No one likes to lose money

Whether a company is a new startup venture providing marketing consulting services or an established manufacturer of custom-built motorcycles, knowing how to job cost—that is, knowing how much it costs to produce an individual product—is critical if a company is to generate a profit. As the following article shows, Mortenson | Clark knows this all too well.

Job Costing and the New Golden State Warriors Arena^*

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Mortenson | Clark was responsible for costing, pricing, and constructing the new home of Steph Curry and the Golden State Warriors, the Chase Center in San Francisco. Completed in 2019, the $1.2 billion state-of-the-art arena anchors a new development featuring restaurants, cafes, two office towers, public plazas, and a new public waterfront park along San Francisco Bay.

To construct the Chase Center, Mortenson | Clark managers used historical data and marketplace information to carefully estimate all costs associated with the project: direct costs, indirect costs, and general administrative costs. Direct costs included the 9,000 tons of structural steel, 100,000 cubic yards of concrete, and 450 construction workers per day required for construction. Indirect costs included the cost of supervisory labor, company-owned equipment, and safety equipment. Finally, general administrative costs allocated to the Chase Center project included office rent, utilities, and insurance.

Throughout the 3-year construction process, job costing was critical as onsite managers reported on the status of the new arena. Managers used a 200-page monthly “playbook” to identify potential problems with the project and took corrective action to ensure the Chase Center was delivered within the original project budget and on time to start the 2019–2020 NBA season.