How to Become a Cost Estimator and Achieve Success

When a business launches a new product or service, each part of the project has its own costs. Whether it’s the raw materials to create new products or internal software for the team, someone needs to oversee exactly how much everything costs.

That someone is a cost estimator. If you have a knack for numbers and statistics, this role can become a lucrative career that makes use of your mathematical and analytical skills while helping businesses grow.

The information that cost estimators collect when working directly with suppliers helps senior executives bid and negotiate the best prices for their materials and resources. They play an essential role in budget creation and management for individual projects using cost estimation software, giving teams the data needed to determine whether their work is financially feasible.

Why projects need a cost estimator

Any new project sounds like a good idea until you start working out the financials. There’s a reason that 54% of manufacturing projects end up costing more than originally projected. Without accurate estimates, budgets can easily get out of hand.

Working with a cost estimator keeps projects on schedule and on budget. The estimates come with a number of benefits, including:

• Improved profit margins. Various factors affect the final cost of a project, particularly if it stretches over a long time. The longer a project takes, the more subject it is to costly obstacles like inflation or staff changes. But with accurate estimates, you can plan for some of these unexpected issues and help project profit margins stay on track.
• More accurate forecasting and planning. Being able to plan ahead helps keep projects within scope and allows teams to manage their resources more efficiently.
• Enhanced resource management. When you know what you need to see a project through to completion, you can prepare better for different needs. For example, being able to identify skill or resource gaps upfront gives managers time to hire and train new employees to fill in those gaps.
• Stronger vendor relationships. Cost estimators work closely with suppliers to determine accurate projections for material costs. When the estimates are accurate, more trust develops between client and vendor, resulting in more effective working relationships.

How to become a cost estimator

There’s no one right way to become a cost estimator. Before heading off to college, it’s a good idea to think about the industry you’d like to work in first, as this can help you determine the type of degree you want to get.

Degrees for cost estimators

For those interested in working in construction, Bachelor’s degrees in majors like construction science, engineering, or construction management can all be a great starting point. However, manufacturing companies also look for majors in business-related fields such as accounting, finance, economics, and mathematics, as well as some courses in physical sciences.

The goal of your degree should be to provide you with some of the critical skills that you can take into your first professional experiences as a cost estimator. Practical skills like mathematics and analytics are essential, but so are “soft skills” like communication, attention to detail, and critical thinking. 

It is possible to work as a cost estimator without a degree, but working your way up from an entry-level position takes longer. Having experience in the construction industry in particular, can be a good alternative to traditional education. But without extensive work experience or a relevant degree, it’s more difficult to find work in this field. Typically, those who become cost estimators without a degree are transitioning into this work from a similar industry with many years of practical experience behind them.

Types of cost estimator jobs

The industry you’re working in usually determines the type of job you end up with as a cost estimator. Some of the most common ones are:

• Cost analyst or estimating coordinator. These are the most entry-level positions for cost estimators. At this level, you work under senior estimators to learn about gathering data as you prepare estimates for small projects on your own.
• Project cost estimator. Moving into a mid-career position brings more responsibility for your own projects. You should have a solid foundation of skills by this point and be able to take on estimates for a project throughout its entire lifecycle.
• Lead or senior cost estimator. At the senior level, you understand project estimates in detail. You may also be responsible for overseeing the work of juniors once you reach this point.
• Cost control manager. Director-level positions focus on the big picture. These individuals have a deep understanding of risk assessment, project management, and financial forecasting.
• Chief estimation officer or VP of estimation. Moving up to an executive role takes you out of day-to-day estimation work. The concentration here is on strategic financial planning that aligns projects with company goals at a higher level. These positions also involve a level of influence when it comes to decision-making.

How much does a cost estimator make?

The industry you choose to work in and the level you aspire to reach determine the salary that you can expect to make as a cost estimator. The average salary nationwide in 2022 was $71,200.

Top construction cost estimating software

As a cost estimator, you rely heavily on technology to keep track of your estimates and make accurate forecasts for each project. Using specialized cost estimating software, like those for the construction industry, is one of the best ways to do this.

