Topic: Construction Industry

Subject: Overhead rates
Bob Wills
Member: 2005
Posts:3
Submitted on 08-08-12 6:16 pm
Message:
We are a very large design and construction firm. Our history has been in the design business but over the last few years we have developed a large construction management sector as well. Our traditional method for allocating overhead is being skewed by the large CM revenuew with low direct labor compared to our design with lower revenue but large direct labor. When we attempted to develop new rates that took construction management fees into consideration as overhead coverage, the numbers looked very strange.

Would anyone be willing to share your allocation method/model with me as my experience in this industry is within much smaller and single revenue streamed companies?
Thanks.

Bob Wlls
CFO
bwills0654@msn.com
 
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Replies
Bruce Lynn
Member: 1998
Posts: 68

Subject: Re:Overhead rates

Submitted on 08-15-12 4:51 pm.
Message:
Bob

If you are still looking I can send out a note to several other FENG members
 
Bob Wills
Member: 2005
Posts: 3

Subject: Re:Overhead rates

Submitted on 08-15-12 9:56 pm.
Message:
Yes we are still looking for methods. Thanks.
 
Brian Rowland
Member: 2012
Posts: 4

Subject: Re:Overhead rates

Submitted on 01-22-14 6:52 pm.
Message:
Bob, FMI (fminet.com) has a good system for allocating overhead across projects, especially where some are more labor intensive or dramatically different in contract value. I learned it at their "Pricing and Bidding" workshop and it helped me understand the optimum allocation across our larger projects as general contractor and the smaller work as a carpentry trade contractor. Let me know if you are interested in talking. - Brian Rowland - brian@cdmone.com
 
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