Rising costs can impact every industry; however, the construction industry experiences more of an accelerated rate of inflation compared to the great majority of public and private sectors. Rising labor, equipment, and material costs can turn a healthy profit into a devastating loss for a construction business. It’s important to evaluate the market, utilize forward-thinking strategies, and discover cost-effective solutions to reduce the impact of these rising construction costs.
In the first and second sections of this four-part article, we discussed the soaring prices that both labor and material costs are currently experiencing. In the third section and this final section, our Lakeland construction attorneys are offering construction professionals advice on ways they can cut costs to ensure they meet their financial goals during times of surging construction costs. Remember, if you are need of knowledgeable and experienced legal counsel, please speak with a Lakeland construction attorney today.
Spend Money on What Matters
Many construction companies try to cut corners by investing their money in lesser quality tools. Although it’s always important to consider where you can cut costs, it’s a necessary expense to invest in tools that will save your project time and can be relied on to get the job done. It’s also important to keep an itemized list of all the tools along with implementing an inventory system that keeps track of where the tools were distributed to as well. Sometimes management loses sight of these basic things and thousands of dollars are lost on projects thanks to theft and poor management.
The Art of Ordering
The biggest wasted expense on a project is in materials. Whether it’s buying too much and wasting some of the purchase or not buying enough and waiting around for the delivery or simply not having the right materials in the right place at the right time, it’s important to remember that the materials purchased makeup around 40 percent of the project’s budget. If you are looking to save expenses in certain areas, take the ordering process seriously and always closely evaluate where your project is at in this regard.
Coordinating the Project
An effective team doesn’t happen by accident. From the design stages to the building process, contractors need to be constantly analyzing ways they can be productive and save costs. From scheduling the workers in shifts that do not promote idle time to keeping track of weather patterns to considering potential delay threats to numerous other issues that directly influence productivity, the contractor that is prepared will always be the most productive and find creative ways to reduce construction costs.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.