What is Overhead?

Overhead in the context of construction refers to the indirect costs that are incurred during the building process. This includes expenses such as insurance, utilities, salaries for office staff, and equipment maintenance. These costs are necessary for the operation of the construction project but do not directly contribute to the physical construction of the building. Overhead costs are typically calculated as a percentage of the total project cost and are added on top of direct costs such as labor and materials.Managing overhead costs is crucial in the construction industry as they can significantly impact the profitability of a project. Contractors must carefully track and analyze overhead expenses to ensure that they are within budget and do not exceed the allocated amount. By effectively managing overhead, construction companies can improve their bottom line and remain competitive in the