How to Calculate Overhead Costs in Construction Projects?

Labour Coast,Materials,accidental,and others.

In construction, overhead costs results from the organization structure, size and form of the enterprise, 

In order to calculate overhead costs it is necessary to analize and collect all the expenses of the company such as office rent, warehouse rent, telephone calls costs, stuff needs, stuff transport, etc and define overhead cost of the company.

 Overhead costs result from the organization structure.

you know what i mean..

Overhead cost is categorized in to two types.

1.   Home office overhead cost ( Fixed cost )

It includes all home office facilities rent, home office staff salary, legal cost and all other general home office expenses. It can be calculated as % (Total home office Overhead cost per year / Annual total targeted job value or Annual total value of project cost). Normally fall under 8-10 % of project direct cost.  

2.   Job  Site overhead cost (Variable cost )

It includes all the site supervision personnel salaries, temporary facilities, utilities, transportation, Plant & Scaffolding and other time variable miscellaneous charges. These are all based on project duration and can be calculated. It varies based on organization reputation and standards.

Overhead costs are all those indirect costs like laqbor costs, rent, travel expenditures, utilities and communication bills, supplies, advertising, insurance accounting, legal fees, etc.

In Fact, it depends on the project duration and the size of the project as well, there are several effects, but roughly I would like to say 5-10% of the total project cost.

A good study of building by analyzing the drawings and visiting the construction site, writing the reports that indicate the topography of the site and the possibility of availability of raw materials and services required in addition to the statement whether there is something to be removed on site or not. Calculation of quantities and determination of units of measurement for each part. Calculate the cost to complete each part of the construction. Calculate the cost of labor. Calculate the cost of equipment to be used in construction. Calculate the cost of concrete contractors. Calculate the cost of taxes, administration and various insurance. Calculate total cost by collecting data from step 3 to step 6 to calculate the total cost of project construction.

In construction, overhead costs results from the organization structure, size and form of the enterprise, 

Overhead costs are all those indirect costs like laqbor costs, rent, travel expenditures, utilities and communication bills, supplies, advertising, insurance accounting, legal fees, etc.

Labor Cost + Logistics expenses +  office expenditures + Misc. expenses + accident cost and other unforseen expense if happened. 

normally 10% to 15% we can take