Cost Structure of Direct and Indirect Cost During Pre-Construction Stage in Construction EPC Project of Built Environment in Indonesia

The construction industry in Indonesia has experienced significant growth, particularly in Engineering, Procurement, and Construction (EPC) projects for the built environment. Efficient management of direct and indirect costs during the pre-construction stage is critical for project success, impacting budget adherence, timelines, and quality standards. This research analyzes the cost structure of direct and indirect costs in Indonesian EPC projects, focusing on the pre-construction phase. By comparing cost components across 116 projects in the mining and data center sectors from 2020 to 2024, the study identifies patterns in cost allocation and key factors influencing cost structure, such as project size, location, industry, and remoteness. The findings reveal that medium-scale projects and those in the mining sector demonstrate optimal direct cost efficiency, while projects in remote areas tend to manage indirect costs more effectively. The research highlights the importance of context, specific strategies in cost management and recommends future longitudinal studies to compare pre-construction estimates with actual costs, development of a weighted remote scale index, and detailed investigation of indirect cost components. These insights aim to support better financial planning, resource allocation, and risk mitigation in future EPC projects in Indonesia.