With the competition heating up in the building industry, it calls for sector players to step up their game and avoid mistakes that could have them at a disadvantage. While most firms seem to work all the other details to a high degree of accuracy, inability to provide accurate cost estimates proves to be a great undoing.
As such, the ability to furnish your clients with quick and precise construction estimates makes or breaks a building company. Ineffective construction cost estimating hurts not only your bottom line, but also your reputation.
Loss of Credibility
Underquoting is often a sticky point in many construction jobs since it proves quite difficult to get some clients to invest more money into the project. In some instances, shady contractors underbid with the sole purpose of winning a contract only to turn around and hike the costs. As such, the practice is highly frowned upon as it becomes quite difficult to tell apart the genuine cases from fraud.
Waste of Time and Resources
In the event of an oversight, you have to get back to the drawing board to root out the problem and lose a considerable amount of time consulting different experts in the process. Again, if the project is already underway, you might have to take down some sections to apply the changes. This leads to massive losses, as well. Having to redo a section of the work may cast a huge shadow on your professional image and could even ruin your business.
Loss of Competitiveness
The inability to incorporate crucial factors such as materials, human capital, and expertise with a certain amount of accuracy lowers your firm’s competitiveness. It creates a significant discrepancy between your quotes and other players on the market causing clients to ignore your bids. Use of specialty cost estimating software allows you the ability to provide realistic and competitive bids much to the customer's delight.
Many construction firms often struggle to get long term and returning customers on the ground of inadequate cost estimation process. By failing to refine your cost estimation process, you pose a considerable threat to the firm’s credibility and professional image.