you ignore it, there is a chance that if it is over budget and you will not get the contract. 

Fixed Budget vs Open Budget

If you have a potential client that has a fixed budget, you need to make sure the estimate doesn’t go over the set amount. With a fixed budget, it is imperative that you have an accurate estimate. 

When your potential client has an open budget, you will not have to worry about a set price. Additionally, you will not have to worry when issues pop up during the construction process as much as you would when you have a client with a fixed budget. 

What is the Construction Estimating Process? 

While completing the estimate for construction costs, there are some processes to consider that could take up several parts. In this, you would take in what the project cost will be by keeping up with the ever-changing market. 

Construction costs are considered for everything done during the job. This also means every single material that was needed for the job as well. 

How to Calculate the Estimate 

You can do this manually, but you will not save time doing so. When you need to calculate the cost, you need to take in the square footage of what you are constructing. 

To do this you would separate your labor and material costs and then divide the costs by square footage. Remember to do this separately, but for both construction materials and labor. 

How Software Can Help with Cost Estimating 

Using software can help you get more accurate estimations. Most will have a built-in construction cost estimator that takes a lot out of the guesswork. It can also help you increase your production time. 

Construction estimating software, such as Sage Estimating will help you with everything you need for your estimate. Sage Estimating also has a UI spreadsheet that will cut out inaccuracies of the formula getting accidentally erased. This eliminates the time and money that it would take for you to build and fix your own.

What is Takeoff Software?

Takeoff software is there to help the contractor save time. Doing takeoffs can be complex, especially if there is a large list of materials on the estimate. 

The takeoff process is supposed to account for all the materials and the cost of the project that is required to complete it. Using takeoff software can help you get the accurate information that you need in a timely fashion instead of you trying to do it manually. Most takeoff software can read blueprints whether it is in a 2D or 3D environment.

Fast-Track Your Construction Cost Estimating

With the knowledge of how to make your construction cost estimating faster and more efficient, you can focus on making aspects of your career easier. 

Want to see how construction software can help your processes? Reach out to us!