Planning for project costs is a key part of running a construction business. When you’re operating under slim margins, unnecessary spending could mean the difference between turning a profit or barely breaking even. Thankfully, there are many ways that contractors can save money during the project management and building phases, whether you’re doing carpentry work, masonry, or any other part of the construction.
Here are six ways your construction business could save money during projects:
1. Work with the architect
A cost-effective design can help decrease your expenses before a project even begins. Working closely with the architect could help minimise costly changes being made during construction. It also allows you to suggest affordable building materials before groundbreaking.
2. Comparison shop
No matter what materials are being used, shopping around may help you lower your costs. Small savings on materials and equipment can add up and help you stay at or under budget. You may have a roster of suppliers that you regularly work with, but it’s smart to keep an eye on their competitors. Your suppliers might be willing to price match or offer a discount.
3. Invest in quality tools
Cheap tools and equipment might save you money upfront, but they could end up costing you in the long run. You may end up wasting money and time sorting out replacements, repairs, or loans if the cheaper option breaks. Investing in quality equipment from the beginning could help you avoid these dramas and potentially have tools you can carry over to future jobs.
4. Inventory your equipment
Tools and equipment can easily go missing on a job site. To help prevent loss and theft, create an inventory of your assets and require your employees to sign them out and in after each use. Using an app or shared document for this task could give you real-time updates on where your tools and equipment are each day.
5. Reduce waste materials
Jobs rarely go to plan, so contractors typically order extra materials to avoid delays or increased prices. However, overordering is wasteful and can unnecessarily increase your budget. Carefully calculate how much of each material is needed and order a reasonable amount of extra on top of that.
6. Schedule smart
Construction expenses can also be increased by wasted labor. Effectively scheduling your crew can help ensure that the right people are on site each day. To do this, you may need to consider the weather, each employee’s work speed, project delays, and other events that can impact the project timeline.
Building a profitable business
Controlling costs is an essential part of running a construction business. As a contractor, you must weigh many factors when budgeting for a project. Finding savings, wherever you can, could help you make money in construction and build a more profitable business.
Contractor insurance could help you protect your small business. Compare and buy policies online with BizInsure in minutes and see if you could save money on contractor business insurance—start now!
