Progressing on a construction project without the right planning would make you lose money or even eventually empty your pocket. The industry operates on such razor-thin margins making the slightest changes lead to losing money. Let’s see some reasons why the total cost of the project exceeds the estimated budget.
1. Poor contract negotiation
Improper contract negotiation can ruin the project even before the beginning. The contractors should specify the work’s scope within the prescribed budget. The work to be done in the prescribed timeframe, the dos and don’ts of the project without any financial penalties are to be specified. Choosing the right contractor takes off half the stress of the project from your shoulders. A contractor of expertise will respect your budget and plan accordingly. The best is when your contractor can bring the highest project outcome at a lower cost. Also, contractors who abide by the rules and regulations are committed to not violating safety precautions on site. They will take action prioritizing the safety of everyone at the project site.
2. Ineffective project management
From the commencement of the project to its completion, it is to be made sure every activity is done as per the project plan. Many potential risks might come such as unnecessary delays, cost blow-outs, and time wastage during the progress of a construction project.The project supervisor/manager has to be vigilant in overseeing all aspects of a project. He/she should manage the project budget and onsite labours, establish project goals and objectives, and also monitor and report the progress. The following factors might affect the project undesirably:
· Poor planning and coordination of workers
· Poor material management
· Poor labour management
3. Quality and productivity issues
Inferior project quality will end up in site issues and wastage of money. Dedication from the contractor’s and workers’ sides is sure to influence the outcome of the project. Quality issues make increased costs to rectify the work and delayed project timelines.Quality issues also have the potential to create safety risks for workers and the public, leading to legal complications. Compromised quality further affects the practicality of the project. There comes the need for quality control and management. Quality control is pivotal in realizing the essential goals of the project. Quality control by project management consultancy measures are to be implemented in any construction project to ensure it approaches the highest standards with the right and best-performing labour and equipment. Quality assurance will make sure everything sticks to the requirements throughout the course of the project.
4. Material issues
The complications regarding the availability and improper usage of materials are the most common source of cost hikes in construction activity. The contractors find it hard to deal with such aspects. Either the material costs increased during the process of construction or the materials have been wasted due to improper storage. Even theft is a potential reason to halt the project process. Material issues pave way for increased project completion costs and late delivery, quality issues etc. Appropriate material selection will benefit the overall quality of the project. Cost, climate tolerance, durability, availability, sustainability, maintenance, aesthetic appeal and performance are the key factors to be noted in material selection. Reach out to the best supplier for negotiation. Understand your mission and business priorities, their business and one have to be authentic to build credibility. Construction tends to deal with the same suppliers for a long time, so it is necessary to recognize the context negotiation takes place. If an ongoing relationship, negotiation strategies have to be crafted considering it.
5. Time management in construction
Not completing the project on time is also a source of an exponential rise in the cost of completion. Completing the project on time strictly by the project guidelines requires proper planning and implementation. Tasks have to be scheduled, the task list to be prioritized, actionable meetings have to be conducted to report the project progress, and tasks and roles to be assigned with clear and precise communication. Time management tools are being used in construction to ensure every onsite activity falls into place. A construction management software is a timesaver acting as a central resource for project information and communication. It lets all team members view and contribute information on projects, as all have complete visibility of project progress. Tasks will be assigned with allotted time for each to complete with the status reports to be published. Everyday jobs, plans, and deadlines can be created, managed, and growth be tracked. Such software is also the best for organized communication. Automation in construction is a time saver and productivity enhancer at the same time. Ontime/ahead of time completion of the project is realized such a way. Completing the project ahead of time will make you save from the estimated budget.
Working with a construction project management consultancy completely eases off the process of construction with improved efficiency, cost reduction, quality check, and completion of the project on/before time (no delays). PMC is a budget-friendly construction method ensuring the best possible outcome for the project. Buildit PMC is the leading Project Management Consultancy in Kerala making the construction management simple and time driven, overseeing it from conception to completion. Reach out to Buildit with your project management queries.
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