Account-keeping and auditing within the construction industry is behind real-time events by several weeks, even months, and company managements are aware they cannot use this data to control incurring costs. The Carpio ERP IT System enables users to keep track of the speed at which tasks are being executed, alerting them in the event that the work progress does not guarantee their completion by the designated deadline..
During a financial crisis businesses primarily turn to cost reduction, carefully analysing all business segments which may contribute to the effort. We are often powerless before the external influences of the market, from difficulties with collecting payments to competitors in the field who force us to lower prices. An area in which we can always play an active role is that of our own expenses. As a result, in times of crisis, companies tend to put a far stronger focus on tools for cost analysis, and the need for viewing the scope of operations from several angles becomes clear. The choice of the right tools for this can mean the difference between survival and ruin.
Given that the construction business involves high-value projects, the costs are also high, and small cuts into the budget can mean significant breakthroughs in the operation. Most frequently, construction companies pay attention to material costs, and try to carefully monitor the use of materials in various projects. At the same time, however, they often forget that the cost of materials represents only 30-40% of the overall expenses of a project, while the remainder of the budget is spent on their employees’ and machinery’s working hours.
Since the company cannot influence the base prices of the materials they are using, it is clear that careful monitoring of these costs will not result in significant savings (except in extreme cases of extravagant spending). Employees’ working hours, on the other hand, are most often counted by the number of hours they are present at the site, while a tender is based on effective, accountable hours only. It is clear to everyone, of course, that the difference between these two values is significant, and presents an opportunity to cut expenses by a big margin.