To be included in the construction cost estimating category, platforms must:

• Generate accurate estimates, bill of quantities (BoQs), or takeoffs for potential construction projects 
• Digitize quantities 
• Generate or offer templates for bids, proposals, cost reports, or other types of project cost documentation 
• Facilitate markups of line items, proposals, and customer or job site information 
• Offer or provide access to cost databases

* Below are the top five leading construction estimating software solutions from G2’s Winter 2024 Grid Report. Some reviews may be edited for clarity.

1. Procore

Procore construction software helps teams manage projects, resources, and finances related to construction projects. This tool connects project contributors to technology solutions built specifically for construction industry professionals, like the owner, the general contractor, and the specialty contractor.

What users like best:

“The features, updates, and new features constantly being added, and how well it works without constant issues are what sets Procore apart from other softwares. Once set up, it is user-friendly and just an all around easy way to keep track of your projects from start to finish. Also, the ability to collaborate with architects/owners/subs is extremely helpful and included in the cost.”

- Procore Review, Christina H.

What users dislike:

“You can't bulk edit status. I think it would be helpful to have a bar chart on observations and the ability to assign it to more than one person.”

- Procore Review, Jason H.

2. Autodesk Construction Cloud

Autodesk Construction Cloud connects teams with data and workflows across all areas of each construction project to minimize risk, improve efficiency, and increase profit margins. Autodesk gives users a broad set of field execution and project management tools in a single software platform that is easy to deploy, adopt, and use. 

What users like best:

“Autodesk is continuously adding new features to help improve productivity and communication on projects. The design collaboration module is a fantastic tool for project managers to review the design during the project without requiring prior knowledge.”

- Autodesk Review, Rick H.

What users dislike:

“Their account and project administration is quite complex. I have to go through many options to just create my project and set it up along with assigning roles, and the weird thing is that I have to assign myself roles for every product I use under Construction Cloud, like Docs, Build, etc.”

- Autodesk Review, Aashrut V.

3. Trimble Accubid Classic

Trimble Accubid Classic allows contractors to assemble and manage bids, helping them put together comprehensive databases of materials and labor costs. This tool offers a comprehensive material and labor database of over 40,000 items.

What users like best:

“It is very easy to add items and assemblies that fit our needs. I have been adding to and modifying our database for 18 years and I am still not using 50% of its capacity. I also like the integration with Live Count that has allowed my estimating department to go completely paperless. No more plans cluttering up the workspace.”

- Trimble Accubid Classic Review, Randy M.

What users dislike:

“The user interface can be unforgiving. Many features could be entirely unknown without extraordinary training. Discoverability and features need a great overhaul to meet the standards that a more tech savvy generation has come to expect.”

- Trimble Accubid Classic Review, Garrett G.

4. Knowify

As a project management and cost platform, Knowify is built specifically for trade contractors to keep projects, teams, and finances efficiently organized. It makes it easy for users to track projects and invoice clients in one place.

What users like best:

“It offers many features to stay organized with invoicing, bills, scheduling, and many other things contractors need to be on top of to remain profitable. This will change how your contracting business is run, and you will find yourself using the software daily.”

- Knowify Review, Cristian B.

What users dislike:

“From the accounting side (and being a company in California) one of my biggest complaints is sales tax tracking. I know this is not an issue for every company or every industry.”

- Knowify Review, Casey B.

5. PlanSwift

PlanSwift is a top takeoff and estimating software that lets estimators improve their accuracy for any project. It’s an easy-to-use visual point-and-click interface, so that users can measure linears, unit counts, square footage, pitches, and angles in seconds with one click. 

What users like best:

“The main thing I like about it is there are tons of added plug-ins that are trade-specific. This helps streamline the takeoff process if there is a specific style a company would normally perform.”

- PlanSwift Review, Ashley B.

What users dislike:

“Learning curve on this software is long. Also, collaboration between users can be a pain. I would need to email my file to another user and sometimes the files would be sent missing items or not even sent. The cost per user is also a little steep.”

- PlanSwift Review, Jaime R.

Estimating for excellence

The role of a cost estimator is one of the most important in a range of industries. It’s a big responsibility. After all, it’s on you to decide whether a project is financially viable or not. But for analytical individuals with an eye for numbers, this can be a great career choice.

Learn the ropes of construction and manufacturing project management with manufacturing intelligence software that helps you gather and analyze data from multiple sources.