There was a comedienne whose catchphrase was, “It’s always something.” We are cautiously optimistic that the pandemic will be something we can someday tell our grandchildren about. But you might need to take your mask off to blow-up balloons today because the construction industry is dealing with inflation.
9 Ways To Manage Your Construction Industry Business During Inflation
Long-term trends ranging from high housing demand to tight labor markets will probably fuel inflation well into 2023 even if the pandemic, and short-term price pressures caused by it, begin to fade…-Construction Dive
There are several strategies for your construction industry company to employ as you struggle with inflationary prices and economic downturns resulting from it. Some are just common sense approaches for any business. Some are construction industry-specific approaches to manage inflation:
- Consider implementing commodity tracking logs.
- Differentiate between strategic and nonstrategic spending.
- Don’t prioritize low bidding over quality work.
- Implement TVD (target value delivery). TVD is a management practice used during every phase to deliver fixed-budget projects while meeting the client’s operational requirements.
- Integrate skilled trades early in a project; pay them quickly.
- Lock-in material prices earlier and leverage warehousing.
- Partner with companies that are knowledgeable about global markets.
- Scrutinize work processes and trim them. Eliminate unnecessary work and automate where possible.
- Take communications to an even higher level. Misunderstandings will cost more now than ever.
Conference Board Global Chief Economist Dana Peterson said transitioning to renewable energy, immigration restrictions, and returning production to the U.S. will also drive inflation. Incentives that may reduce inflation include:
- Enhanced infrastructure
- Improved efficiency
- Increased automation
- More remote/contract work
- Retailer price competition
National and global economics will always impact the construction industry. And Construction Monitor data analysis based on building permit information will always increase construction business marketing leads if you know how to use it. Ask us what’s in it for you and your company: Contact Construction Monitor.