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Construction Estimating Software: An Introduction

Updated: Mar 16, 2022

Construction estimating is an essential step in any construction project. To accurately gauge the cost of a construction project, builders or general contractors must develop detailed cost estimates, construction plans, and schedules. Fortunately, there are excellent construction estimating software solutions available that are designed for these specific purposes.

While traditional methods of construction estimating used to rely on manual and spreadsheet methods for preparing contracts, innovative commercial estimating software has grown in popularity due to its convenience, accuracy, and time-saving capabilities. Professionals throughout the industry have recognized the invaluable services that construction estimating software has offered when preparing construction estimates for clients.

As a leading provider of construction estimating software, SharpeSoft understands the value of this solution better than anyone else.

In this blog, our experts will cover:

  • What construction estimating software is

  • What construction estimating is

  • Advantages of construction estimating software

  • Why construction estimating software is important

We will also discuss important construction estimating software topics, such as estimating costs and a breakdown of the construction estimating process.

Four construction workers reviewing construction plans.
Construction Estimating Software: An Introduction

Table of Contents:

  1. What is Construction Estimating?

  2. The Construction Estimating Process Explained In 9 Steps

  3. Construction Estimating Costs: Understanding the 5 Key Levels

  4. Construction Costs Influences

  5. What is Construction Estimating Software?

  6. Why is Construction Estimating Software Important?

  7. What Are the Benefits of Construction Estimating Software?

  8. Conclusion

People Also Ask:

What is construction estimation?

An estimate for construction work is known as the process of calculating the costs and quantities of items in connection with the project work.

Therefore it is essential to list and develop an estimate for the work of a construction project based on its plans and specifications.

What is the purpose of estimating?

Construction project estimation helps companies determine the quantity of work, materials, labor, and costs required to complete a project. This estimation allows businesses to prepare beforehand.

What is Construction Estimating?

Construction estimating, also known as construction cost estimating, determines the estimated yet detailed costs of a construction project.

For minor projects, experienced contractors can often come up with estimates off the top of their heads. For larger projects requiring detailed biddings, the estimating process requires more due diligence to get an accurate cost estimate.

To create these estimates, contractors and subcontractors must identify the costs and quantities of work:

  • Materials

  • Equipment

  • Labor

Determining the above factors typically begins with generating a “takeoff” list using the information found in the bidding package.

A Takeoff refers to the quantities and labor needed to complete a construction project. Collecting this information involves a process in which estimators use blueprints to figure out the types and amounts of materials and the necessary labor for each project they are responsible for.

The takeoff list is then used to develop the cost estimate and the project bid.

The Construction Estimating Process Explained In 9 Steps

When researching construction estimating software, it’s also essential to understand construction estimating and what’s involved in the process.

Below, our experts at SharpeSoft have broken down the construction estimating process into nine easy-to-follow steps.

  1. Commissioning the construction project

  2. Determining construction project requirements

  3. Putting together the design team

  4. Designing the structure

  5. Bidding on the scope of work

  6. Signing the project contract

  7. Construction

  8. Close-out of project

  9. Completion of construction project

Construction Estimating Costs: Understanding The 5 Key Levels

Because construction cost estimates can only be accurate with a sound project plan, it’s standard practice to design multiple estimates during the pre-creation and creation phases. These estimates become more exact as the construction project's level of definition increases.

The American Society of Professional Estimators (ASPE) classifies construction estimates based on a five-level system that becomes more reliable and detailed.

The Five construction estimating levels are as follows:

Level 1: Order of Magnitude Estimate: Created when a project design has not started. An order of magnitude estimate is used only to determine the overall practicality of a construction project.

Level 2: Schematic Design Estimate: A schematic diagram estimate is produced in line with a schematic design for the construction project.

Level 3: Design Development Estimate: An estimated design made during the development stage of a construction project.

Level 4 Construction Document Estimate: A construction estimate based on the construction specifications and drawings for the project.

Level 5: Bid Estimate: A construction estimate prepared by the project contractor based on the construction project documents. The bid estimate is the foundation of the bid price offered to the customer.

Construction Costs Influences

When it comes to determining the costs of a construction project, many factors can influence the total number. These influences vary so widely as cost estimators recognize that every construction project is unique.

