New Classification of Construction Companies: Overhead Costs Aspect / Naujas Statybos Įmoni Ųklasifikavimas: Pridėtinių Išlaidų Aspektas (original) (raw)
Related papers
New Classification of Construction Companies: Overhead Costs Aspect
Journal of Civil Engineering and Management, 2011
The traditional classification of construction companies depending on the number of employees is not appropriate when analysing the competitiveness of construction companies. The collected data of Lithuanian construction companies was analysed by applying statistical methods and the construction companies were classified into competitiveness classes according to the relative value of the overhead costs. The new classification provides the basis for economical evaluation of the construction companies and modelling of their competitiveness in regard to the value of overhead costs as well as applying the competitive advantages for the estimation of construction bidding price.
2017
The business of each company is confronted with difficulties, trends, situations, circumstances and events that occur in the business process itself. The critical point of each business is precisely the analysis, because through it, the understanding and importance of all phenomena and situations in the required volume. In research discuss economic performances, the financial position and results of the business operations of five selected construction companies in order to review their real economic position. It focuses on the business of five dominant construction companies from the territory of Republic of Serbia and Republic of Croatia for the period of three business years from December 31, 2014 to December 31, 2016, with focus on enterprice Energoprojekt holding a.d. In addition, the research should determine the impact of the dynamics and complexity of market conditions on the performance of enterprises from construction sector of industry, above all indicators of efficiency,...
Overhead Costs and Profit Calculation by Polish Contractors
Technological and Economic Development of Economy, 2013
The main criterion taken into consideration when choosing a contractor is the bid price that the contractor suggests. The basis for determining such a price are the direct costs connected with works realization as well as mark-ups, mainly overhead costs and profit. Overhead costs and profit constitute a considerable part of the bid price and their improper calculation can significantly influence the financial situation of the company. In literature and in practice one can find many definitions and ways of determining overhead costs and profit. The article presents research results concerning defining and calculating overhead costs and profit by Polish contractors, carried out twice – in 2004 and 2010. They were compared with similar studies performed in other countries. The article also presents mathematical methods created by the authors, by means of which overhead costs and profit can be calculated more precisely than by the popular methods commonly employed by Polish contractors.
Journal of Construction Engineering and Management-asce, 2010
The purpose of the paper is to examine trends in the performance of the Portuguese construction industry, and identify the factors that promote excellence and innovation in the sector. From a methodological perspective, this study enhances the construction of composite indicators using the principles of the ''benefit of the doubt'' weighting. This involves the use of Data Envelopment Analysis to estimate weights for aggregating the key performance indicators of the construction companies. The paper also proposes a new DEA-based method to assess innovation within an industry, identifying the innovative companies and the extent of innovation. The determinants of good performance and innovation are examined using regression techniques and the statistical significance of the results is ensured by the use of bootstrapping. The study reveals that the Portuguese construction industry experienced a remarkable performance improvement during the 1990s, but this growth trend in performance slowed down in recent years. It is concluded that company performance is strongly affected by the national economic context, and that small specialized companies and large contractors tend to achieve the best performance levels. (I.M. Horta). 1 In 2011, the total number of companies operating in the Portuguese CI was 60 990. The majority of these companies correspond to sole proprietors (37 405) with very limited skills, that do not have minimum obligatory requirements. The remaining companies are general contractors (23 585) that can operate in different areas related to construction and have minimum obligatory requirements (e.g. at least 100% on Liquidity and 5% on Financial Autonomy, since year 2010). The number of large companies, with more than 100 employees, is at most 284 corresponding to 1.2% of general contractors. All companies studied in the paper correspond to general contractors.
Key performance indicators to improve the competitive dimensions of the construction company
Research, Society and Development
The construction industry is a significant economic and productive sector of a country. Due to the importance of the sector, this study is justified not only for the academia, but also for the productive and business circles. Identifying competitive dimensions and comprehend the organizational performance through performance indicators, allows managers to make decisions through these tools, according to the model in which the organization operates, as close as possible to their reality. The present work aims to analyze the application of performance indicators through the competitive dimensions of the construction company. The used research method was a qualitative approach, being of an applied nature, classified according to the objectives of the research in descriptive and explanatory. The procedure used was the review of the literature through scientific articles in the Web of Science data bases, for the last ten years.
