Chief Marketing Officer
Rising material prices can have hard-hitting cost implications for construction projects, but given that rework makes up 5 percent of a project’s cost, these price fluctuations can have considerably less impact when rework is reduced. In 2018, rework—caused specifically by poor project data and miscommunication—cost the United States construction industry $31.3 billion.
One of the easiest ways to reduce rework is to employ a technology strategy that increases collaboration between stakeholders and provides access to critical data when it’s most needed. The right strategy should better connect the field and the office, take into account the unique needs of both sets of users, and allow work to get done faster—all reducing employees’ time and labor costs.
Through construction productivity software, construction teams have easy-to-use tools to collaborate—a central source of truth and real-time insights on the status of project work and potential changes to scope or budget. And these teams have a greater competitive advantage.
Materials prices will fluctuate, as they always have. Variable costs for essential project components can certainly be trying, but they represent another set of challenges that construction technology can help address.
Vice President & Corporate Preconstruction Director Brasfield & Gorrie LLC
Brasfield & Gorrie employs several strategies to deal with material price fluctuations, whether they are caused by the recent tariffs or any myriad other factors.First, we compile a quarterly cost report to track long- and short-term material cost trends, both from national sources and local subcontractors and vendors. Using this information, we can help our clients better understand market pressures and avoid surprises.
Next, we help the project teams explore design alternatives that minimize use of the materials experiencing significant price escalation. Often, there are options available that can mitigate some exposure from material cost fluctuations.
Lastly, we work with clients and design teams to develop procurement strategies that allow key materials to be purchased as early as possible. The use of early-release packages, or similar strategies, can help lock in material pricing for certain trades, safeguarding against and eliminating further exposure to price hikes.