Factors that often influence a construction project can include:

  • The building site (natural rock and soil, previous constructions, native animal species, natural heritage sites, geological formations, etc.)

  • Construction site location (transportation of workers and materials)

  • Time-related aspects (project schedules)

  • Fluctuating market conditions and inflation

  • Varying bond amounts

  • The quality of construction plans and specifications

  • Whether there is a government agency funding the project

Finally, all estimating costs add at least a tenth, and sometimes a fifth, of the construction project total to account for contingencies. Construction project contingencies are funds held for any unexpected costs.

What is Construction Estimating Software?

Construction estimating software is a desktop or cloud-based technology developed to organize and improve materials, costs, and labor estimates for construction projects.

Construction estimating softwares come in many varieties, ranging from simple spreadsheet templates to innovative online software with many features designed to optimize the entire estimating process.

Contractors should understand that some software is designed with specific subcontractor trades in mind, including features catered to HVAC contractors or electricians. Other construction estimating softwares are designed for general contractors with no specific trades in mind.

Why is Construction Estimating Software Important?

To put it simply, estimating software is essential because it allows contractors and companies to predict the cost of just about any construction project accurately. This is because the software relies heavily on data backed by facts rather than numbers pushed out by an outdated estimating software.

What Are The Benefits of Construction Estimating Software?

As we’ve mentioned, construction estimating software has grown in popularity in recent years, and it’s clear why. The advantages of having a high-efficient estimating cost solution provides essential value to many levels regarding a construction project.

By adjusting the labor units and estimating installation factors on specific project tasks, a construction estimating software can offer construction businesses a competitive edge. Continue reading below to discover the essential benefits of using construction estimating software.

Construction Project Accuracy

In today's fluctuating economy and highly competitive marketplace, it’s even more critical for businesses to keep track of construction project costs, labor burdens, equipment, material expenditures, and other budget factors.

Estimating software for construction projects provides companies with the tools needed to track valuable data, such as backorders, storage materials, and other issues related to a build.

Construction estimating software allows businesses to identify a job’s most accurate cost, providing cost precision for projects while detecting labor costs and the total amount of materials needed.

Improved Project Management

Another invaluable advantage of using a construction estimating software is that it allows for improved project management. With construction cost estimating solutions, an entire team can align their operations with greater efficiency.

With construction estimating software, project purchases and procurements become more cost-effective, correspondence becomes more cohesive and clear, and tracking items becomes more streamlined.

Construction Project Consistency

When businesses use a construction estimating software system, they’ll create estimates that utilize similar procedures every time. This allows for project consistency across all construction project scopes.

For example, using the same formula, procedures, and estimating tools every time allows businesses to expect their data to be consistent and reliable with every project.

Project Convenience

Keeping track of incurring project expenses regarding equipment, materials, labor, and the overall construction project cost requires constant maintenance. Construction estimating software provides businesses the closest cost estimate for a specific project, allowing for an accurate perspective on any construction project.

The cost estimating software also offers several conveniences with the accuracy it provides. The estimating software systems allow businesses to adjust and communicate projects virtually, further allowing construction teams to project success with ease.

Construction Project Efficiency

A significant advantage of using modern estimating software is the efficiency it delivers. Using innovative software provides an efficient way to process project estimates, track company projects, put out more quotes, win more bids, and dedicate more time to other important business aspects.

By saving valuable time using an updated estimating software, purchasing a professional construction cost estimating software system will be worth the expense in the long run.

Project Integration

Integrating project work with other essential software solutions is a significant advantage. This will enable businesses to streamline their workflows and help reduce data errors and duplications.

Project Procurement

Construction estimating software also helps measure the delivery time of project materials and allows contractors to schedule and manage project labor with greater efficiency. This data outlines what equipment, materials, and labor resources will be needed and helps prevent wasted resources.


Because we live in a time of constant economic change, construction businesses have never needed to be more diligent with keeping records of their project expenditures.

Whether it be for tracking project costs for labor, equipment, or materials, the total cost for any construction project must be monitored. Having an accurate and reliable construction estimating software system is essential for these reasons and many others.

At SharpeSoft, we provide construction management software solutions and have been for over 35 years. Our significant SharpeSoft construction estimating software system allows businesses across the nation to accurately predict project costs with ease.

Are you looking for a trusted construction estimating software system for your company?

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