Control Your Labor Costs, Boost Profits

Article content provided by Trimble.

In the construction industry, profit margins are notoriously low, which means staying profitable relies on your ability to deeply understand and control costs. Labor costs can be 20–35% of total project expenses for mechanical contractors and are a vital piece of profitability. If you don't track them right, you can lose money without knowing where your profit went.

Knowing your true labor costs helps you create more accurate estimates for future jobs. Plus, having a real-time view of labor costs compared to your budget lets you catch possible overruns early. This crucial visibility helps prevent profit fade, and keeps your company on the path to success.

Simple Ways to Control Labor Costs

While costs change based on location and the economy, a few simple strategies can help you manage labor expenses everywhere:

• Capture work hours accurately: Use mobile-friendly software for time entry. This ensures you pay correctly and lets you measure worker efficiency by assigning time to specific projects and tasks.
• Assign skill based tasks: Don't pay an expensive, highly skilled HVAC technician to sweep up the site. Match your crew members' skills and experience to the project's demands.
• Analyze work in real time: Getting up-to-date data from the field allows you to generate job cost reports quickly. This helps you compare actual costs to your initial bids, so you can stop cost overruns before they become an expensive surprise.
• Invest in your employees: It's almost always cheaper to keep and train your current team than to hire new skilled workers. Create career pathways to develop the expertise you need and build a stronger, loyal workforce.

The Power of Connected Solutions

The best way to take real control of your labor costs is by using a connected solution. Imagine instantly collecting time entry from the field and seeing that data in real time. Connected labor and job costing tools automatically pull field data to compare your estimates against what's actually happening.

When you connect job costing to your company's planning system (ERP), you get an immediate look at how any change in labor costs will affect your project budget. This lets you make smart decisions to keep your project's financial health strong from start to finish.

Read the full article on Construction Dive. 

View Trimble’s products and services here.

Contact a Trimble Representative here.

Trimble is transforming the way the world works by delivering products and services that connect the physical and digital worlds.