An investigation into factors influencing construction costs based on Japanese, UK and US contractor practice

Construction cost is a major concern to both clients and contractors. Based on a hypothetical construction project (a six-storey concrete framed office building), cost and other related information was collected through a survey of contractors in Japan, the UK and the US. Using multiple regression analysis it was found that lower overheads, less prefabricated components, and fewer design variations could reduce construction cost. Overheads largely represent indirect costs to contractors and if reduced can lead to increased profit levels and improved competitiveness. The use of prefabricated components may be problematic where there are delays in production, insufficient coordination between design and construction, and congested transportation on site. Design variations during construction bring about uncertainties and are disruptive to the construction process. These factors have paramount impact on construction cost and demand close attention and consideration. Contractors are advised to reduce the costs of their overheads and utilise prefabrication appropriately, while clients and designers should minimise the number of design variations during construction if better cost performance is desired.