How to make more money on your building projects for no more effort
Tuesday, May 31st, 2022
Want to make more money on your building projects? Then buckle up – I’ve got a hefty list of must-dos (and an easier way to do them):
- Job costs
- Build stages
- Build Programme and analysis
If you don’t think your spreadsheet is up to it, we’d highly recommend using estimating software like ours. I’d challenge you to be able to do what took our developers months and months, and hundreds of thousands of pounds… They’ve loaded a mammoth number of costs and built hundreds of estimating calculators to arrive at EstimatorXpress.
But what happens if you don’t use the software and don’t get it all right? You risk dipping into your own pocket to cover the shortfall on things like the:
- Materials and plant you didn’t price
- Materials that got wasted
- Prices you were under on
- Time you didn’t allow for
- Hours you wasted
- Tools that broke or went walkies
- Subbies rates that went up
- Financial buffer you didn’t give yourself…
And in the process, your profit will be eaten away day by day until there’s barely anything left or nothing at all. You won’t make more money on your building projects if you miscalculate and make errors. That’s the bottomline.
The worst thing – you might not even notice on an individual job. Because all the money going in and out of the bank account starts merging with other projects.
The only way to make more money than you are now with no more effort (if you use EstimatorXpress!) is to…
Fully cover all the job costs
- Plant hire
We’re talking every last brick tie and tube of mastic. Every single hour of employed and sub-contracted labour – and your time as well. You don’t come free! Plus every single bit of kit that it will take to complete the job.
If you’re working off an old price list you’re in trouble. If you don’t even start with accurate material prices, you’re done for. At the time of writing, inflation is currently running at 9%. So if you start the job in say nine months’ time then your estimate needs to reflect the costs at that time – you could be thousands of pounds down otherwise. Thank goodness for the EstimatorXpress Inflation Calculator!
Price every single build stage
- Site set-up
- Ground floor joists
- Oversite and slabbing
- …Internal fitting out
- Internal decoration
- External decoration
As I mentioned there are hundreds of estimating calculators in the software. Once you’ve described the job you’re estimating, the software automatically gives you the relevant calculators to work with.
- Wear and tear
I’ve already touched on inflation. Getting the estimate right is a real percentages game. We’ve hosted many talks on the subject of overheads and inflation so they’re worth checking out. We also provide an overheads template and cashflow template to help you cover off all your outgoings and keep on top of money going in and out.
Above all else, make sure you allow for a decent profit – and if you don’t think you can charge it – then perhaps it’s time to re-evaluate the kind of jobs you go after. More on that here.
Protect your profit with rock solid project management
- Order schedule
- Cost Report
- Build Programme
- Cashflow analysis
- Profit forecasts…
So say you’ve been brilliant at accurately costing everything and then still have nothing to show for it. What could have gone wrong? 9 times of 10 it will be poor project management. Of course problems occur. Yes supplies get delayed. The weather could be bad. It just means you need to be really on your game.
The ‘live’ build programme in EstimatorXpress will allow you to move a build stage along and all the resulting changes will cascade accordingly. Used properly your build programme will make sure everyone and everything are in the right place on the right day.
And with the automatically produced material list supplied by EstimatorXpress you can negotiate the best price and secure your deliveries early doors. And I should finish by mentioning the software’s clever on-screen dashboard. It will tell you how you’re doing on each job – what’s profitable and what’s not, and loads more.
So how confident are you in your own estimating?
The order book is full. The invoices going out to customers are bigger than they’ve ever been. But these could be false flags. Everything is costing more money so your invoices are bound to be larger. But what is left for you? Very little I’d say – unless you’re putting 20-30% profit on each job, are using the very latest material prices, covering every single cost associated with the job, building in inflation, allowing for all the ‘hidden costs’ like van insurance, loan repayments etc etc. You need to make more money on your building projects.
So what next? Too busy to learn new software?
Ok so you don’t want to get to grips with a software programme… but think of the bigger picture. If you want real financial security then what’s a few hours at the laptop? Plus it’s way easier than you realise! And there are many reasons for going digital, we suggest five to the FMB.
Make more money on your building projects
Once you’ve (easily) mastered the software you’ll reap the long-term rewards. Call us on 0117 916 7898. Book a short online demonstration and we’ll give you a quick tour of your future – a more financially secure one…