Estimate project costs with labor, materials, subcontractors, and overhead using bottom-up, top-down, or parametric methods.
The Project Cost Estimator builds a project cost from the four categories most budgets actually run through: labor, materials, subcontractors, and overhead. You can work bottom-up, summing the cost of each work item; top-down, starting from a total budget and working backward; or parametrically, scaling a unit rate by quantity. What surprises most users is how quickly the result starts to look exact. The number is only as good as the inputs, and an estimate is a range with assumptions attached, not a firm quote.
A concrete input and expected output from the current implementation.
Input
Bottom-up method. Labor: $5,000 (100 hours at $50/hour). Materials: $2,400. Subcontractor: $1,800. Overhead: $700.
Expected output
Labor: $5,000. Materials: $2,400. Subcontractor: $1,800. Overhead: $700. Total project cost: $9,900.
Labor is 100 hours times $50 per hour, which is $5,000. With overhead entered as a fixed amount, the total is the plain sum of the four entries: 5,000 + 2,400 + 1,800 + 700 = 9,900.
Bottom-up sums the cost of individual work items: labor hours at a rate, materials at quoted prices, subcontractor bids, then overhead on top. Top-down starts from a fixed total and works backward to see what each category can absorb. Parametric multiplies a unit rate by a quantity, for example dollars per square foot times square footage, which makes it fast when past projects give you a credible rate.
Overhead is the indirect cost of running the work: supervision, equipment, facilities, insurance. When it is entered as a percentage, the base it multiplies matters: overhead on labor alone is not the same as overhead on all direct costs. The classic mistake is double counting. If a labor rate or a subcontractor bid already includes overhead, adding a separate overhead line charges it twice. Check what your rates include before entering them.
Because they answer different questions. Bottom-up says what the work should cost when every line is priced; top-down says what a fixed budget can absorb. A gap between them is not an error, it is the finding: either the scope exceeds the budget, or the budget has slack. Decide which before choosing a number to carry forward.
Contingency is money for what is still unknown, and it is normally added as a separate line rather than buried inside a category. A common starting range is 5 to 20 percent of the estimate, higher when inputs are early-stage. The tool totals what you enter; it cannot judge how uncertain your inputs are. Put contingency where you can see and remove it.
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