How to control commercial construction costs

With the rising cost of materials and labor, it is your general contractor’s duty and responsibility to keep a tight rein on costs. Cost control is one of the most important aspects of meeting client budget expectations. Over the years, we’ve found several areas where we pay particular attention to this end.

Good design pays for itself

Choose your architect and designer carefully. These professionals are crucial at the planning and drawing stage. A well-conceived plan will eliminate costly design changes once the project is underway. Poor planning resulting in changes can add up to 10-15% of the original projected cost, a real budget buster. The best way to hedge against unplanned changes is an investment in a reputable architect upfront.

Design-build firms are better at cost control

The design-build approach where your contractor takes responsibility for the success of your project from start to finish results in better cost control. They are the lead in helping you choose an architect and making sure nothing goes wrong in the planning stage. At every stage of the project, a design-build general contractor exercises oversight to ensure that your project stays on track in terms of both construction milestones and cost.

The 3 R’s: Reduce, Reuse, and Recycle

As consumers, the 3 Rs are well known. But they apply equally in commercial construction. On new-build projects, lean building principles dictate that we get more for less, eliminating any waste. On renovations of existing offices or buildings, it pays to consider what materials and systems still have useful life and can be reused. With the cooperation of our clients, we often ask if things like desks, mechanical systems and construction materials can be donated to organizations for Humanity or other non-profits.

Consider what you need, not what you want

As a general contractor, it is often our job to get our clients to focus on the details that are essential to a successful project, not those that are irrelevant. It might be a ‘wow’ factor to have a custom waterfall in your lobby, but do you really need it? Therefore, it is important in the planning stage to separate needs from wants. Construction budgets are best set and agreed upon before any building begins. It can be difficult to get the best price when upgrades are requested mid-project. It also can play havoc with the construction timeline. If key subcontractors can’t accommodate a change, you’re left scrambling to replace them in a non-competitive bid environment.

Source locally, if possible

Furniture, equipment, even building materials might be cheaper from overseas, but shipping time and cost can eat up the difference. We’ve seen situations where overseas-sourced products have been very late in arriving and then were found to be of sub-standard quality. A delay in shipping can put your completion schedule back, delaying your revenue-generating operation from opening.