This guide will explain how to Estimate Equipment Cost in Construction. Cost estimation is incomplete without including equipment costs. It accounts for about 15% of the total construction for, or maybe more, depending upon the requirements.
Every construction project requires equipment, whether it is lightweight or heavyweight machinery. There are many different types of machinery used for construction. It’s vital to calculate their cost effectively.
Types of Equipment Used in Construction
- Excavators
- Graders
- Loaders
- Lifts
- Pavers
- Compactors
- Bulldozer
- Drills
- Backhoes
- Trenches
- Dump Trucks
- Light Towers
- Scrappers
- Draglines
- Concrete Mixers
- Pile Drivers
- Transfer Vehicles
- Cold Planers
Determinants to Estimate Equipment Cost in Construction
The following are the costs that need to be calculated to estimate equipment costs in construction.
1) Purchased or Rental Cost
The purchase and leasing cost of equipment needs to be included in the budget. In most cases, heavy-weight machinery needs to be rented out. Commercial and industrial projects tend to have a higher rental cost of equipment as compared to residential projects. But it all comes down to the condition of the site. Most machinery is rented out every month. Pro tip: Costs can be brought down by negotiating.
In the case of a purchase cost, one must also consider interest rates and loan terms.
3) Understand Resale Value
Resale value may also sometimes impact the overall cost of construction. Contractors should know that resale value decreases over time. This means the more you use the machinery, the less the resale cost. Accurate calculation of resale cost leads to long-term efficiency of the project.
4) Select the Right Equipment
If you are unsure which type of machinery will be used for a particular project, it’s best to get professional help. Construction Material Takeoff Services can precisely quantify the materials needed to complete the construction project. With the help of an accurate takeoff, the cost of equipment can be analyzed easily.
Equipment selection mainly depends on your needs and requirements. Some construction sites are rough, with lots of vegetation, so special equipment is required to clear them. While some sites don’t require much levelling and grading work.
CONTROL AND REGULATE EACH ASPECT OF THE ESTIMATION PROCESS AND MAKE YOUR PROJECT A PROFITABLE VENTURE!
Accurately Estimate Equipment Cost in Construction!
Follow these steps to accurately estimate equipment costs in construction.
1) Make a List of Equipment Needed
Achieving accuracy can be tricky if there is poop planning. That is why you have to properly outline each aspect. When it comes to equipment, make sure that you are well-prepared and have listed out everything that you need. This can be done by assessing the whole construction project.
2) Add all the Costs
Adding the estimated cost can be useful. It will give you a sketch of the performance of the budget. It will also prevent you from over- or underestimating. You must stay within the limitations of the budget.
3) Create a Contingency Plan
Having a Plan B can help you in so many ways! Construction work is prone to so many unfavorable events. It can be fluctuations in price or material shortages. On the other hand, the labour in your region can go on strike or experience equipment failure. If that won’t be the case, then it can be uncertain weather conditions. That is why it is important to include contingency costs in the estimates. That way, you will be prepared in advance for any unexpected event.
Best Practices For Estimation
1) Historical Data
You can use historical data for a project that is similar in nature. It will serve you in two ways. The first one is that it will provide a map of how to estimate the cost of equipment and other costs as well. The second way is that it will save time and money as you will have a rough estimate.
2) Cost Estimating Firm
A wiser approach is you hire a Cost Estimating Firm. There are so many reasons for this. Firstly, they are professionals and know the current conditions of the market. It will give you more time to focus on other aspects of construction. By hiring experts, you will have time on your hands to perform other essential activities. Cost estimators use advanced techniques to assess the cost of any type of construction project.
3) Software
Accuracy can become impossible or very delayed without the use of advanced software. These softwares are known for their proficient precision and speed. They can perform calculations in a matter of seconds. Not only that, but they also offer other essential features like task management and scheduling, billing, accounting, Construction takeoff, resource management, etc. Here is the most used software:
- STACK
- Trimble
- ConEst
- Bluebeam
- On-Screen Takeoff
- PlanSwift
- Fast Pipe
- RS Means
- RFMS
Final Thoughts
In the end, the process to Estimate Equipment Cost in Construction can be hectic if not managed properly. For proper management, you need to be thorough. Thus, this article can help you with that. It outlines some of the most important determinants for the equipment estimation process. Also, it discusses how to make the estimation process more accurate. In addition to that, it also discusses what practices can be adopted.