A job that made money, or did it?
Your estimator priced a housing site with rates per linear metre of drainage at different depths, per manhole, per plot for foundations and substructure, and per square metre of road. The job finished. The overall figures look fine. But nobody can tell you whether drainage made money and foundations lost it, or whether the deep runs were priced right, because costs went to the job, not to the activity.
The next site gets priced with the same rates, and the same question goes unanswered.
Why activity costs stay unknown
Recording costs by activity sounds like extra admin, so it does not happen. Timesheets record the job. Plant goes on the job. Materials are invoiced to the job. The quantities completed, metres laid, plots done, are known on site but never matched to the costs. Without both halves, there is no cost per unit.
- Gang time is recorded by job, not by activity.
- Plant time is charged to the job, if at all.
- Materials invoices are coded to the job.
- Quantities completed are not recorded alongside costs.
- Estimators price from past rates they cannot check.
What not knowing costs
Rates that are too low get used again and again, and you keep winning work that loses money. Rates that are too high lose you tenders you could have won. Problems on a job are only seen at the end, in the total. And the knowledge your best gangs have about how long things really take never reaches the estimator.
The activity costing we build
- Your activity list is set from the way you price: drainage by depth band, manholes, foundations per plot, substructure, oversite, roads and so on.
- Gangers pick the activity when they record the gang's day, with a couple of taps, splitting the day if the gang did two things.
- Machine time is allocated the same way, from check-ins or telematics.
- Materials are allocated from orders, delivery logs and concrete dockets where they are tagged to an area or activity.
- Quantities completed, such as metres of pipe laid or plots finished, come from progress records or are entered weekly.
- Cost per unit for each activity is calculated weekly and compared with the rate in your price, by site.
- At the end of a job, actual rates by activity are saved, so your estimators can see them next to the rates they priced.
| Activity | Priced rate | Actual so far | Trend |
|---|---|---|---|
| Drainage, shallow band | Per metre, as priced | Below priced | Making money |
| Drainage, deep band | Per metre, as priced | Above priced | Losing |
| Manholes | Each, as priced | Close to priced | In line |
| Plot foundations | Per plot, as priced | Above on some plots | Check depths |
We calculate from your records. What rates to use next time is your estimator's decision.
Prices built on what things cost
You see during the job which activities are making or losing money, while there is time to act. Estimators price from actual rates by activity, from several jobs, instead of old rates handed down. Gangers see the effect of their work in figures, which helps good gangs make their case. And the conversation about a difficult job starts from which activity and why, not from the total.
Do you know your real cost per metre?
- Costs are recorded by job, not by activity.
- You cannot say which activities made money on your last job.
- Estimators price from rates they have never checked.
- Problems show only in the final total.
- Quantities completed are not matched to costs.