CONSTRUCTION

EQUIPMENT
MANAGEMENT
CONTENT

 Introduction

 Factors behind the selection of construction

equipments

 Types of construction equipments

 Selection criteria for various construction

equipment

 Plant and equipment acquisition

Introduction
Good project management in construction must vigorously pursue the
efficient utilization of labor, material and equipment.
The use of new equipment and innovative methods has made possible
wholesale changes in construction technologies in recent decades.
The selection of the appropriate type and size of construction equipment
often affects the required amount of time and effort and thus the job-site
productivity of a project.
It is therefore important for site managers and construction planners to
be familiar with the characteristics of the major types of equipment most
commonly used in construction.
 Advantages of utilizing the construction
equipments:

 Increase the rate of output through work progress with the

best effective and efficient methods.
 Reduce the overall construction costs especially for large
contracts.
 Carry out activities which cannot be done manually or to do
them more economically and much faster.
 Eliminate the heavy manual work by human thus reducing
fatigue and eliminates various other hazards and health issues.
 Maintain the planned rate of production where there is a
shortage of skilled or unskilled labor.
 Maintain the high quality standards often required by present-
day design and specifications (technical standards).
 FACTORS BEHIND THE SELECTION
OF CONSTRUCTION EQUIPMENTS
 Economic Considerations
 Company-Specific
 Site-Specific
 Equipment-Specific
 Client And Project-Specific
 Manufacturer-Specific
 Labour Consideration
Economic Considerations

The economic considerations such as

owning costs, operating labour costs
and operating fuel costs of equipment
are most important in selection of
equipment.
Besides, the resale value, the
replacement costs of existing
equipment, and the salvage value
associated with the equipment are
also important.
Company-Specific

The selection of equipment by a

company maybe governed by its policy
on 'owning' or 'renting’.
While emphasis on 'owning' may result
in purchase of equipment keeping in
mind the future requirement of
projects, the emphasis on 'renting' may
lead to putting too much focus on
short-term benefits.
Site-Specific
Site conditions-both ground conditions as well
as climatic conditions-may affect the
equipment-selection decision.
For example, the soil and profile of a site may
dictate whether to go for a crawler-mounted
equipment or a wheel-mounted equipment. If
there is a power line at or in the vicinity of
site, one may go for a fixed-base kind of
equipment rather than a mobile kind of
equipment.
Equipment-Specific
Construction equipments come with high price
tags. While it may be tempting to go for the
equipment with low initial price, it is
preferable to opt for standard equipments.
Such equipments are manufactured in large
numbers by the manufacturers, and their spare
parts are easily available, which would ensure
minimum downtime. Besides, they can also
fetch good salvage money at the time of their
disposal.
Client And Project-Specific
The owner/client in a certain project may
have certain preferences that are not in line
with the construction company's preferred
policies as far as equipment procurement is
concerned.
The schedule, quality and safety requirements
demanded of a particular project may in some
cases force the company to yield to the
demands of the client.
manufacturer-Specific

A construction company may prefer to buy

equipment from the same manufacturer again
and again, and that too from a specific dealer.
This may be to bring in uniformity in the
equipment fleet possessed by the company or
because the company is familiar with the
working style of the manufacturer and the
dealer.
Labour Consideration

Shortage of manpower in some

situations may lead to a decision in
favour of procuring equipment that
is highly automated.
Further, the selection of equipment
may be governed by the availability
or non-availability of trained
manpower.
TYPES OF CONSTRUCTION
EQUIPMENTS AND THEIR
SELECTION
 EARTHWORKCRITERIA
EQUIPMENTS

 CONCRETING EQUIPMENTS

 HOISTING EQUIPMENTS
TYPES OF EARTHWORK
EQUIPMENTS
 Backhoe
 Roller compactor
 Front shovel
 Scraper
 Dragline
 Dumper
 Clamshell

 Dozers
 Grader
Backhoe
Backhoes are
mainly used to
clean up
construction areas,
to dig holes in the
ground, to smooth
uneven ground, to
make trenches,
ditches and to help
remove deep roots
from trees.
Front shovel

Front shovel are

mainly used for
excavation purposes
above its own track or
wheel level.
They are suitable for
heavy positive cutting
in all types of dry
soils.
Dragline

They are used

for bulk
excavation
below its track
level in loose
soils, marshy
land and areas
containing
water.
Clamshell

It consists of a
hydraulically controlled
bucket suspended from a
lifting arm. It is mainly
used for deep confined
cutting in pits and
trenches.
Dozers

