Recent reports that the construction industry is suffering an ongoing slump is a real concern for the UK. And, with the slowest rise in housebuilding since 2013 now apparent, the industry is looking for ways to cut costs. When you can’t make money on new projects, it’s essential to maximize your profits on the jobs you get. So, here are several ways that construction firms up and down the country are protecting their bottom line.
Better waste management
Waste management can be an expensive business in the construction industry. Every time a firm visits a dump to drop off refuse, it comes at a cost. Of course, that expense can be passed down to the customer, but this impacts a firm’s ability to offer competitive pricing. It’s essential, then, that construction companies can prepare robust waste management strategies. And, most importantly, put them in action!
Part of that waste management plan should include the recycling of construction materials. But, it’s such a money saver that it is worth mentioning on its own. Materials are expensive to buy new, and if firms are collecting unused bricks and wood, it can help them build up extra stock, and that’s why the construction industry is trying with other materials as mdf boards, as now you can buy mdf cut to size which are perfect for different types of projects. The extra bags of concrete you ordered from a Ready-Mixed Concrete Delivery company may also be used in future projects as long as they’re stored properly. Again, this can help them offer their customers much better value, and be in a stronger position against the competition.
Logistics plays an important part of the construction industry, and there are many costs to consider. Transportation is an obvious example, but there is also site management to consider, too. In addition, Portable Water Storage Tanks and other utilities or services will be needed in construction sites. With many more firms going national, it’s not unusual for companies from the north to work down south, and vice versa. There can be a lot of waste when teams are in hotels or bed and breakfasts, and transportation costs can be enormous. So, companies have to address their issues with a proper logistics plan to cover all their bases.
There is a delicate balance between quick work and safe work, and all construction firms need to hit the right notes. Work too slowly, and jobs will take too long. But, do the job too fast, and there is more likelihood they will have to return to make fixes. Neither are suitable for protecting the profits on each job, so it’s easy to see why that balance is essential.
Use of new technology
All kinds of industries are enjoying the cost-saving benefits of technology. It’s no different with construction. A good example is the advent of 3D printing. One day in the future, perhaps, builders will be able to construct entire houses with the flick of a switch. While that is a possible future, for now, they can enjoy cutting costs. 3D printing means that ordering concrete for building work can take just a few hours, rather than the standard few weeks. This will help builders work quicker, and price their jobs in a much more efficient way. Take a look at our article here for some more interesting ways that the construction industry is using technology.
Building Information Modelling
Building Information Modelling – or BIM – is an important development for the construction trade. Most construction projects run over budget, and the effect can be severe. Customers may not be able to afford to finish the project if something big gets in the way, for example. So, using software beforehand is a wise move. BIM helps cost projects much more accurately, and this can be an enormous benefit for clients and firms alike. For the customer, it means they can enjoy the process a lot more with far less worry about blowing their budget. And, as is always the case, firms that come in within the original budget can become popular beyond belief. Check here for more info on BIM – http://www.autodesk.co.uk/.
Safer construction sites
Construction sites are extremely dangerous places. Although there have been great strides in Health and Safety regulations, accidents are still on the rise. This is costly for the firms involved, even when they are not at fault. So, wiser firms are investing in more thorough training programs for workers, and improving safety around sites.
As construction firms grow and take on more jobs, it makes sense to buy plant machinery and heavy equipment spare parts. These can be an expensive investment, especially when buying new. However, those costs are far less than hiring equipment per job. And, when you consider the burgeoning second-hand market, there are serious savings to be made. Take a look here for some examples – www.sjhallplant.com. The primary benefit of buying over hiring is that you can spread the cost to the customer over several different jobs. One client isn’t paying for the whole hiring charge, which, on big jobs, can rise to a significant amount. This allows firms to charge less for their services and get a bigger cut of the market.
The construction industry is often used as an example of exploiting cheap labour from abroad. However, while this practice does occur, in the vast majority of cases it makes sense. Foreign workers from the EU and beyond have brought a discipline and productivity to the industry, and offer a lot more for their money, So, in many cases, it’s more they are working harder and doing a better job, than working for a lower wage.
Tracking global trends
Bright construction firms are making themselves more aware of the global markets. And, they are beginning to understand the impact they can have. This means they can be more flexible with what they offer, and provide services that are on trend rather than stagnating. A typical example of this is the green building industry. It’s a growing sector across the world, and offering environmentally sound practices is becoming a lot more popular. Many people are choosing green firms these days rather than more traditional construction companies. And, given that most people who hold an interest in these issues are wealthy, there is always business deals to strike.
OK, so there you have it – some of the interesting ways the construction industry is cutting its costs in 2016. Technology and best practices are, as usual, at the heart of the developments. And, if the industry continues to decay, it will be ever more important for construction firms to make the real savings.