When running a construction company, your chances of success depend largely on your ability to manage costs well to find the avenues for profit, to make sure that said costs don’t eat into your opportunities to make some money. Aside from the people that work for you, the equipment you use can be some of the biggest sources of costs to consider. As such, we’re going to look at ways you can manage those costs without having to compromise on the quality or variety of equipment at your disposal.
Knowing when to hire
One mistake that a lot of fledgling construction businesses can make, leading to spiking costs, is to try and buy every piece of equipment they’re going to use outright. This equipment is expensive, not only to buy but to own and run, so you should ensure that you’re hiring equipment that you’re not going to be relying on repeatedly over a long period of time. Hiring equipment that you’re only going to use for one job in the next two years is a lot more sensible than buying a machine only to leave it lying unused while you still have to pay to maintain it.
Investing in the right equipment
While buying a piece of equipment that you only use once or twice is a mistake that can cost you more than it needs to, the same can be said of the inverse. If there’s a piece of equipment that you rely on a lot, like Cat forklifts for moving materials in a worksite, then you should consider buying one as soon as you have the opportunity, rather than hiring it. Hiring becomes less cost-effective the more often that you have to do it. If you see yourself needing a piece of equipment a lot in the future, it’s better to buy it.
Consider sharing your equipment
Working out when it’s more cost-effective to buy or hire isn’t always perfect, and you are going to have equipment that is going to go unused for periods of time, even if it is a worthwhile investment in the long run. However, you don’t just have to leave it sitting useless. You can share equipment with other companies, establishing a rental service that allows others to benefit from access to your vehicle, while they can help you get a continuous return on your investment, while also making it a lot easier to manage the maintenance costs.
Maintaining your equipment
You should assume that those aforementioned maintenance costs are simply a given when it comes to owning any kind of construction equipment. Formulate a preventative maintenance strategy that ensures that your equipment is ready to use at any given moment. While this may be a cost to consider, it’s likely to be a lot less expensive than the repairs you will have to pay for should the equipment fail. What’s more, you’re preserving the lifespan of your equipment while also minimizing the chance of downtime. Even a little quick math is going to make it apparent that eating those maintenance costs is the smartest way forward.
Preventing theft
Your equipment failing is not the only way that you can experience unexpected equipment downtime. Theft is a very real threat in the construction industry, often due to the public access to worksites, as well as the value of the assets used in construction jobs. Insuring your equipment is vital but, even if you are insured, the costs of downtime and how they can affect your project are big risks. You need to take steps to reduce the risk of theft in your construction business, both internally through things like background checks on your employees, and externally through equipping your site with security equipment like CCTV and alarms.
Only using experienced operators
Unexpected damage to your vehicles doesn’t just happen as a result of poor maintenance of your equipment, either. It can just as easily happen due to accidents and misuse. You should ensure that only people who are trained and licensed to operate your construction vehicles are allowed to get through the wheel. Be sure to consider the safety of any site before introducing equipment, such as by marking off areas it shouldn’t drive into, and keeping operational areas clean and clear.
The particulars of which equipment costs are most prominent in your business, and how you can manage them will be specific to you. However, with the principles above, you can ensure that you’re not blindsided by unexpected costs from the majority of angles.