When Every Dollar Counts
The economic downturn has only heightened the need for contractors to look for ways to save money and increase revenues. A top-to-bottom review of your operations may reveal some surprising areas where significant savings can be found.
Use More Efficiently
Fuel is probably a major expense for you, especially if you are involved in road, bridge, and other types of heavy construction. You can reduce fuel consumption by monitoring equipment idle times and managing fuel efficiency.
Remote asset management technology uses GPS hardware attached to each piece of field equipment to send data via a server or cell tower to a desktop computer in your main office. Your office staff gets real-time data on the equipment’s precise location, run times, idle times, and speed. Armed with this information, you can see how much fuel is being used and take steps to establish procedures that reduce idling times. Reducing idle times for equipment not only saves fuel, it often translates into increased job site productivity.
Using remote asset management technology can also save money on maintenance. For example, the system can automate the process of monitoring equipment maintenance schedules and help in scheduling timely maintenance on heavy equipment. Better scheduling reduces wear and tear and helps prevent equipment breakdowns.
Charge for Every Change Order
Tracking and charging for every change order lowers your cost of doing business. For every change your customer asks for, break down the costs and present the estimate before you begin any work. For each change order, use a standardized cost template. Be sure to capture all extra costs, including:
- Additional time to process paperwork, supervise the work, and complete additional accounting
- Costs associated with the use of equipment, tools, utilities, and temporary protection, such as fencing and barricades
- Gas and oil
Record every change order in a log created for this purpose. Change orders should be identified by serial number, subject, and date received. Obtain the signatures of all parties involved before work begins.
Improve Material Handling
You can improve productivity by reducing the unnecessary handling of materials on the job. Implementing a measurement program that allows you to determine how many times material is double handled on a job is a critical first step in this process. Once you have the data, specific situations and conditions that create a high likelihood that material, supplies, and equipment will be double handled should be easier to identify.
Consider preparing a map of your job sites and designating specific locations for storing materials where they will be safe from theft or damage. It makes sense to locate these sites as close as possible to where the bulk of the project’s work is being done and only move materials and equipment from the storage locations to places on the site where they will be used immediately.
Our firm would be happy to work with you and help you look for ways to reduce expenses and improve revenues.