In order to determine the rate of a particular item, the factors affecting the rate of that item are studied carefully and then finally a rate is decided for that item. This process of determining the rates of an item is termed as analysis of rates or rate analysis.

analysis of rates

The rate of particular item of work depends on the following:

1. Specifications of works and material about their quality, proportion and constructional operation method.

2. Quantity of materials and their costs.

3. Cost of labours and their wages.

4. Location of site of work and the distances from source and conveyance charges.

5. Overhead and establishment charges

6. Profit

Cost of materials at source and at site of construction:

The costs of materials are taken as delivered at site inclusive of the transport local taxes and other charges.

Purpose of Analysis of rates:

Purpose of Analysis of rates:

1. To work out the actual cost of per unit of the items.

2. To work out the economical use of materials and processes in completing the particulars item.

3. To work out the cost of extra items which are not provided in the contract bond, but are to be done as per the directions of the department.

4. To revise the schedule of rates due to increase in the cost of material and labour or due to change in technique.

Cost of labour -types of labour, standard schedule of rates:

The labour can be classified in to

1) Skilled – 1st class

2) Skilled – 2d Class

3) Unskilled

The labour charges can be obtained from the standard schedule of rates 30% of the skilled labour provided in the data may be taken as Ist class, remaining 70% as II class. The rates of materials for Government works are fixed by the superintendent Engineer for his circle every year and approved by the Board of Chief Engineers. These rates are incorporated in the standard schedule of rates.

Lead statement: The distance between the source of availability of material and construction site is known as “Lead ” and is expected in Km. The cost of conveyance of material depends on lead.

This statement will give the total cost of materials per unit item. It includes first cost, conveyance loading, unloading stacking, charges etc.

The rate shown in the lead statement are for metalled road and include loading and staking charges. The environment lead on the metalled roads are arrived by multiplying by a factor.

a) For metal tracks – Lead x 1.0

b) For cartze tracks – Lead x 1.1

c) For Sandy tracks – Lead x 1.4


  1. Good Morning All,
    The Rate analysis is simple and clear. But the main problem in rate analysis is, for Government projects the rate from Standard schedule of rates is ok, but for private works or projects its not possible.
    For example:

    The Class-I mason wages as per Karnataka state Irrigation department standard schedule rates is Rs. 224/day, but in Bangalore city we are paying Rs.600/day. For plumber it is Rs 216.50/day but actually we are paying Rs.800/day.

    Please consider this huge variation too while doing rate analysis.

  2. it is worthy and useful article . The rates of labour of Govt is to be considered for dept tenders is must. but for other is optional. Govt also has its own yard sticks to be ascertained for estimate of cost. However the authoe has commendable effort has been put .Thanks

  3. For the good analysis of rates the main thing is to use the accurate man hours, machine hours, Consumables etc. which may required to execute the work.
    The Remaining Factors e.g. Material can be calculated easily.
    Similarly the rates difference between Market and Government Journals can also be compared easily.

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