The management of construction company overhead costs
International Journal of Project Management, 2001
This paper investigates the overhead cost practices of construction companies in Saudi Arabia. Although overhead costs are extremely important in construction estimation, they can be easily overlooked. Neglecting overhead has forced some contractors out of business, because these costs constitute a signi®cant portion of the total construction cost. The practices of 61 large building construction contractors were investigated via questionnaire. The questionnaire has three parts covering the construction ®rms, overhead costs in general, and company overhead costs. Results show that average overhead cost is slightly higher than the ratio reported in the literature. The average percentage of company overhead costs to project direct cost is greater than 10%. Causes of increased company overhead costs include delayed payments, shortage of new projects, cost of in¯ation and governmental regulations. Factors aecting company overhead costs include the following: automobile and equipment costs, head oce expenses, labor related costs and ®nancing costs. The unstable construction market makes it dicult for contractors to decide on the optimum level of overhead costs that enables contractors to win and eciently administer large projects. #
Calculation methods for cost management in the construction industry
Entrepreneurship and Sustainability Issues, 2019
Information on costs in the system of information on the activities of construction organizations plays a significant role in making managerial decisions, since the main indicators characterizing the activities of the organization are the volume of costs and the cost of production calculated on the basis of data on costs. The relevance of this article lies in the fact that the technology of construction production has a number of specific features that affect the organization of analytical and synthetic accounting of business entities. High competition, the search for reserves to reduce the cost of construction products and increase profitability require information on the real level of costs, rationality of use various resources. In the management system of a construction enterprise, an important place should be given to management of construction costs.The article also considers analytical tools and recommends a combined system for calculating the cost of construction products in the organization of management accounting, ensuring the adoption of effective management decisions of the construction company. When writing the article, general scientific methods of cognition (statistical, normative analysis, synthesis, analogy, generalization), empirical-theoretical (collecting, studying and comparing data), as well as methods of scientific cognition (historical and legal, systemic) were used. When processing and systematizing data, grouping and classification methods were used. The information-statistical base of the study was made up of data from official periodicals and information-analytical publications of the Republic of Kazakhstan.
Scientific & Academic Publishing
Nowadays, construction industry is one of the most important sectors in the competitive markets. The increasing of the competitiveness of the active companies in the field of construction is one of the most important strategic purposes in the construction industry. Construction companies must search continuously for finding ways of reducing their costs and offering high quality services if they want to stay in the competition. Overhead costs, the major sectors of the project costs, is one of the important cost stations which can have better control and management which leads to the increasing of the winning chance in the bids’ companies and have a considerable effect on the financial condition of the company. This paper reviews the key papers published in the time period from 1999 to 2013 and extracted the effective factors on overhead costs of the literature further by sending questionnaire to 49 authoritative contractor companies in Iran and collecting 25 valid responses. This research also provides a list consist of 30 effective factors on overhead costs in construction projects in Iran in four fields: (a) project, (b) client, (c) Government regulations, and (d) environmental factors.
Economic Evaluation of Administrative Burden for Construction in Jelgava Municipality
International journal of economics and finance, 2011
The aim of this research is to make an economic assessment of the administrative burden, which is created by the construction regulation, on enterprises of Jelgava municipality in Latvia and to find solutions of how to reduce the administrative burden on enterprises by having no negative impact on the construction process. The research was carried out in the period 2009-2011. To evaluate the administrative burden, the Standard Cost Model with some modifications and adaptations was used. It was concluded that 9 legislative acts related to construction are creating a notable bureaucratic burden (EUR 2.94 million annually) on enterprises in Jelgava municipality. The authors have developed 37 recommendations to reduce the administrative burden and by implementing these recommendations, the administrative burden on enterprises could be reduced by 45% or EUR 1.33 million annually.
Determinants of construction organisational performance A partial least square-path analytic method
Journal of Financial Management in Property and Construction, 2017
Purpose – Literature suggests that there are sets of common variables that are capable of explaining organisational performance differentials. These variables are used to examine performance variance and its contribution to organisation profitability. Therefore, the purpose of this paper is to examine the determinants of large construction organisations’ performance in South Africa using a partial least squares path analytic method. Design/methodology/approach – This study examines the interrelationship between a number of constructs, namely, organisational characteristics, resources/capabilities, competitive strategies, business environment and performance, using a questionnaire survey to obtain data from 72 large construction organisations in South Africa. Using a path analytic approach, the paper examines the relationship between the constructs discussed in the study. Findings – The findings from the analysis of the data show that organisational characteristics do indeed influence the performance of organisations and that the business environment is capable of moderating the relationship between competitive strategies and performance. The results, however, indicate that organisations that combine sustained organisational characteristics and strategy tend to experience high performance over those that do not. Originality/value – The study findings have implications for management practice, as it could help managers of construction organisations to acknowledge the influence of organisational characteristics, unique resources/capabilities, competitive strategies and business environment as sources of competitive advantage. The study contributes to the current debate on the causes of performance differentials among large construction organisations.