Making Construction Budgets

The construction budget is the process of calculating the cost of completing a project specific building. This process is carried out by computers, which can be used by companies or general construction firm’s subcontractors. Budgets are usually done as part of the bidding process, where each contractor sends its budget to the owner in hopes of winning the project.

1. Reviews the plans, specifications and all project information. Examine each page prints with care to understand exactly what tasks are involved in the project. Look for any special equipment or facilities that may be added to the cost of labor.
2. Create an offer sheet outlining all tasks to be carried out during the project. For example, a small renovation can include tasks like painting, demolition, carpentry and put soil. Larger jobs may include hundreds of different tasks. Many computers use the CSI Master Format system as a guide when developing an offer sheet. This system will minimize your chances of forgetting certain tasks.
3. Decide whether you’ll need the prices of subcontractors. Examine your offer sheet to see what your company perform tasks and which will be contracted. Send drawings to subcontractor’s asking prices for these tasks. Give them enough time to prepare their offers or their budgets.
4. Calculates the quantity and cost of materials required for each task. For example, measures the total square feet of gypsum board shown on the plans and multiply this figure by the average cost per square foot in your area. Repeat this process for each task on your bid sheet. For information on the average cost to help you with your budget you, refer to the book RS Means Cost Data Construction in the Resources section of this article.
5. Determine the installation and costs of labor for each task on your bid sheet. For sheetrock, you multiply the total square footage for your average cost of labor per square foot. This cost calculated by dividing the hourly wage of your installers by the number of square feet that can be installed per hour. If each installs an average of 100 square feet (9.3 square meters) and charges $ 10 per hour, the cost of the installation is equal to 10/100 or US $ 0.10 per square foot (0.10 square meters).
6. Add all your costs to get to your final budget. It includes labor, materials and subcontractor price. If there are any additional costs that you have not included, be sure to add too. This can include things like licenses, tools, equipment rental, supervision or overhead. Once you’ve reached your final budget, adds a percentage to cover benefits.
Tips & Warnings
 Often, you can find guides updated construction costs in the reference section of your local library.