6 Common Errors in the Preparation of Construction Estimates


Making errors in a construction project is common, especially while estimating the cost. But the bad news is these little errors add up in the final budget and devastate the outcome.

Luckily, you can take help from construction management tools like Bridgit to estimate construction projects.

Construction projects also need a diverse team to complete them efficiently, including engineers, architects, and managers. The diverse group of experts plays an important role in each construction activity.

So if you are looking to prepare cost estimation, here are the six common issues you want to avoid:

1. Ignoring Cost Details

The construction cost details come from a reliable source, usually credible software.

That software must be powerful enough to derive minute calculations from the input data and provide the required project cost estimation.

However, managers tend to focus on the big numbers and ignore the small amounts.

For example, the total procurement cost estimate for a construction project is $150,000. But the documentation cost is only $30 – $70. 

Although the latter cost is smaller than the procurement cost, it must be in the final cost estimation. Ignoring such small costs adds to the total cost, eventually exceeding the construction budget.

Similarly, some costs vary with the situation. For example, the import duty for ordering a special material for construction might increase from next month. But you ignored the new charges and didn’t update the custom charges.

Doing that will also affect the construction cost estimation, especially when importing multiple items without updating the import taxes.

Unfortunately, many construction management software programs do not offer the cost estimation feature.

That’s because:

  • Calculating less-obvious costs is difficult
  • Varying labor costs with the inflation on national-level
  • Not updating taxes such as tariffs

Therefore, always mention every cost while estimating the construction budget. That will help you avoid unnecessary cost addition when the project is completed.

2. Incorrect Market Estimates

The construction equipment and material market have become highly volatile, especially after COVID-19.

Construction companies are also building more residential and healthcare projects to cater to the situation.

In a survey shared with BBC, managers said that almost 84% of the firms switched to hybrid working mode.

The work-from-home (WFH) culture has also become a new trend. That’s why homeowners are converting their residential properties into remote workspaces.

Such a change in the market affects the construction cost estimates. No one knows the next trend in the employment and business sector.

That’s one example of how the need to have huge offices has been reduced due to the global pandemic.

Financial managers usually ignore such market changes, which leads to cost estimation errors.

Similarly, the material and equipment cost for a construction project also changes, which include:

  • Machinery – Heavy equipment used in construction projects.
  • Labor – Labor costs such as wages, benefits, and salaries.
  • Health – Health precautions for the workers, especially at the construction site.

So, always take the latest market costs for construction projects. You might never keep up with the estimated construction budget if you ignore the updated costs.

3. Not Visiting the Construction Site

One of the biggest mistakes of project managers is not visiting the construction site before cost estimation.

The construction site has a lot to observe, especially if the project begins with demolishing a building.

Experts suggest visiting the construction site multiple times helps you estimate the project cost better. If you can’t visit the site multiple times, ensure you do it at least before estimating the construction budget.

Suppose you didn’t visit the construction site and believed every word the workers reported to you. Also, you analyzed all the documents and ordered the demolition of the building.

After a day, you receive a call from the municipal authority about the illegal building demolition because the nearby public area was not ready to hear such blasting.

However, when you inspected the issue, the engineers didn’t inform you that the urban development authority didn’t give permission for the implosion.

Such mistakes might cease the project and impose fines on the construction company.

4. Overlooking Risks

Another error while making a construction cost estimate is when the financial managers overlook the project risks.

The risk assessment of a construction project is a crucial step for cost estimation. These risks have a significant effect on the final budget.

If you don’t create a contingency plan and ignore the risks associated with the construction project, you might have to face the consequences in terms of:

  • Financial loss – The final construction budget might exceed more than 50% of the estimated cost.
  • Accidents – The workers might be involved in accidents at the construction site.
  • Penalties – Municipal and development authorities might penalize your company.
  • Credibility – Clients and contractors will no longer trust you.

The good thing about investing in contingency planning is you can get a big portion back by claiming reimbursement.

So, assessing the construction project risks and preparing for the worst can help you avoid high costs otherwise.

5. Pursuing the Perfect Construction Budget

You must give yourself and your team leverage while estimating the construction budget.

That’s because unexpected situations can happen anytime, so you can never estimate the “perfect” construction cost. Going hard on the team won’t do any good, except it will stress the members.

Due to the competition, many project managers become too strict while pursuing the perfect construction cost estimate.

However, that only affects the relationship between the employees and the managers. As a result, the project will lose its quality, and you will begin to miss deadlines.

No construction project expert has ever derived a formula to estimate the perfect construction budget.

Instead, they suggest preparing for the unexpected until the project is completed.

6. Complete Dependency on Software

You can rely on construction management software, but 100% dependency on technology is never a good idea.

No doubt, the software suite optimizes every construction activity. It saves you time and resources to some extent. 

But every construction project requires a combination of civil engineers, architects, designers, electricians, contractors, and project managers.

So you must have construction experts on board along with credible software. 


The cost estimation errors mentioned above are common in today’s construction industry.

So always review the project budget and consider the risks and unexpected situations. That will help you make an optimum construction estimate.

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