The Definitive Construction Estimating Glossary


by Paul Wheaton
May 13, 2022

Read Time: Less than 10 Mins
Last Modified: March 25, 2024

The world of estimating (the process of calculating the costs of labor and materials to generate a bid) is filled with technicalities, acronyms, and jargon galore.

To help, we’ve put together a Definitive Construction Estimating Glossary to make things a little less complicated.



Association for the Advancement of Cost Engineering (AACE) – A non-profit organization serving the total cost management community. They provide resources to assist in success and growth as well as guidelines for applying estimating principles to project cost estimates.

Arc-Fault Circuit Interrupters (AFCI) – A type of circuit breaker that protects against electrical dangers by cutting the current when it detects heat caused by arcing faults. They are required for all 15- and 20-amp branch circuits making them common cost items in an estimating bid.

Allowance – A value in an estimate used to cover the cost of known yet not fully defined work.

Alternating Currents (AC) – An electrical current that reverses its direction many times per second at regular intervals.

American Society of Professional Estimators (ASPE) – A worldwide professional estimating certification network. An ASPE certification is recognized as the highest form of professional identification for an individual estimator as their training program covers all requirements needed for the profession (requirements such as a valid electrician’s license and the ability to read blueprints).

Auto-count – A digital inventory service that updates a management system with accurate product counts.

Autodesk – A computer program used for designing in 2D and 3D.

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Bid – A contractor-provided offer of a price to a client, committing the contractor to specific work completed within a specific timeframe. A bid generally goes into greater detail than an estimate.

Bid Bond – A written and notarized guarantee secured by a bidder assuring the project owner that the work will be performed according to the terms at which they bid. This is a preliminary note given by all interested bidders and is replaced by a performance bond by the winning bidder once the job is awarded.

Bid Item – A product or service provided by the contractor as part of a construction project.

Bill of Materials – An itemized list of materials needed for each specific end-product of a product or sub-project — for example, think ingredients for a particular recipe.

Bill of Quantities – A list of all the materials required to construct a project or part of a project — for example, think generalized grocery list.

Branch Circuit – A part of the electrical system that originated at the main service panel and feeds electricity throughout the structure.

Break Even Point – The point where your total job cost equals your total revenue. At this point, there is no financial loss nor any financial gain for the company.

British Thermal Unit (BTU) – A unit of heat associated with fuels or energy sources. One BTU is enough heat to raise the temperature of one pound of water by one degree Fahrenheit.

Building Information Model (BIM) – A computer model of a building in 3, 4 or 5 dimensions that can be measured by the point and click of a mouse and modified according to changes in plans. This model may be shared with all interested parties as changes are made.

Budget Estimate – An estimate to determine the approximate costs of a project; generally used to secure funding.


Change Order – A document needed for work that is either added or removed from the original scope or bid.

Computer Aided-Design (AutoCAD) – A software program that optimizes the design process by enabling professionals to create more accurate representations.

Conceptual Estimate – An estimate based on the early planning stages of a project to determine the feasibility or degree of complexity of a plan.

Cost Validation – A professional affirmation that the cost of the materials and labor are consistent with the estimate.

Counts – The actual item totals that are taken from a plan.

Cubic Feet Per Minute (CFM) – The unit of measurement for airflow volume. This is determined by measuring how many cubic feet of air pass by a fixed point or object in one minute.


Direct Current (DC) – An electric current that flows in only one direction.

Deliverables – Any output — product, result, or service — that must be completed to finish a project. Examples include project reports, building permits, proposals and design drawings.

Design Build – A type of project delivery system in which a project is designed and built by the same company.

Detail – An amplified drawing of a smaller area of a project to show the exact elements.

Direct Costs – Costs that can be directly attributed to a specific project. Examples include labor, raw materials and equipment rentals.


Electrical Estimating – Process of determining the expenses associated with the design, installation and wiring of electrical systems in a construction project. May involve assessing factors such as the quantity and type of electrical components (wiring, outlets, switches, panels and fixtures), labor costs, equipment costs and any specialized electrical materials required.

Electrical Load – An electrical component or portion of a circuit that consumes electric power. Examples include electrical appliances and lights inside of a building.

Equal – An alternative to a specified product on a plan, offered because of its equal or better attributes.

Escalation – A safety-net allowance to provide for the escalation of costs during construction as the price of materials may increase over time before the project is completed.