They are used for

moving earth up to a
distance of about
100m and act as a
towing tractor and
pusher to scraper
machines. They can
be track-mounted or
wheel-mounted.
Roller compactor
Roller compactor is mainly used to for compaction of earth
and other materials in large works of highways, canals and
airports.
Scraper

They are used for site levelling, loading, hauling

over distances varying between 150m-900m. They
may be towed, two-axle or three-axle type.
Dumper

It is used for
horizontal
transportation of
materials on and off
sites. Large capacity
dumpers are used in
mines and quarries.
Grader

It is used for grading

and finishing the
upper surface of the
earthern formations
and embankments.
They usually
operate in the
forward direction.
SELECTION CRITERIA FOR
EARTHWORK EQUIPMENTS

The selection of earthmoving equipment is mainly

dependent on the following factors:
 Quantities of material to be moved
 The available time to complete the work the job
conditions
 The prevailing soil types, the swell and compaction
factors, etc.
 The job conditions include factors such as availability
of loading and dumping area, accessibility of site,
traffic flows and weather conditions at site.
 In order to plan the number of Earthwork
Equipment needed, the planner first determines
the following:

 The suitable class of equipment for earthwork-for example,

if the soil to be excavated is loose and marshy, and bulk
excavation is involved In the project, one may opt for a
dragline.
 The appropriate model of equipment based on different
characteristics such as payload of bucket and speeds
required. For example, draglines come in different
capacities ranging from 0.38 cum to 3.06 cum; scrapers in
capacities ranging from 8 cum to 50 cum and so on.
 The number of equipment needed for the project to carry
out the given quantity.
 The number of associated equipment required to
support the main equipment
TYPES OF CONCRETING
EQUIPMENTS
 Concrete batching and mixing plant

 Concrete mixers

 Concrete transit mixers

 Concrete pumps
Concrete batching and mixing plant

They are mainly used

for weighing and
mixing large quantity
of concrete
constituents.
capacity:-
20cum/hr-250cum/hr
Concrete mixers

They are mainly used for

mixing
small quantities of concrete
constituents.
capacity:-
200lt/batch (small mixers)
200-750l/batch (large
mixers)
Concrete transit mixers

They are mainly

used for
transporting
concrete from
batching point.
capacity:-
3cum-9cum
Concrete pumps

They are used for

horizontal and vertical
transportation of large
volumes of concrete in
short duration.
capacity:-
30cum/hr (ordinary
construction)
120cum/hr(specialized
construction)
SELECTION CRITERIA FOR
CONCRETING EQUIPMENTS
Selection of concreting equipment can be complicated and
difficult. The decision will involve many issues that have to
be analysed. The following factors are noteworthy:

 Site characteristics such as boundary conditions, noise

limitations and other restrictions.
 Equipment availability-local availability of equipments,
whether the contractor owns that equipment
 Continuity of operation
 Effect of permanent work
 Weather conditions
 Temporary works
 Time restrictions
 Concrete specifications
 Concrete-mixing equipment selection will depend on factors such as the

 maximum and the total output required in a given time frame

 the method of transporting the mixed concrete

 the requirement of discharge height of the mixer.

 Concrete-placement equipment selection
depends on factors such as the

 capacity of the vehicle

 the output of the vehicle
 the site characteristics
 the weather conditions
 the rental costs, and the temporary haul
roads.
HOISTING EQUIPMENTS

It constitutes a group of equipment which are

employed mainly for lifting or lowering of unit load
and other . This group of equipment’s can be
further sub classified into:

1. Hoists 2. Cranes
Boom hoists Derrick Crane
Chain hoists Mobile Crane
Electric hoists Tower Crane
Tractor hoists
Boom Hoist
Boom hoists are used to
lift weights on the hooks
that are attached to the
special metal ropes
designed to bear
maximum loads.
Boom hoist is mostly
used as industrial
machine where it loads
the weight on
containers.
Chain Hoist

Chain hoists are quite

common example of hoist
system and it can be seen at
most of the construction and
industrial purposes. Basically,
chain hoist consists of chain
rope and pulley that is used
to move the load from up to
down.
Electric Hoist

Electric hoist is modernized

form of chain and boom hoist
mostly used in the industries for
fast working.
It is very much popular in
material handling industries
because it saves labor costs by
handling maximum loads at a
time with no damage threats.
 Tractor Hoist

