Stakeholder - Progressclaim.com


Seven reasons why 69% of construction projects exceed their budgets

Fewer than one in three construction projects come within 10% of budget. Consider these seven reasons why yours might be overspending.

In the three years to 2015, fewer than one-in-three projects (31%) came within 10% of their original plan.

There are seven good reasons why the majority of construction projects exceed their budgets. Like a child’s wooden stacking tower, if you lose enough bricks as a result of these factors then the whole project comes tumbling down.

construction-projects-exceed-budget-umbrella1. Wrong forecasts

Every construction project must have a solid foundation, with a well-written job specification and budget. With so many moving parts across the lifetime of a project, failure to nail down a properly costed plan means there’s the risk of mistakes, disputes and confusion.

2. Labour costs

Labour costs are a major headache, with 65% of UK contractors reporting that they are up on a year ago.

Finding a quality workforce is a huge challenge.

Three-quarters of firms say supervisors and bricklayers are difficult to recruit, with carpenters/ joiners and ceiling fixers not far behind. A tight labour market forces up construction costs.

       5-ways-increase-margins-row-builders

And what happens after Brexit if EU labour is no longer available? An estimated 12% of the UK construction workforce in 2015 came from abroad. Faced with this challenge, UK construction businesses need sound supply chain management practice in place to keep their skilled subcontractors happy.

3. Poor communication

Inconsistencies in reporting often mean that neither subcontractors, contractors nor owners know how their project is faring at any given time. This makes it hard to react when there’s a problem, leading to delays and cost overruns.

4. Subcontractor issues

They are the cement that holds the project together, but when they fail to deliver the consequences can be far-reaching. More often, relationships break down because of poor management by the contractor.

5. British weather

Too much rain or a cold snap can halt construction for days and leave projects significantly behind schedule. Tools are downed but workers still have to be paid.

6. Disputes7-reasons-construction-projects-exceed-budgets-laptop

These are more common than you think. Almost one half of respondents to a survey of national
contracts
reported at least one dispute in a year. Most stem from poor contract administration.

7. Inefficient payment processes

The application for payment function is a critical element of the construction process. Applying, approving and certifying effectively is the key to getting paid!

Contact Us

UK & Europe

The Clubhouse, St James's Square,

London, SW1Y 4JU


Office 101, Business Exchange,

Cobalt Business Park,

Newcastle Upon Tyne, NE28 9NZ

E: [email protected]

T: 0191 280 5076


Australia

Suite 5, Level 6, 350 Collins St,

Melbourne, Victoria

E: [email protected]

T: 1300 252 463


Asia

171 Tras Street,

#10-179 Union Building, Singapore 079025

E: [email protected]


www.progressclaim.com

linkedin twitter facebook youtube-40x40

Featured Video

  • UK Construction Online’s Stakeholder page offers you the chance to find and learn about the leading companies in the UK Construction Industry.

    Featuring the very best suppliers and operators in the sector our stakeholder’s pages offer detailed information about the company, their latest case studies and press releases, plus products and services and testimonials.

    We work with our stakeholders to constantly update and maintain this database to ensure that the information is relevant and helpful for those looking to source premium quality companies in the UK construction market.

    You can ‘View all Stakeholders’ or use the drop down menus to find specific stakeholders via their company name or by sector.

    Join the Fastest Growing Community for Construction

    UK Construction Online's Stakeholder package quickly connects your company to our vast audience of over 250,000 visitors a month.

    View our latest Alexa ranking:

    What is a Stakeholder?

    A stakeholder is a Mircosite that has the power to highlight a product or service, launch a promotion, or promote brand awareness to the construction industry in a way that full websites or more traditional marketing cannot.

    All stakeholders have the ability to have their latest press releases and case studies promoted across the UK Construction Online platform. UK Construction Online is updated daily, with the latest news across all sectors within the construction industry and all stakeholders are promoted on both social media and to a mailing list of over 122,000 subscribers.

    UK Construction Media
    0800 6127680
    [email protected]