The startup costs to any business can be huge, but in the construction industry, they can be eyewatering. Here is a quick guide on how to reduce some of these costs so you can have a better balance sheet at the end of year one.
Rent Machinery, Don’t Buy
Any construction company will need a selection of machinery, powered tools, and vehicles to get its jobs done. These are some of the most expensive items on any startup construction company’s budget. You can save a huge amount here that you can reinvest in other areas by renting your equipment. For a clearer picture, take a look at low-cost forklift rental Springfield MO for big savings on your day-one expenses. Taking advantage of rental opportunities can save your company thousands of dollars a year, which can be vital to your year-one survival.
Track Every Cost and Asset
Construction sites have a lot of moving parts, and construction companies are no different. On any given workday you are going to have valuable supplies, equipment, and workers moving around different sites. Keeping track of things is important to prevent losses and waste. These two factors will be the big drains on your operational budget. Know where things are and where they are going. In the construction industry, good logistical management is good financial management.
Work with an Accountant
Though they come at a cost to your budget, an accountant will save you money in the long run. Not only do you get to delegate a time-consuming task to them, but they also have the experience and knowledge needed to take advantage of tax incentives and deductions. An experienced construction accountant will streamline your accounting process and ensure you are getting the most you can from tax fillings. The time and money they can save a startup should not be underestimated.
Buy Common Supplies in Bulk
The savings available on bulk buying supplies can be vital to a startup construction company. You can get a steep discount on many of your regular costs, and you can save time too. You do not have workers waiting around for deliveries if you are in control of their supply line. Time is money in construction, and any time you can save is money in the bank. If a delivery from a supplier to a site is delayed, it can cost you hundreds of dollars in lost man-hours. Buy in bulk, store your supplies, and distribute them to sites yourself.
Hire the Right People Even at Added Cost
Labor is your most important resource on a site. Hiring the wrong people, or inexperienced people will lose you money in the long run. It is worth investing in people just as much as it is worth investing in bricks, mortar, and machinery. Take care when hiring and do not let being a startup make you settle for anything less than the best. Your business deserves it.
Follow these five tips and you will be on the road to success. The first year is always the hardest so you need to do everything you can to save money and hit the ground running in year two.