It’s no secret that construction project rarely go as planned. Accidents, bad weather, faulty equipment and other factors can delay or even derail a project that leads to unprofitable work.
The tips below will help you creating better cost estimates when budgeting for a project, which will make both you and your customers happier.
1. Connect with an expert and review past projects
Learning from past projects and analyzing what they did well and what could have been done better will help you more efficiently plan your current projects.
You will be able to see approximately how long a project could take and create a timeline to help account for labor costs. You can also see past budgets and make changes to yours accordingly.
2. Conduct a risk analysis
Try to determine any possible roadblocks the project might face before you actually start it.
It’s best to plan for worse case scenarios and include possible delays that might happen in your schedule. As changes on the work site occur, keep the analysis up to date on any hazards that were presented.
You won’t be able to account for every possible problem, but anticipating major hurdles can go a long way towards making sure your project is profitable.
3. Create goals
Goals help segment projects into smaller tasks, which helps you understand how each task impacts the project overall.
When scheduling, keep in mind how different milestones will impact the project as a whole. If one part doesn’t get completed on time, what effects might it have on the project as a whole?
Goals will also give you clarity on important decisions that will need to be made along the way.
4. Look at key performance indicators
After a project is completed, it’s important to account for actual costs, cost variance, earned value, and return on investment. This will help make planning future projects (see the first item in this post) even more effective.
You can compare your actual costs to the budget that you originally planned for and start to get a sense of where discrepancies are coming from. That will be your cost variance.
Keeping track of your earned value (what you’ve achieved so far compared to what you should have achieved, given the budget and resources you’ve expended) as you go along is essential.
Your return on investment will (obviously) tell you if you made a profit or a deficit on the project.
ExakTime can help you collect valuable data on all of your construction projects. Simply run a report on a project anytime during or after it’s completed. You can see the total labor hours expended, as well as how many employee hours were spent on a given day.
From 100% accurate labor cost data to our convenient Field Notes feature that lets your employees and supervisors record project progress, you’ll be making better project cost estimates in no time.
Contact ExakTime today to learn more.