Project Management

5 Types of Project Cost [Infographic]

From the The Money Files Blog
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A blog that looks at all aspects of project and program finances from budgets, estimating and accounting to getting a pay rise and managing contracts. Written by Elizabeth Harrin from GirlsGuideToPM.com.

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There are different types of project cost – your budget isn’t made up of one big lump of cash. Although it can sometimes feel like that!

Understanding the different types of project cost is helpful because they help you review the different categories of spend. You can use mindmapping to check that you haven’t left out any budget items.

The infographic below shares the 5 different types of project costs that you should consider for your budget. However, what it doesn’t make clear is that the project cost categories overlap. You can have fixed direct costs and variable indirect costs, for example. Sunk costs remain sunk!

Within the different categories you can break down your budget even further. For example, cost of quality might be something you consider for your budget formulation, but it could be a fixed, variable, direct or indirect cost, depending on how you are going to build quality into your project.

Posted on: October 22, 2018 08:59 AM | Permalink

Comments (8)

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Very interesting, thanks for sharing

Very nice graphic, thanks for sharing!

Hi Elizabeth, thanks for sharing this. We normally call the Indirect Cost as Overhead Cost.

In Construction, we do normally have two main types of Cost: Direct & Indirect. The rest goes under those two main categories (ie. Variable, Sunk and Fixed Costs). For example, variable cost of staff could be direct or indirect cost and the same goes for equipment and other things so I am not sure I fully agree that the budget consists of 5 categories of costs. In my humble opinion, it consists of two main Cost categories and then subcategories under those two main categories.

Elizabeth, thanks for sharing excellent information on different costs.

Good graphic!!!

Excellent infographic to use as a reference for the project cost.

Thank you for sharing! I worked in some organizations that called Indirect Cost as Overhead as Rami noted before

Hi Elizabeth, this is an excellent infographic. Thank you.

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