Construction is big business in the U.S., building $1.3 trillion worth of structures every year. But when it comes to profitability, companies averaged a gross margin of around 19% through the first three quarters of 2018.
Can that figure be increased? It’s possible.
You already know how to run a successful construction company. But do you know how to ensure successful construction project management?
We’ve got five tips that will help you streamline your business to keep your costs low and your profit margins high.
1. Successful Construction Project Management Starts with a Plan
Every great plan starts with open communication. From the onset, make sure you’re in constant communication with the project’s architect.
You also need to communicate with your team leaders. Find out who they’re delegating tasks to when you get to the site.
Of course, your client’s input is important as well. Be as transparent with them as possible so they’re aware of every step. If they’d like changes, your crew can implement them before they get too deep into the original plans.
Plan a huddle meeting with the project leaders every morning. Go over what the expectations are for the day.
At the end of the shift, huddle up again to discuss the day’s progress. If you’re running two shifts, make sure there’s some overlap. This ensures both shift leaders can discuss what’s completed and what still needs to get done.
Finally, be open with your leadership about the project’s budget. If they know where everything needs to be, it helps them manage crews and supplies better.
2. Set a Hard Date for Customer Changes
Construction is a fluid industry. There are outside factors that affect the budget like weather, late deliveries, and crew attendance. But nothing can throw off a timeline like client changes.
Of course, you want them to be happy. But, they have to understand that a deadline for making changes is necessary for the flow of the project.
3. Look into Material Costs
“Waste not, want not” is an unofficial motto of the construction industry. Streamlining costs helps to keep everything on budget. Review your material costs for everything from concrete and cement to personal safety protection for your crew.
Try to figure out if there’s somewhere you can trim fat. This saves times but it can also save money.
If your project involves something your crew isn’t efficient in, consider going with prefab materials. Sometimes it’s worth spending some money on things that can help get your project running smoother.
For example, building pipe racks takes time and labor you can’t afford to spend. Instead, read more here about using a prefabricated modular system.
4. Ask Questions, Listen to Feedback
Observe your site and ask questions when they arise. That 60 seconds could save you thousands of wasted dollars and hours.
Always seek feedback from your ground crew. Do they have an idea for a process that will make things run smoother? Do they have any concerns about the plans? Do they foresee any hiccups to the day’s expectations?
A good project manager in construction has the ability to weed out legitimate concerns from simple complaints.
5. Automate Your Systems
Consider turning to integrated automation. This cuts down on the time spent using several different programs and getting the reports at the end of the day.
An automated system allows your leadership to report back progress, materials used, labor, inventory — every aspect of the job site. And it’s accessible in real-time.
It’s a way to keep tabs on every facet of the site with a few clicks of a mouse. There will be some initial outlay, but having an automated system pays for itself in a short amount of time.
Never Stop Planning
In the construction industry, you can never stop planning. The first step in avoiding a delay or wasted money is efficient construction project management is key. It will keep your processes flowing and the lines of communication open.
For more tips on keeping your construction business running smooth, read more on our blog.