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Features

Estimating and job costing per project

What did this project really earn? With estimating and job costing in Lean, you see per project the budget next to the actual cost, and where the margin differs from what you had estimated.

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The question after every project

Selling is one thing. But what was left after purchases, hours, transport and extra work? And why was it less than planned: was it the price, the consumption or the hours?

In many companies that answer is scattered across invoices, timesheets and a spreadsheet. In Lean it sits in the same file, because the quote, the purchases and the execution are already there.

It starts with the estimate

Cost and price on every lineEvery quote and order line has a selling price and a cost price. The margin per line adds up to the quote, the order and the project.
Budget per categoryOn the project you set a budget per category: materials, hours, subcontracting or whatever fits the way you work.
Prices stay putA document keeps its own prices. A quote from last year still shows what it was then, even if the item has become more expensive since.

Budget and reality side by side

During and after execution, Lean compares the budget with what the project actually cost.

Project result: per cost type the budget and the actual cost, such as materials, hours, machines, drawing work, transport and extra work. With the margin you estimated and the margin you are achieving now.

Where is the difference? The variance is split up: was it the price, the consumption or the hours?

From ordered to final cost: per category you see what was ordered, what it actually cost and what the final cost will be. From every figure you click through to the order lines behind it.

Price trends: on purchasing you see how prices develop per supplier, per item group and per item.

Where the actual cost comes from

Job costing is only as good as what is recorded on the project. In Lean, the actual cost comes from purchases linked to the project or to an order line, from hours registered in production and from standard costs, for example for machines.

Which costs you want to follow at which level, and how hours and subcontracting reach the project, we agree at the start. So you know in advance which figures to expect later.

Timesheets and work orders ›

A better quote for the next project

If you know where the margin of the last project went, you estimate the next one better. Because the estimate, the purchases and the job costing sit in the same file, nobody has to copy figures to see it.

With IRP you also see per process step which information is still missing, so the execution brings fewer surprises. How IRP works.

Frequently asked questions

What is the difference between estimating and job costing?

The estimate is what you calculate beforehand: cost price, selling price and budget. Job costing compares that with what the project actually cost.

Can I see per cost type where the margin was lost?

Yes. The project result shows per cost type the budget and the actual cost, and splits the variance into price, consumption and hours.

Can I go from a figure to the details?

Yes. From job costing you click through to the order lines behind the figure.

Does this also work for production, not just for projects?

Job costing runs per project. Hours registered in production are included in the project result.

Read on

Project management ›Quotes and sales ›Purchasing ›Reporting and dashboards ›Estimating and quotes in construction ›
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