Each year more than 400 million tonnes of materials get delivered to site, with 60 million tonnes going straight to the tip due to over ordering, damage resulting from poor storage or because of inappropriate ordering. That’s a whopping 15% of waste. And that’s just the material element. For every item of material waste, there is the associated cost of the labour handling it.
We all know that a certain amount of construction waste is inevitable, but have you considered exactly how much waste – whether it relates to time, labour or materials – is costing your business? Here’s how project cost management software can help your business to reduce waste and increase margins.
1. Know exactly how much waste your projects are generating & take action
The UK Government has mandated that the construction industry must reduce costs by 33% by 20252. If you can reduce waste on each project by just a few percent, it will help you meet this mandate as well as deliver more profitable projects. If you’re like many contractors who assume a standardised allowance for waste in your pricing but find it hard to know if that figure is accurate, you could benefit significantly from Chalkstring.
Chalkstring enables you to track actual consumption versus tendered measures to establish the true waste for each and every item of material. With each completed project, you can refine the accuracy of your waste allowances. This powerful information enables you to set meaningful and measurable targets for waste reduction business-wide, in line with the Government targets.
2. Manage variations quickly & reduce downtime onsite
Variations are inevitable and are often a good source of additional revenue. However, while the Quantity Surveyor performs the time-consuming task of re-scoping work and recalculating costs, there can be costly downtime onsite as operatives wait for new instruction and materials to arrive. This coupled with the fact that many businesses still handle variations manually – making it hard to produce and distribute the updated information – means that variations are often not as profitable as they should be.
Our project cost management software, Chalkstring, can alleviate this. It saves time by automatically and instantly updating project information to include any revisions. Stored centrally, costs are recalculated accordingly meaning everyone has access to the latest data. Benefit from faster variations, instantly updated material & labour requirements and less downtime.
3. Use only what you order
Doing an accurate take off from a drawing to establish the materials and labour needed, and then preparing quantified orders with correct pricing is very time consuming. It’s often done manually, and with construction projects moving so quickly, Site Managers often order materials based on gut feel, which can result in under or over ordering. Over ordering hits profit margin as materials must be either restocked or disposed of at a cost to the contractor, and under ordering can result in labour onsite billing for downtime.
With Chalkstring, you can avoid this. It automates the ordering process for materials and labour activities based on your actual scope of works and provides an easy way to manage and reconcile orders, deliveries and invoices. It also provides accurate breakdowns of what materials are required in each zone, enabling the procurement teams to only order what they need to suit the project programme.
4. Ensure deliveries don’t cost more than they should
Deliveries should be simple, but they can result in the double and triple handling of materials, increasing labour costs and wasting time. If contractors don’t have accurate delivery and distribution schedules that are communicated to the labourers and logistics teams, materials can be distributed to the wrong place. This results in operatives wasting time going back and forth to get supplies, delaying the completion of the job. Or worse, having to hire plant to move the materials to the correct site location, reducing profit margin.
You can reduce this wastage with Chalkstring. It stores all order and delivery information centrally, and creates a delivery schedule detailing and itemising exactly which material from a bulk delivery should be transported to each location around the project. Materials are then distributed correctly – get it right first time.
5. Avoid your most expensive staff doing manual tasks
When people consider waste in construction they typically think of material waste, yet lack of productivity and inefficiency at a staff level is also waste and can have a huge impact on profit margin.
Without a centralised system for managing cost, often the most expensive people in the business spend time doing essential tasks, manually. This could be a Director collating information from multiple spreadsheets and systems to create the monthly board pack, a Quantity Surveyor compiling applications for payment using numerous spreadsheets, or a Site Manager manually creating take offs and writing material orders. All these tasks could be automated using software.
Chalkstring provides a single, integrated system for managing project financials, from estimating to final account. It replaces manual data collation processes and ensures all the critical project information is available in real-time. It boosts productivity thus enabling a business to do more with the same or less resource.
Corporate Real Estate Asset Management: Strategy and Implementation – http://bit.ly/2yEWgxb2
HM Industrial Strategy: government and industry in partnership