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Indirect Expense Job Allocation for General Contractors

  • 1.  Indirect Expense Job Allocation for General Contractors

    Posted 03-13-2019 10:38
    From a general contractor's perspective, how do you all charge your jobs for indirect expenses, particularly usage of small tools and project manager/engineer time?  Being new to the GC world (previously worked for a subcontractor), I'm learning that some owners allow us to include project management/engineer time in our general conditions and others do not.  Also, I'm trying to develop a consistent way to charge small tool usage to our jobs.  I have ideas on how to do this but I want to see if they are consistent within the industry.

    To-date, small tool purchases have been charged directly to the job in most cases.  PM and PE salaries have been charged to overhead, but at the end of 2018 I did an allocation to job cost a % of their salaries.  Our PMs and PEs also do some estimating, so 100% of their time is not billable to jobs and we do not require them to keep time cards.  Our estimators currently do not have a solid way to come up with budgeted amounts for these general condition items.

    We are a newer GC company with young professionals, so forgive me if the answer to these questions may seem like a no brainer.

    Thank you in advance for any input you can provide regarding indirect expense job allocations and compilation of general condition budgets!

    Krystal Sund, CCIFP
    Perry Reid Construction, Lincoln, NE
    (402) 488-1666