What is cost and cost control techniques for a construction firm?

Cost control is a process where the construction cost of the oject is managed through the best methods and techniques so that the contractor does not suffer losses when carrying out the activities of the project.

What is a cost control in construction?

Cost control in construction is the process by which managers keep expenses under control by managing labor, material, and overhead costs to ensure that the project finishes on budget.

Which tool is used for cost control?

Ratio analysis is used as an instrument of cost control in two ways: (i) Ratios can be used to compare the performance of a business firm between two periods. It helps to identify areas which need immediate attention. (ii) Besides, standard ratios are used to compare actual areas.

What are the material control techniques?

Material control aims at eliminating and minimising all kinds of wastes and losses while the materials are being purchased, stored, handled, issued or consumed. A number of techniques are used at planning, procuring and holding stage of material which help in exercising and effecting material cost control.

How do you control a construction budget?

Here are 5 Tips for Construction Cost Control:

Use construction management software.
Regularly update cost plan.
Consistently submit cost reports.
Prepare and review contingency plans.
Encourage project team to design within the cost plan at all stages.

Why is cost control important in construction?

The objective of cost control is to manage the delivery of the project within the approved budget. Regular cost reporting will facilitate, at all times, the best possible estimate of: Established project cost to date.

What are methods of cost control?

COST CONTROL. Cost control, also known as cost management or cost containment, is a broad set of cost accounting methods and management techniques with the common goal of improving business cost-efficiency by reducing costs, or at least restricting their rate of growth.

What is cost control procedures?

Cost control typically includes (1) investigative procedures to detect variance of actual costs from budgeted costs, (2) diagnostic procedures to ascertain the cause(s) of variance, and (3) corrective procedures to effect realignment between actual and budgeted costs.

What is cost control in project management?

Cost control and management encompass the implementation of an effective strategy along with ensuring discipline to drive the highest level of quality, productivity and reliability for the project at an optimal cost. Rather than aiming at cost-cutting, cost management is about optimizing performance.

What is project cost control?

2. Project Cost Control. Introduction. Cost control is the process of recording, analyzing, forecasting, and reporting project cost and revenue data and communicating deviations against project baselines to management to assist in minimizing project cost impacts and maintaining project profitability.