Top ten things builders must do in 2022
Builders now more than ever need to ensure they go back to basics to ensure their survival in these tough times. This is not the time to take shortcuts or neglect key issues in your business.
My list of the top ten things builders must do in 2022 is as follows:
- Builders must now more than ever know their numbers and financial position, both for each job and overall. Builders in financial difficulty should be meeting with their accountant regularly to see if they are still solvent and find out how to stay solvent.
- Builders need to have their head contracts reviewed by a specialist lawyer prior to entering into any head contract to ensure their risk is factored into the construction cost.
- Builders need to push to have rise and fall clauses in contracts to cover fluctuations in the cost of materials and labour.
- Builders need to stop trying to win work just to keep to growth targets.
- Builders need to aim for a minimum 8-10% margin on projects. Anything less is too risky in the current market.
- Builders need to ensure their subcontractors are properly managed and ensure their work is supervised to avoid defects and delays to the project.
- Ensure that your employees are properly trained in contract management for both claims up and down the chain.
- Be on top of the new changes in legislation, particularly in the residential space.
- Ensure your insurance is appropriate for your current circumstances.
- Ensure all payment claims by subcontractors are responded to in writing with a payment schedule within 10 business days (or within the earlier timeframe under the contract) setting out the scheduled amount and detailed reasons for withholding payment (if any).