The work item we are going to analyze
We will analyze a typical work item: “Site-mixed concrete, f’c = 250 kg/cm² (≈ 25 MPa), in foundations, including hauling, placing, vibrating and curing.” The unit of measure is the cubic meter (m³), so the whole analysis is done for 1 m³.
A unit price analysis is always structured the same way: first the direct cost, which is the sum of materials, labor and equipment/tools; and then the unit price, which comes from loading the overhead, financing and profit percentages onto the direct cost. Let’s go block by block.
1. Materials
Each material is figured by multiplying the quantity needed per cubic meter (already including its waste percentage) by its unit cost. For 1 m³ of f’c = 250 concrete batched on site:
- Gray cement: 7.00 bags of 50 kg × $215.00 = $1,505.00
- Sand: 0.520 m³ × $380.00 = $197.60
- Gravel, 3/4": 0.680 m³ × $420.00 = $285.60
- Water: 0.220 m³ × $40.00 = $8.80
- Materials subtotal = $1,997.00 per m³
2. Labor
Labor is not priced per individual worker, but by crew and output rate. First you add up the crew’s cost per shift (using the burdened wage —that is, the base wage adjusted by the labor burden factor, which includes benefits, payroll taxes, social security, year-end bonuses, and so on). Then you divide it by the output rate: how many m³ that crew produces in one shift.
Crew “on-site concrete placing,” cost per shift (8 h):
- 1 mason: $650.00 × labor burden factor 1.55 = $1,007.50
- 2 laborers: 2 × $480.00 × 1.55 = $1,488.00
- Total crew cost per shift = $2,495.50
3. Labor: applying the output rate
The crew above has an output of 4.00 m³ per shift (how much concrete they manage to mix, haul, place and vibrate in a day). The labor cost per m³ is the crew cost divided by that output:
Labor per m³ = $2,495.50 ÷ 4.00 m³ = $623.88 per m³.
The output rate is the figure that moves the price the most: if the crew produced 3 m³ instead of 4, labor would climb to $831.83/m³. That is why it pays to rely on real output rates from past jobs, not on assumptions.
4. Equipment and tools
This is where the equipment used (mixer, vibrator) comes in, plus a small-tools allowance. Equipment is also figured as hourly cost ÷ output, or as rental per shift ÷ output.
- One-bag concrete mixer: rental $450.00/shift ÷ 4.00 m³ = $112.50 per m³
- Concrete vibrator: rental $280.00/shift ÷ 4.00 m³ = $70.00 per m³
- Small tools: 3% of labor = 0.03 × $623.88 = $18.72 per m³
- Equipment and tools subtotal = $201.22 per m³
5. Direct cost and unit price
The direct cost is the sum of the three blocks above:
Materials $1,997.00 + Labor $623.88 + Equipment and tools $201.22 = direct cost $2,822.10 per m³.
On that direct cost the markups that turn cost into a selling price are applied, in cascade. With 15% overhead, 2% financing and 10% profit:
- Direct cost: $2,822.10
- Overhead (15%): $2,822.10 × 1.15 = $3,245.42
- Financing (2%): $3,245.42 × 1.02 = $3,310.32
- Profit (10%): $3,310.32 × 1.10 = $3,641.36
- Unit price ≈ $3,641.36 per m³
How to read the result
The final unit price ($3,641.36/m³) equals the direct cost multiplied by a factor of 1.2903 (1.15 × 1.02 × 1.10). That factor —the markup— is what bundles overhead, financing and profit together; seeing it broken out lets you audit each component.
This same scheme —materials + labor + equipment, then overhead, financing and profit— applies to any work item: a m² of brick wall, a linear meter of tie column or a single inspection box. The inputs, the output rates and the crews change, but the structure of the unit price analysis is identical.