Estimating Software – Computer software built for contractors to estimate construction costs for specific projects.


Feeder – Power lines through which electricity is transmitted in power systems. They are estimated by determining the distance between two points.

Framing – The part of construction that consists of the structure that supports the walls, floors, and roof.


General Conditions – Items and resources needed for a project completion that are not visible in the finished product. Examples include clean-up, garbage removal, job-site storage units and safety.

Ground Fault Circuit Interrupter (GFCI) – A GFCI monitors electrical currents and immediately detects when the current is flowing along an unintended path like water. Once an imbalance is detected, the outlet shuts off to protect against injury.


Home Run – The section of the branch circuit that goes directly from the panel to the first junction point, receptacle box or switch.


Indirect Costs – Costs that are not directly related to production. Examples include administration, personnel, and security costs.

Intermediate Circuit – When three switches are involved in operating one light: two of the switches actually control the light while the middle, intermediate, switch manages the flow of current in between the circuits.


Labor Burden – The additional costs an employer incurs to have employees. Labor burden is an added value on the base wage of the employee. Examples include pension contributions, sick leave and fringe benefits.

Labor Units – The method of estimating total labor costs of a project by measuring the amount of time the installation of material will take. This is calculated by multiplying the labor hourly rate (wage) by the time it takes to complete a single unit of product.

Load Calculation – Electrical load calculations are done to accurately determine how much electricity needs to be serviced to a new building based on the electrical equipment that will be installed. This is determined by adding up the amperage of all fixtures and appliances involved in a project.


Mechanical Estimating – Calculating the costs associated with the design, installation and maintenance of mechanical systems in a building or construction project. This may include heating, ventilation, air conditioning (HVAC) and sometimes fire protection systems and entails assessing the quantity and type of mechanical components, such as HVAC units, pipes, ductwork and fixtures, along with the costs of labor, equipment and materials required for installation.


One-line Drawings – A simplified representation of a complicated three-phase electric power system accomplished by using only one line, representing the conductors, drawn to connect all components.

Overhead – The ongoing expenses of operating a business that can be either fixed (think rent) or variable (think delivery costs). To calculate divide the indirect costs by the direct costs and multiple by 100.


Panel Schedule – A diagram used by electricians or engineers to display information regarding a panel and the circuits connected to the panel along with their corresponding loads.

Performance Bond – A notarized guarantee by the winning bidder that the work will be completed according to the plans and specs. This replaces the bid bond after the job is awarded.

Plumbing Estimating – Projecting expenses associated with the design, installation and maintenance of plumbing systems. This may involve the assessment of factors such as the quantity and type of plumbing components, including pipes, fixtures, valves and other related materials, as well as the costs of labor and equipment needed for installation.

Production Rate – The number of goods that can be produced during a given period-of-time – used as a tool to help estimate the length of time a project will take to complete.

Pounds Per Square Inch (PSI) – A unit of measurement used to determine pressure generally associated with gasses or liquids.


Riser Diagram – A depiction of a system – typically electrical or plumbing- that travels up from one floor to another.

Request for Information (RFI) – A document asking for clarification of a specification related to a project.


SaaS (Software as a Service) – A software model that provides cloud-based access to applications and subscriptions over the internet. Contractors are able to access project-related information remotely regardless of where they are.

Schedule – The timeline of the project, mapping out when work elements are due for completion and the target end date of the project.

Scope – The sum of all the elements in a bid along with their features and requirements.

Specification (spec) – The descriptions of materials, labor, and work involved in a project; excludes any cost.


Takeoff – The counting, measuring, and all other means used to determine the complete bill of materials required for a project or portion of a project.

Total Cost Management – A systematic approach to predict and manage the costs throughout the lifecycle of a project, aiming to control, reduce, and eliminate costs.


Unit of Measure – A quantifiable language used as the standard measurement for associated values that helps communicate the association of an object with the measurement. Examples include inches for length and pounds for weight.

Unit Cost – An estimating approach in which the whole of a project is broken down into individual components. Each of these components are then costed out separately.

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Value Engineering – A systematic approach to save money on a construction project by utilizing a lower cost product that still provides the necessary function.


Work Breakdown Structure – A hierarchical way of organizing the tasks needed to complete a project. The work is broken down into more manageable deliverables. For example, interior services would then break down into plumbing which also breaks down into running water lines and fixture installation.

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