Software avoids need to predict the future
Thursday, September 01st, 2016
No one can predict the future but as the economy’s fortunes improve one thing for certain is that the cost of building materials will continue to rise as demand outstrips supply.
The issue for many builders however is working out how much these costs will go up from the time they provide a quote to when they start ordering and working on site.
In some cases this can be as long as six months (possibly longer) and when for instance the cost of blocks and walling goes up by five per cent, plastic and drainage up by 8 per cent, wet trades and drylining 4 per cent within the same time frame shows the dilemma builders face when it comes to managing their margins.
The rise in material costs is backed by figures from the Office of National Statistics taken from October 2015 with bricks costing 5.5 per cent more than a year ago and pre cast blocks and bricks up 4.9 per cent.
Another consideration that many builders fail to factor is the use of out-of-date price lists to quote for jobs in the first place which then magnifies further the potential loss of profit.
Solutions are however available which not only use the most up-to-date prices but which factors future inflation. It means the quotes provided in the first instance are totally correct giving the client a true and accurate idea on the expense of a project from the very beginning.
One of the leading solutions on the market is HBXL’s EstimatorXpress which has not only been developed by builders who know what it takes to get a job done but downloads material prices daily.
It means when a quote is created, it’s done with the prices that are right up-to-the-minute. This ensures the customer gets a true cost and the builder makes the best possible profit on the job.
The software also includes tools that will automatically account for any inflationary pressures on material prices, so that by the time the builder goes to order means their margins will be intact.
With more and more builders turning to software to help run their business, exposes those who reply on more traditional methods such as square metres to provide their estimates.
And those who quote low just to win the job means in all likelihood they will have to go back cap in hand asking for more budget or making less profit – not the ideal situation.
Joanna Mulgrew, product development director at HBXL explains: “More and more builders are moving towards a way of working that is consumer and service focused, rather than just price. Part of that philosophy means the estimates they produce truly reflects the prices of the day.
“A lot more builders are also realising that it doesn’t pay to quote low in the first place and those that do are only fooling themselves.
“Aside from inventing a time machine this is by far the best way to protect profits. It ensures the customer gets a true cost and the builder doesn’t lose out.
“It also helps builders ensure the right materials are on site at the right time as it automatically produces material schedules. This helps ensure the build programme is kept on track, on time and on budget.”
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