Builders costs increase through materials rise
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Builder are being warned that when pricing for work that materials are going up in cost daily and this could effect the profitability of contracts.
The warning comes from HBXL, the building software specialist company, which is expecting a marked increase in the cost of building materials in 2014 as demand starts to outstrip supply across the build sector.
With many builders having quoted for jobs months in advance of starting on site and materials increasing in price during that time has meant some face losing out.
The double whammy of time delays and cost rises is extenuated further by the fact that many builders use out of date price lists to quote for jobs. These may be months old so by the time they’ve quoted for a job, been appointed and then started ordering materials on site could see their profits being eroded alarmingly faster than anticipated.
Joanna Mulgrew, marketing director at HBXL said: “It’s fantastic news that the build sector is starting to show vast improvements in the level of activity.
“Those who have weathered the recession will no doubt have learnt that maintaining a decent profit margin was the difference between survival or potentially going bust.
“With builders now starting to increase their activity means demand on materials has also risen which will impact on profits so keeping an eye on costs will be imperative for a successful future.
“It’s vital builders develop a work smart mentality otherwise, having ridden the worst economic recession in living memory, all that hard work would have been for nothing.”
One solution is HBXL’s EstimatorXpress software, which uses live builders’ merchant’s price lists via the internet. It means all estimates produced use the most up-to-date prices.
Joanna added: “Research has proved that those who use our software can produce their estimates much, much quicker, cutting the time spent estimating by 60%. Users of EstimatorXpress have also been proven to win 230% more business.
“As well as having a higher win ratio, the time from the presentation of quotes to winning the work is also reduced meaning that the prices quoted are more accurate by the time materials are ordered on site.
Many believe the boom in construction will continue and the prices of materials will increase with the boom.