How to Save Money in the Construction Industry

How to Save Money in Construction

construction workers at lunchAs construction output is forecasted to drop by 3.9% in 2023, construction companies face a rocky road ahead. Many will be looking to make efficiencies across the board in order to avoid insolvency.

With a worrying time ahead, construction ERP software provider RedSky has curated a list of ways that efficiencies can be made at construction companies.



1. Think ‘Quality’

In 2018, the CITB identified that over £21bn was lost annually on rectifying mistakes made during construction. Their Get It Right Initiative now focuses on eliminating error in the construction process.

With such a staggering amount lost to rectifying errors, focusing efforts on reducing issues made by putting quality at the heart of everything you do is highly important. It’s common to see viral social media videos of new builds with copious building errors or hear horror stories of snags not being resolved. However, issues don’t just apply to new builds. Across the construction industry, thinking “quality” is a great way to save money in the long term.

2. Boost ProductivityConstruction site at night

From clear communication to strategic planning, there are numerous ways you can boost productivity in construction. It is important to remember that despite this, you cannot put productivity ahead of quality.

There is a fine line to tread between productive and low quality, but it’s one where the balance must be kept.

With productivity, a focus on automating manual processes can help. For example, looking at automating payroll, invoice registers and even employee onboarding can help to save hours spent on simple manual tasks, such as data entry or process management.

3. Connect Your Systems (Interoperability)

Construction companies can sometimes use legacy software that may not best serve their needs in today’s fast-moving world of technology. There may be features missing or even a lack of updates that could be holding you back!

By using modern systems that can connect with other software that you use, you gain improved productivity through modern software enabling you to remove duplicate entry work. Connected systems via the use of open standards are what customers expect, whether its processing legislative data such as CIS / RCT / VAT / Pension or Payroll or, driving interoperability targets to meet the information management requirements under ISO 19650 led by the various groups as part of the Government & Industry Interoperability Group (GIIG) Task Force

4. Be Proactive with Change Requests

Any construction project will be no stranger to change requests. This could come from a product being withdrawn, the client changing their preferences or even a change in industry law.

When change requests are made, it’s important that quantity surveyors and project managers not only give a cost estimate for the change itself, but also an impact report on how much this will cost to adjust work and progress.

As regular change requests can be a drain on resources and time, it’s important that each of these changes are tracked to ensure that money is not being lost. Money is often lost due to last minute requests, as these changes pull people off planned work to make amends, which can’t always be billed.

5. Digitise Quantity Surveyor Estimations

Quantity surveyors are reliant on accurate and up to date information to be able to do their jobs properly. One of the easiest ways to supply this is through digital information.

If you’ve got digital information, another simple way to reduce paperwork and administrative costs is to digitise the estimation and wider quantity surveyor process too. This will ensure that information is more accurate, delivered promptly and are accessible across a company.

While this may not speed up much time for the quantity surveyor, the accessibility and accuracy of information creates efficiencies across the business.

6. Consolidate your Supply ChainConstruction workers using software

There’s currently a trend in construction to spend more with fewer suppliers, agreeing a yearly rebate. This is beneficial for both the supply chain and construction companies, as it creates smoother invoicing for the construction company and potentially guaranteed income for the supply chain.

While this will cost a similar amount for products and hire, the savings here are made through lowered overheads of invoice processing and the potential of yearly rebates to go straight to the bottom line. With fewer supply chain companies to deal with comes the reduced overhead of processing volumes and with a combination of a fully integrated procure to pay solution this will allow your business to grow easily.

7. Boost Visibility in Construction

Under the Building Safety Act, visibility in decision making and processes is becoming of paramount importance. Soon, companies will have to demonstrate a clear thread of information, such as design and material choices, across the business, especially when working on high rise buildings.

A construction software solution such as RedSky’s ERP can help you to increase information visibility. While the initial time investment of digitally recording work can be higher than previous methods, the cost of non-compliance is often much greater.

Discover how RedSky’s ERP can help you to boost efficiency

We’re aware of the challenges facing the construction industry and know that our software will prove a valuable investment for you and your team. Our team of experts will help to personalise our software for you.