Australia’s commercial construction industry generates over $360 billion in revenue, contributing around 9 per cent of Australia’s Gross Domestic Product. In the next five years, it has a projected annual growth rate of 2.4 per cent.
However, the COVID-19 pandemic had caused a dramatic turn of events in the global economy. Turner and Townsend construction economist Tiffany Emmett revealed that some commercial construction contractors had received higher invoices for certain items, which were in response to global supply chain constraints. Commercial builders also noted they had seen an increase in cost for imported products due to a weaker Australian dollar.
Amidst the challenges, you can still keep your commercial construction costs on track by following these tips:
Limit your variations
Don’t get caught up in vanity for the sake of change. This is not the time to make decisions on a whim. You need to keep a firm hold of your commercial construction expenses by sticking with your project design and agreed contract as much as possible. If time comes that a variation could not be impeded, make sure that those changes will only cause minimal effect to your budget and overall scheme of operations.
Stick to one builder
Working closely and collaboratively with your commercial builders during these times is crucial to keep everything under control. Liaise with them for any issues and work together to carefully review the project. Identify items that may impact the budget, whether it is due to a regulatory decrease in workforce, labour shortages, material shortages, or schedule considerations.
Communication is the key
With the situation changing almost daily without an end date secured in sight, it is important that all stakeholders and commercial builders communicate more often than normal by leveraging technology. Communication through video conferencing apps is a good alternative to in-person as it allows everyone to read body language and thus alleviate any distrust that might be building.
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