Common Construction Estimation Terms
Estimate – A detailed prediction of your project’s total cost, covering materials, labor, and other expenses before construction begins.
Takeoff – The process of measuring from blueprints to calculate how much material your project needs.
Bill of Quantities (BOQ) – A complete list of construction items and their estimated costs, helping you plan your budget accurately.
Markup – The extra percentage added to the total cost to include profit and overhead for the contractor.
Labor Cost – The total amount paid to the workers who build, paint, and install everything in your project.
Material Cost – The total price of all construction materials like cement, steel, tiles, and paint.
Overhead – Indirect project costs such as site supervision, equipment, insurance, and utilities.
Contingency – A small extra budget added to handle unexpected expenses or price changes during construction.
Direct Cost – These are the costs directly spent on building your project, like labor, materials, and equipment.
Indirect Cost – Expenses that support the project but aren’t part of actual construction, such as permits, insurance, or office work.
Bid – A contractor’s formal offer showing how much they’ll charge to complete your project.
Scope of Work – A clear outline of what’s included in your project — the tasks, materials, and results you’ll get.
RFI (Request for Information) – A document used when contractors need extra details or clarification before continuing work.
Change Order – Any update or change made to the original plan or design that affects time or cost.
Schedule of Values – A detailed breakdown showing how the total project cost is divided across different work items.
Unit Cost – The price of one specific item or activity, like the cost per brick, tile, or hour of labor.
Hard Costs – The visible, hands-on construction expenses such as cement, steel, wood, and other building materials.
Soft Costs – The behind-the-scenes expenses like design, permits, and project management that make the build possible.
CPM (Critical Path Method) – A smart scheduling method that helps plan each construction step to finish the project on time.
Value Engineering – A process to find cost-saving ideas in design and materials without reducing the project’s quality or performance.
Blueprints – The detailed drawings that act as your project’s roadmap, showing every wall, window, and measurement before construction begins.
Cost Breakdown – A simple list that shows where your money goes — from materials and labor to equipment and overhead costs.
Preliminary Estimate – An early cost idea created before final designs, giving you a rough budget to start planning.
Detailed Estimate – A precise calculation made after the final drawings are ready, showing the true cost of your entire project.
Quantity Surveying – The careful process of measuring materials and labor to figure out how much your project will actually cost.
Punch List – A final checklist of small fixes or touch-ups that must be done before your project is officially complete.
Subcontractor – A skilled specialist, like an electrician or plumber, hired by the main contractor to handle specific parts of the job.
General Contractor (GC) – The main person or company responsible for running your entire construction project from start to finish.
Mobilization Cost – The initial expense for getting the site ready — setting up equipment, materials, and workers before work begins.
Demobilization Cost – The cost of wrapping things up after completion, like removing equipment and cleaning up the site.
Lead Time – The waiting period between placing an order for materials and when they actually arrive on-site.
Depreciation – The gradual loss in value of Construction tools or equipment as they get older or used over time.
Work Breakdown Structure (WBS) – A way to divide a big project into smaller, manageable tasks so everything stays organized and on track.
Milestone – A major achievement or checkpoint in your project, like finishing the foundation or completing the roof.
Estimate Accuracy Range – The small margin of difference allowed between what you estimated and what the project actually costs.
Earned Value – A way to check progress by comparing what was planned versus what has been completed so far.
Procurement – The process of buying all the materials, equipment, and services needed to get your project done.
Cost Overrun – When a project ends up costing more than the original estimate or budget.
Retainage – A small portion of payment held back until the project is finished to ensure quality work.
Bid Bond – A financial promise that the contractor will stick to their bid if they win the project.
Change Management – The process of handling updates or adjustments to the project plan, design, or schedule without causing chaos.
Retrofitting – Upgrading or improving an existing structure to meet new standards or requirements, like adding insulation or reinforcing walls.
Punch-Out – The stage where minor defects or incomplete work are fixed after the main project is done, ensuring everything meets quality standards.
Work-in-Progress (WIP) – The value of construction work that has been started but is not yet finished or paid for.
Construction Schedule – A timeline that shows when each task or phase of the project should start and finish.
Site Inspection – Regular checks done at the construction site to ensure work is following plans, safety standards, and quality expectations.
Warranty Period – The time after project completion during which the contractor promises to fix any defects or issues for free.
Safety Margin – Extra time, budget, or resources added to handle risks, delays, or unforeseen problems during construction.
Work Order – A formal instruction to carry out a specific part of the project, such as installing windows or laying concrete.
Submittals – Documents, samples, or drawings that contractors provide to show the materials, methods, or designs they plan to use for approval.