Managing Construction Industry Costs

construction industry costs

Some think ROI (return on investment) is something big-time investors analyze. But when goods and services expenses seem out of control, ROI can make or break an investment decision.

It doesn’t matter if you are “only” spending a few thousand. Your money-back or money-saved needs to be proportionate to your business. Managing fixed and variable construction industry costs helps form the foundation for company success.

Every business software company says its program will save money. You’ll spend less time, enjoy added convenience, reduce error risks, and improve — well, you’ve heard it all by now. Seriously, most of it is true.

Finding a software service provider is another thing altogether; every company has different needs. Assignar offers ROI numbers that provide examples of how its software investment can combat rising construction industry costs and pay for itself.

A heavy equipment investment in 2021 showed a six-year ROI of 4.73% and a 9.27% profit margin.

  • Ownership costs
    • Depreciation
    • Payments plus insurance, interest, taxes
  • Operating costs
    • Maintenance/repairs
    • Operator wages
    • Parts/supplies

In 2022, construction industry costs increased:

  • Equipment operators ↑ 5%
  • Fuel ↑ 40%
  • Operating expenses ↑ 15%
  • Ownership costs ↑ 10%

Leading to average:

  • ROI ↓ 5.26%
  • Profit margin ↓ 11.34%

You have several improvement options:

  • Equipment utilization – Under- and over-utilization of equipment are equally bad for bottom lines. You need to be able to visualize real-time productivity and asset utilization.
  • Resource management – Up-to-date maintenance and certifications can lessen unexpected work stoppages. You need at-a-glance capabilities for seeing if the right people and resources are in the right place at the right time.

You must be prepared to tackle the current construction business challenges head-on, and you can’t do that if you don’t have the information you need now. Real-time information saves money and makes money. For business development leads from real-time building permit data, contact Construction Monitor.

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Our blog is for informational purposes. We don’t endorse nor recommend any software brand.

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