Published on 2019-06-17 15:20:15
Reducing Overhead Costs in Your Construction Business
As with any business, regardless of industry, it is important to know when to spend money and when to save it. In construction, it is all too easy for costs to slowly mount. After all, thereâs lots to keep up with; machinery, tools, materials, health and safety and repairs to name but a few.
If you are struggling to reduce your overhead costs, donât worry. Weâve put together 6 top tips to help save your business money.
Review your fleet cost
Every construction business uses heavy-duty vehicles and machinery, itâs a necessity. However, heavy-duty vehicles and machinery are a huge expense. Not only is there the hefty price tag associated with buying them, but also the cost of maintaining them. To reduce costs, you should regularly analyse how your fleet is used. Do this on a vehicle-by-vehicle basis, and then do the same again when it comes to machinery. Ask yourself, are there any lightly used vehicles that you no longer require? Is there any machinery that you donât use on a regular basis? If the answer is yes, then you should consider selling them for profit. This will automatically reduce onsite maintenance costs. Before you go rushing to add to your fleet or purchase new equipment for a new project, find out whether it is cheaper to hire or rent them instead. Often, hiring or renting can be a cost-saving solution in the long run.
Hire multiskilled workers
Hiring multiskilled workers will enable you to do more with less. Adopt a hiring process that recognises when an individual can offer versatility, as this can maximise the productivity of your team. Instead of workers having key tasks in their way, youâll have a team that can quickly eliminate obstacles which stand in the way of completion.
Invest in technology
Investing in something might seem like an odd way to save money, but in some cases it is necessary. Technology is often a purchase that is worthwhile as it can make you more efficient, saving you money and time. For example, technology could help your business to go paperless, which would streamline the admin process. Or, you might choose to invest in estimation software so that you can estimate pricing of time and tooling more accurately at the start of big projects.
Be disciplined when it comes to planning and forecasting
Youâd be annoyed if your workers constantly got their measurements wrong and wasted materials. But how often are budgets and forecasts accurate? Itâs important to put a disciplined planning process in place to ensure that projects are delivered on time and on budget.
Strive for quality first time
Having to re-do work because it wasnât right the first time leads to unexpected costs. It usually leads to late delivery too, leaving stakeholders angry and disappointed. Angry customers lead to a bad reputation and inevitably reduces your ability to win future contracts. Itâs important to exercise quality control and a clearly defined process for delivering high-quality work. If you can instil quality as a philosophy into your workforce by offering incentives, youâll save your business money.
Protect your assets
Construction sites are full of expensive equipment and machinery. You know this, and thieves know this too. Reduce the risk of theft by installing a GPS tracking system in your site machinery and vehicles. GPS tracking systems could stop criminals in their tracks. If not, then the installation of a tracking system also makes it easy to locate stolen vehicles and machinery. This means that you are more likely to be able to reclaim any stolen assets, reducing insurance costs.
If youâre interested in how a tracking system can help to protect your fleet against theft, speak with one of our helpful team on 0161 476 4050to discuss the many benefits of a Phantom Tracking System.