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Construction glossary

What is a Cost Overrun?

A cost overrun, in the context of the construction industry, refers to the excess amount that needs to be spent over the initially agreed or budgeted cost for completing a particular project. It’s an unanticipated increase in costs that occurs due to various factors such as inaccurate estimation, changes in project scope, unforeseen challenges, or increase in material or labor costs. In essence, it’s when the actual cost of the project exceeds the estimated cost. It is critical to manage and minimize cost overruns as they can seriously impact the overall profitability and success of a construction project. Effective project management, regular monitoring, vigilant control measures, and contingency planning are some strategies to mitigate such cost overruns in construction projects.

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Other construction terms

Payroll

What is Payroll?

Payroll, in the context of the construction industry, refers to the process by which a company pays its employees for their services performed within a specified pay period. It involves determining ea...
Preliminary Notices

What are Preliminary Notices?

Preliminary Notices are legal documents that are commonly used in the construction industry. These notices are also known as pre-lien notices or notices to owner. They are typically sent at the beginn...
Required Document

What is a Required Document?

A Required Document in the context of the construction industry refers to any official paperwork or digital file necessary for carrying out a construction project according to legal and professional s...

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