Tractor hoist
consist of a boom
that is attached
with base of tractor
and a hook with
rope is installed on
this boom that can
operated through
driver controls.
CRANES

Cranes are considered to be one of the most

important equipment used in construction due to their
key role in performing lifting tasks all over the
construction site.
Plenty of crane models are available in different
shapes
and sizes, though, they usually fall into three
categories,
1. Derrick Cranes
2. Mobile Cranes
3. Tower Cranes
SELECTION OF CRANES
Factors affecting the selection of cranes are—

1.Building Design 4.Economy

Cost of move in, setup, and move out
Building Height
Cost for rent
Project Duration Productivity

2.Capability 5.Site Conditions

Power Supply Soil Stability and Ground Conditions

Access road requirement and site

Load lifting frequency
accessibility
Operators Visibility
Operating Clearance

3.Safety
Mobile Cranes

 Adequate for all types of structures (up to 107 m)

 Used for shorter projects duration (less than 4 months).

 Not considered to be very safe due to lack of safety devices or limited switches
prevent overloading.

 Can operate in muddy terrain but requires good ground conditions.

 Needs adequate operating clearance.

Mobile Cranes
Tower Cranes

 Preferable for high-rise (over 107 m).

 Used for longer project duration.

 Considered to be very safe due to the presence of limit switches.

 Can operate where ground conditions are poor.

 Does not need adequate operating clearance.

Tower Cranes
Derrick Cranes

 Preferable for high-rise and apartment buildings.

 Can be used for both long term and short term projects.

 Cheaper than mobile and tower cranes.

 Not considered to be safe.

 Used when clearance is inadequate for the other units and sufficient space is
unavailable for the erection of a tower foundation.
Derrick Cranes
Plant and equipment
A construction company can acquire a
acquisition
construction plant and equipment through
 Cash or outright purchase

 Renting

 Leasing
When It’s Best to Buy

Buying or financing equipment is most sensible

if the equipment is essential to your core fleet
and expected to provide reliable service for a
long time.
If you decide it's worth the large outlay of
funds to buy or finance equipment, you'll find
owning equipment can provide long-term tax
benefits--principally from deduction of interest
expense and depreciation of equipment.
 When It’s Best to Rent
Renting entails a short-term agreement or contract to
use capital equipment weekly or monthly, with the
rental rate decreasing as the term lengthens.
Following are some other popular reasons for renting
equipment:

• To fill in for peak periods, special projects, or broken

machinery
• To try out equipment before buying or leasing it
• To lessen the risk of purchasing costly equipment that
won’t be needed later
When It’s Best to Lease

Leasing can be an attractive option if

you use the equipment frequently but
don’t have the resources to purchase
equipment outright or make an
adequate down payment.
However, leasing carries higher
interest rates and contractors usually
are responsible for the insurance and
personal property taxes on the
equipment being leased.
CONTENTs

 Introduction to Cost of Owning and

Operating Construction Equipment
 Ownership cost
 Operating cost
 Effect of Depreciation & tax on
selection of alternatives
 Equipment life & Replacement
Alternatives
 Conclusion
INTRODUCTION

The Plant, equipment and tools used in

construction operations are priced in the following
three categories
1. Small tools and consumables
2. Equipment usually shared by a number of work
activities
3. Equipment used for specific tasks
Total equipment cost comprises two separate
components
 Ownership cost
 Operating cost
OWNERSHIP COST

Ownership costs are fixed costs. Almost all of these

costs are annual in nature and include:

 Initial Cost

 Depreciation

 Investment Cost

 Insurance Tax and Storage Cost

Initial cost

On an average, initial cost makes up about 25% of

the total cost invested during the equipment’s
useful life. This cost is incurred for getting
equipment into contractor’s yard, or construction
site, and having the equipment ready for
operation. Many kinds of ownership and operating
costs are calculated using initial cost as a basis,
and normally this cost can be calculated
accurately. Initial cost consists of the following
items:

 Price at Factory + extra equipment + sales tax

 Cost of shipping
 Cost of assembly and erection
Depreciation

The decline in market value of a piece of equipment

due to age, wear, deterioration and obsolescence.
Depreciation can result from:
 Physical deterioration occurring from wear and tear of the
machine
 Economic decline or obsolescence occurring over the passage of
time

In the appraisal of depreciation, some factors are

explicit while other factors have to be estimated.
Generally the asset costs are known which include:
 Initial cost
 Useful life
 Salvage value
Depreciation

