A lot of different reasons can be attributed to the loss of money in construction projects but in this passage, we will go over a few reasons why you might be losing money in your own construction projects. To help you keep all of your overruns at a minimum, we are going to highlight some of the most common cost overruns that can present themselves in construction projects. Here are some useful strategies and things you can implement today to keep your construction projects within budget.
Inaccurate Project Estimates
I know there is always a rush to get started on a project so you can get it finished, if you have inaccurate schedules as well as budgets from the start then it is almost a guarantee that you will run into overruns. Therefore, it is vital to your project’s future that you look heavily into the preconstruction phase and do as much work as you can to ensure you are accurate and realistic about all of your goals. Estimating the project can accurately be done even during the RFP stage. This is when architects, contractors, and owners can all express their concerns as well as their wanted deadlines for a project. In the event where a party is being unrealistic, this should be an immediate red flag that the project could be heading straight into an overrun.
Project Design Errors
Say you have accurate estimates, the next step up the ladder to pay attention to is if your construction plans are faulty you are destined for cost overruns in the construction projects. Design flaws are actually more common than most people would think, Engineers Daily estimates that design errors accounted for 38% of construction disputes. But on the other end of the spectrum having incomplete or incorrect plans almost always result in going over budget as well and not only that but it can also result in legal battles down the line.
Not Planning For Change
Changes can also throw a wrench in your plan so to speak, if you don’t plan for sudden changes in your orders you could be heading into other overruns when it comes to your construction projects. Additional requirements generally result in high costs, which obviously will go against your original project budget.
Even if you have solid designs and no changes done to your orders your project could still experience overruns if project administrators aren’t being noticed with your projects porgress. When even the smallest of errors occur with the administration team, the results can be enormous. If the communication lines between the administration team is limited, problems can occur that some administrators don’t even know about.
Having the proper design, equipment, and marching orders are just a few things that need to be tracked during any contrsuction projects. Unfortunately, this does not always go as intended leading to severe cost overruns on the projects. Improving the on-site communication is a major step in reducing some of the issues that can arrise in poor site management.
These are just a few ways that you could potentially run into overruns wih your contruction projects, there are obviously a million ways that any project can go array. But hopefully this brief list was able to shed some light on some issues that are evident in many different projects.