Cut Costs, Not Corners, With These 10 Saving Strategies for Construction Managers

Budgeting is a challenging skill to master in construction. Many development projects face costly delays, and some budget overruns are beyond anyone’s control. However, better decision-making can prevent these issues.

Consider these 10 strategies to cut costs without cutting corners.

1.     Leverage Stock Designs

Crafting a building design from scratch is a time-consuming process. The preconstruction phase takes weeks and requires gathering input from various stakeholders. It’s fun to draw a fresh building plan for each project, but more risk comes with the territory. Every new design must be scrutinized to identify and fix errors, inflating costs.

Use time-tested plans instead. Stock designs represent existing structures, so they have withstood scrutiny and are less subject to disruptive change orders. Adopting them can speed up the preconstruction phase and minimize expenses.

Tweak some elements and adapt them for new projects. This way, the new structures don’t seem like replicas of the original and can have their own character.

2.     Hire a Competent Crew

Impeccable building plans mean nothing when the construction personnel are inept. Each project can present unique challenges, so forming the right group for the specific job is imperative.

The most successful construction managers have an eye for talent. They know how to hire qualified workers, assign tasks to specific individuals based on their strengths and weaknesses, and tap suitable subcontractors to ensure the project progresses on schedule and within budget.

3.     Salvage Reusable Debris

Demolished structures are a gold mine of valuable materials. As much as 90% of construction waste is salvageable, so recovering recyclable debris should be a prime consideration for any economizing construction manager.

Deconstruction is slower than demolition. Still, taking the mechanical disassembly approach can speed up this process.

Methodically disassembling a building structure promotes sustainability. Green building projects rely on it to procure recycled materials, minimize leftovers and reduce indirect greenhouse gas emissions.

4.     Rethink the Supply Chain

Construction managers who are over-dependent on imports for supplies should consider buying from local vendors instead. Not all building materials are locally available, so working with international supply chain partners may be unavoidable. However, designing a building with abundant domestic resources in mind can eliminate the need for importation.

Localizing the construction supply chain can prevent budget overruns in various ways. Endemic products cost less to transport and may be cheaper than goods subject to tariffs. Local materials usually have shorter lead times since they don’t have to cross the sea to reach the job site. They’re also more immune to international geopolitical events because foreign governments can’t restrict the movement of domestic commodities.

When it’s impossible to forgo imports altogether, wise construction managers diversify their supply chains in any way they can. Prioritizing local suppliers over international ones whenever it makes business sense is vital to avoid going over budget.

5.     Use a Group Purchasing Organization (GPO)

GPO membership is a ticket to lower material prices and more streamlined procurement procedures. A GPO is an entity helping businesses gain more power at the negotiating table when sourcing large volumes of materials. The collective purchasing power of builders yields discounted rates because suppliers have incentives to charge less when they can sell more fast.

Rebates are another perk of being a GPO member. Working with specific vendors can unlock more savings.

GPOs live off membership fees or pocket a percentage of their members’ spending, although some take a cut from suppliers’ sales. Joining a GPO network costs money, but this expense pales in comparison to the savings a construction company can reap.

6.     Prefabricate Building Sections

Manufacturing steel structure components off-site helps avoid various causes of delay — weather-related holdups and job site accidents — that can otherwise affect the project timeline and drive up costs. The prefab process yields accurate design and consistent construction, ensuring building sections are code-compliant and have optimal strength-to-weight ratios.

Prefabrication minimizes waste and ensures swift assembly. It also fosters sustainability because steel is recyclable unlimited times without experiencing degradation.

Prefabricated construction lends itself to customization, too. Gone are the days when modules look like identical boxes. 3D printing has made it possible to bring any architectural ideas to life.

Combining all these benefits can translate to massive savings. Prefab construction may not be universally applicable, but it’s low-hanging fruit when it is.

7.     3D-Print Structures

3D printing is more prevalent in residential construction than in commercial. Building codes adopt 3D-printed structures slowly for safety reasons, prolonging and jacking up the cost of the approval process.

When it’s a viable option, take advantage of this remarkable innovation to spend less on material and labor. It isn’t a nascent technology anymore.

3D printers can handle various materials, including concrete, steel, fiber-reinforced mortar, asphalt and tar. Researchers at the forefront of bio-based construction have printed three-dimensional geometrically complex soil structures supporting vegetation growth. Soon, 3D printers may be able to extrude other widely abundant renewable and eco-friendly artificial materials.

8.     Rent Equipment

Owning construction assets can be expensive, but it’s often necessary. However, not everything is worth buying. If you tend not to use a piece of construction equipment more than 60% to 70% of the time, renting is the better option. Aside from not cutting a big check, using a rental absolves the company of maintenance duties.

The downside to renting is the asset may involve some waiting when unavailable. Still, it’s a slight risk any construction manager can live with when it means money.

9.     Embrace Lean Thinking

To be a lean thinker is to have a waste-reduction mentality. Lean-thinking construction managers know the values the building owner upholds and take a cue from them to determine what matters and what doesn’t. As a result, they ensure the project progresses according to the client’s motivations.

Lean thinkers pay attention to barriers to efficient workflows. Examples are defective products, inventory surpluses, overproduction, needless movement of equipment and people, idle time, unproductive personnel and redundant processes. Construction leaders with a lean mindset strive for continuous improvement and fine-tune sound practices along the way.

10.  Use Collaboration Tools

Miscommunication can be costly. The administration and on-site crew must always be on the same page to address issues urgently when they arise. Limited lines of communication are the culprit, which is unacceptable in the digital age.

21st-century construction managers must use reliable project management software to promote team collaboration. It enables geographically fragmented users to monitor project progress and track construction activities. Such a tool ensures critical data is in sync across all devices so everyone only sees one version of the truth.

Tighten the Belt Without Skimping

Managing a construction budget is a testing endeavor. There’s no avoiding it, but there are proven ways to make it easier. Although applying these strategies is no walk in the park, following them will eliminate unnecessary expenses and prevent common cost overruns.