Do you know how much construction material mistakes are costing each project? Material management is a crucial and complex part of every construction project, so why aren’t contractors leveraging technology to improve it? While many builders associate material management primarily with the purchasing and delivery stage, material management actually stretches across a much more comprehensive range of project activities, from planning and procurement to managing material waste.
A well-executed construction material management strategy can generate significant cost savings and improve project efficiency. Conversely, a poorly executed one can lead to significant delays, safety concerns, and decreased profitability on many levels.
This article teaches how construction material management software can play a critical part in the success of employees and the profitability of construction projects of all sizes.
What is construction material management?
Construction material management is the practice of sourcing appropriate materials at a reasonable cost and working with suppliers to ensure their availability — meeting project requirements and deadlines at the right time and place. It is a vital function for contractors and their construction projects of every scope.
The precision of your construction material management practices can make or break a project budget. A disjointed materials management strategy risks skyrocketing costs through material waste, decreased labor productivity, and potentially missing project milestones and deadlines. However, a focused strategy leveraging the right tracking tools has some significant benefits.
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What involves construction material management?
- Integrate a wide range of activities thru the project lifecycle, including:
- Materials bidding, purchasing, and planning
- Scheduling and transportation
- Quality control and Receiving
- Inventory and storage management
- Transport On-site
- Waste management/disposal
- Tracking and reporting (activities, suppliers, costs)
Why invest in construction material management software?
Given its impact on several workflows and profitability, investing in automation software to improve construction material management can positively affect your overall construction management efforts. Some of the many benefits include:
1. Increasing Jobsite & Office Staff Productivity
A typical target for cost reduction is construction labor expenses by reducing labor wages and hours as much as possible. However, worker productivity is often an overlooked strategy to mitigate costs. Effective material management plays a crucial role in maximizing labor and office staff productivity.
A construction crew needs to have the right supplies at the right time to accomplish their objectives. If there is a need to order materials, they need an easy mobile app to request the materials and know if they are available. The more time spent waiting for equipment and material deliveries or tracking them down on the construction site, the less they can accomplish, and the likelihood of project delays or paying overtime costs increases.
The purchasing and accounting team spends countless time tracking down invoices, purchase orders, and bills of materials to ensure the accuracy of materials ordered and payments, then manually entering data into the accounting system. As a result, hours every week can be saved and dedicated to more critical tasks.
2. Minimize or Eliminate Duplicate Handling of Materials
Accounting for up to 40% of of the team’s time on a job site, material handling is another source of costs and reduced labor productivity. Purpose-built material management software provides instant communication, tracking and scheduling capabilities. With these, jobsites are prepared for materials, and they can be deposited and stored in the ideal location. This level of management ensures workers aren’t wasting time moving materials and equipment when they’re needed.
Ideally, material deliveries should be scheduled so that the appropriate staff can receive and easily inspect them without having to travel from the jobsite to the office and vice-a-versa. In addition, project materials should be unloaded into an available storage area or as close as possible to where they’ll be used. This avoids unnecessary duplicate handling, saving time, and minimizing the risk of damage during relocation. Ultimately, the less time spent moving materials, the better.
3. Reduce Weather Damage or Theft
The faster materials can be delivered and installed at the construction jobsite, the better. This is particularly true when there are minimal (or non-existent) secure, weather-proof storage facilities.
Accurate scheduling and acquiring the correct quantity of construction materials reduce the unused time they sit at a job site. This minimizes exposure to the elements and potential weather damage and avoids becoming a target for theft. In addition, a solution like StructShare offers an Amazon-like experience where materials are tracked from the warehouse to the jobsite, alerting users (purchasing, the field, and distributor) of the status along the entire workflow –> including quality control check upon delivery.
4. Mitigate Material Waste
Effective digital purchasing and material management systems ensure that materials are in the right place at the right time and that the right type and quantity are acquired in the first place.
Purchasing the wrong construction materials caused by manual activities (emails, handwritten notes, pictures, phone calls, etc.) can lead to many problems, from minor delays to safety hazards. Faulty materials can even lead to contract penalties if they don’t meet project requirements/code or cause missed deadlines. However, all these issues can be avoided by using a system like StructShare for materials management.
Similarly, a lack of required materials will result in additional costs and construction delays while searching for or waiting for more to arrive. In addition, ordering additional supplies in smaller quantities typically comes at a higher cost per unit than bulk materials, increasing the total cost. This scenario can also lead workers to substitute materials that could be inadequate, again leading to safety concerns or contract penalties for not meeting project requirements.
On the other hand, excess product leads to material waste. This is costly for construction projects due to spending money on unneeded materials and the associated storage and disposal costs. Material waste can also arise from deterioration in storage due to improper storage conditions or being delivered too early and expiring before being used. Material waste can easily be reduced with improved project planning, purchasing, and inventory management stages.
5. Improve Project Budget Accuracy and Forecasting
Material and labor make up a significant portion of construction project costs, even when things are running smoothly. But when problems occur, these costs can explode due to decreased productivity and project delays.
A comprehensive material management strategy helps prevent these problems, leading to more accurate budgets and forecasting. In addition, having a more precise understanding of the existing inventory and future needs will lead to more precise budget forecasts when changes or updates are required.
6. Hitting Project Milestones & Meeting Deadlines
You’ve already seen the many ways that a poorly implemented material management system can impact your construction activities. But, at the end of the day, when workers have what they need, where and when they need it, they’ll be able to get their work done on schedule. This will keep the entire project on track, hitting milestones and deadlines, and — most importantly — avoiding financial penalties for not meeting these objects.
The Benefits of Investing in a Material Management Software
An effective material management system involves many moving parts and numerous stakeholders. The reliance on pen and paper or email methods of the firm in the construction industry can often lead to errors and miscommunications, contributing to many of the problems and delays discussed above. Many construction companies are making the seamless transition to affordable digital solutions as a way to address these problems.
Transitioning your project team to a paperless material management system can bring many benefits such as:
- Increased order accuracy
- Faster bids, orders, payments, and increased trust between stakeholders
- Improved scheduling of material delivery to minimize mistakes, and delays and coordination of jobsite labor
- Digital tracking of ALL materials
- Better organization and access of all documentation such as order forms, invoices, band bill of materials
- Improved accuracy in budget forecasting, vendor performance and pricing and scheduling from real-time data
Want to take advantage of all these benefits and more? StructShare is software purpose-built for subcontractors and self-performing general contractors across the United States. We help you make your businesses more profitable. Request a Demo >