Costs are rising in the construction industry, but here we explore how investing in the right construction accounting software can help you take control.
The UK construction sector has been expanding in recent months, but the issue of rising costs remains as a negative threat to companies who fail to take the right action. The good news, however, is that there are many construction software packages available that can help combat these costs by driving efficiencies elsewhere in your business.
In the latest Purchasing Managers Index survey by Markit and the Chartered Institute of Procurement and Supply, it was revealed that the input cost inflation level has jumped to the highest level since the summer of 2008. Some firms stated that this had led to delays in the taking of decisions as many were unsure if they could make the necessary financial commitments.
Explaining the causes that have brought this situation about, Markit economist Tim Moore said: “Suppliers’ efforts to pass on rising energy costs and global commodity prices have been amplified by the weak sterling exchange rate.”
Put simply, this means that these inflationary factors are likely to persist and therefore simply waiting and hoping they pass soon is not an option. The key is to find cost savings and rather than cutting staff, the best way forward is to improve efficiency elsewhere – and investing in the right technology is a great way to do this.
Using modern technology
This is where the benefits of using construction software packages designed to keep costs under control come into their own. For example, dedicated construction estimating software allows you to use data from past bids to learn which jobs are the most profitable, or not, and why.
Also, using construction accounting software that provides an overview of the entire process of a construction project can offer a much better insight into where inefficiencies lie. This enables you to establish what things can be done differently to save money, and how to spot signs that costs are unnecessarily creeping up or projects are running over budget.
All of this will mean you can make decisions in real time based on accurate visibility of your margins and cashflow. You can also make sure you get paid on time and don’t miss money owed to the business by forgetting to chase outstanding retentions for example.
The rising cost base faced by the construction sector may tempt some to cut back by reducing investment in new technology. However, at Eque2 we see many construction companies every month go the opposite way by investing in new construction-specific solutions, making sure they are as efficient as possible and have visibility of the metrics which matter to their business.
To find out more about how Eque2 construction software can help contractors your business to keep costs under control please contact our team below.