How ever, there is always some uncertainty

about the exact length of the useful life of the
asset and about the precise amount of salvage
value, which will be realized when the asset is
disposed. The Depreciation methods are

 Straight line method

 Sum of year digit method

 Sinking fund method

 Declining balance method

Straight line method

It is the simplest to understand as it makes the

basis assumption that the equipment will lose the
same amount of value in every year of its useful
life until it reaches its salvage value. The
depreciation in a given year can be expressed by
the following equation
D n = (C – S) / N

Where Dn = Depreciation in year n

C = The initial cost
S = The salvage value
N = The useful life (years)
Sum of year digit method

It tries to model depreciation that actual market

value of a piece of equipment after 1year is less
than the amount predicted by SL method. Thus
more annual depreciation in the early years of a
machine’s life and less in its later years. The
depreciation in a given year can be expressed by
the following equation
D n = (year n digit) * (C – S) / ∑N

Where Dn = Depreciation in year n

year n digit = The reverse order
C = The initial cost
S = The salvage value
N = The useful life (years)
Declining balance method

The depreciation for a given year is calculated

on the basis of the undepreciated balance
(instantaneous book value), rather than the
original cost. Further the method does not take
into account any salvage value of the asset. The
factor can be determined using simple interest
formula and also special tables developed for the
purpose.
D = (M/N) * BV BV = BV - D
n n-1 n n-1 n

Where Dn = Depreciation in year n

M = constant (Generally 2)
N = The useful life (years)
BVn-1 = Opening book value at year n
Sinking fund method

The method works in terms of a “sinking fund

factor”, which is determined on the basis of the
initial and salvage values of the asset, the service
life and rate of (compound) interest. The factor
can be determined using simple interest formula
and also special tables developed for the
purpose.
D = (C – S ) * f
n

Where Dn = Depreciation in year n

C = The initial cost
S = The salvage value
f = sinking fund factor
N = The useful life (years)
Investment cost

Investment (or interest) cost represents the

annual cost (converted into an hourly cost) of
capital invested in a machine. If borrowed
funds are utilized for purchasing a piece of
equipment, the investment cost is simply the
interest charged on these funds. If it is
purchased with company assets, an interest
rate that is equal to the rate of return on
company investment should be charged.
Insurance tax and storage costs

Insurance cost represents the cost incurred

due to fire, theft, accident and liability
insurance for the equipment.
Tax cost represents the cost of property tax
and licenses for the equipment.
Storage cost includes the cost of rent and
maintenance for equipment storage yards, the
wages of guards and employees involved in
moving equipment in and out of storage, and
associated direct overhead.
Total ownership cost

The total equipment ownership cost is

calculated as the sum of depreciation,
investment cost, insurance cost, tax and
storage cost.
This should expressed as an hourly cost and
used for estimating and for charging equipment
cost to projects, it does not include job
overhead or profit. Therefore if the equipment
is to be rented to others, profit should include
to obtain an hourly rental rate.
Operating COST

Ownership costs are also called “variable” cost. Because they depend on
several factors such as the number of operating hours, the types of
equipment used, and the location and working condition of the operation.

 Maintenance & Repair cost

 Tire cost
 Consumable cost
 Mobilization & Demobilization cost
 Equipment Operator cost
 Special Items cost
The effect of depreciation and tax on
selection of alternatives
The effect of depreciation and taxes is key
factor on selection of alternative equipments.
Equipment life and
replacement alternatives
Once a piece of equipment is purchased and
used, it eventually begins to wear out and
suffers mechanical problems. At some point, it
reaches the end of its useful life and must be
replaced. The Equipment replacement decision
involves determining when it is no longer
economically feasible to repair.
 Equipment Life
 Replacement alternatives
Equipment life

Construction equipment life can be defined in three ways.

 Physical life:
Age at which the machine worn out and can no longer reliably produce.

 Profit life:
The life over which the equipment can earn a profit.

 Economic life:
Time period that maximizes the profit over the equipment life.
Replacement alternatives

The owners have to take replacement decision

in correct time to avoid losses. As there are
many factors involved, adopting the most
appropriate method is also important. In
determining the optimum replacement timing
some analysis minimum cost, maximum profit
and payback period are to be consider.
conclusion

The selection of the appropriate type and size

of construction equipment and its operation,
maintenance affects the required amount of
time and effort and thus the job-site
productivity of a project.
It is therefore important for site managers and
construction planners to be familiar with the
characteristics of the major types of equipment
most commonly used in construction.