Common Causes of Cost Overruns
Unexpected expenses during site development often result from scope changes, inaccurate estimates, or unforeseen site conditions.
- Poor soil, drainage issues, or utility conflicts can require additional earthwork or redesign
- Material price fluctuations (cement, steel, fuel) can raise construction and infrastructure costs
Risk of Timeline Delays
Delays are common in industrial projects due to dependencies on permits, contractors, or third-party utility agencies.
- Permit processing (zoning, electricity, water, pollution control) can take longer than expected
- Weather conditions, labor shortages, or equipment delivery delays can stall progress
Mitigation Strategies
While these risks are real, they can be reduced with planning, contractual safeguards, and experienced project teams.
- Include a 5% to 10% contingency budget to manage financial overruns
- Build in buffer time in the project schedule for permits and procurement
- Use fixed-price contracts and phased development to limit exposure