Many construction firms today contend with increasingly narrow margins and many more difficulties associated with boosting productivity. In a heavily saturated market, estimated to be worth 12.7 Trillion US Dollars globally by 2022, construction software is fast becoming vital to achieving a competitive advantage.
McKinsey Global’s 2017 study estimates that the implementation of digital technologies across the construction sector would result in a 14-15% improvement to the industry’s productivity.
This article will detail our top three ways that job costing software can improve your profits and increase growth, allowing your business to stay competitive.
Improved Estimating Accuracy
Probably the most obvious of ways job costing software can increase profits, being able to breakdown all costs associated with a project, enabling you to more accurately estimate. New projects happen in various phases, meaning each phase may have several associated costs such as labour, materials, equipment etc. By using job costing software, you gain the ability to truly understand these costs on a project basis and ensure you never take on a project which results in you losing money.
Increase Growth & Reduce Risk
Construction firms today operate in a risky landscape with extremely tight profit margins. As a result, many firms keep their bids moderate. The concept being that a £10,000 loss is better than a £100,000 loss. Modern construction software enables you to ensure that every new project increases profits. You may not win as many contracts, but accurate quotes, with a time-saving bid process, allows you to bid for more jobs with the peace of mind that your numbers are correct.
Business Intelligence & More Accurate Future Quoting
Business Intelligence is becoming increasingly more important in many B2B software packages today and construction software is no different. Over time, as you accurately cost projects with the software, you can gain major insights into both profits and overheads, even at the task level. This information not only allows you to improve the accuracy of your quoting in the future, by comparing estimates with actual figures, but also allows you to see which areas are the most profitable. For example, you may find your firm isn’t particularly competitive on groundwork but IS for electrical labour.
Construction job costing software is fast becoming a necessary investment for competitive construction firms trying to increase profits and operate effectively in a tight industry. As previously discussed, construction software grants you a wide-range of benefits including accurate job costing, correctly allocated costs, business intelligence etc. All these factors contribute greatly to reducing risk throughout the business, allowing you to focus on the bottom line; improving profits.
Written by Sam McDonald