Managing the construction demand, plan for the future

• Business News
• Managing a Business

 As demand for construction and housing remains at a record rate across WA, those in the industry are continuing to face the rising supply costs and labour shortages.

According to CoreLogic’s Cordell Construction Cost Index, WA is currently experiencing one of the fastest growth periods on record for residential construction costs.

CoreLogic construction cost estimation manager John Bennett said the figures showed the cost of metal, structural steel, reinforcing, fixings and fencing were under pressure, adding to rising prices across timber products.

“Suppliers are frequently mentioning the impact of rising fuel, freight and electricity costs on their bottom line and these are significant additional challenges being faced by the industry,” he said.

“It is important to note these factors only add to other pressures that have impacted the residential construction industry for 18 months now, such as labour availability and overheads.

“A shortage of labour and materials means a delay in completion times, which leaves builders vulnerable to market changes and holding costs.” (source: smh.com.au)

Be in the business for the long term

Accounting and business management for commercial, residential and industrial sectors of the construction industry can be complex and multi layered depending on the size of each project.

With the current challenges anticipated to continue for the near future, it is important for those in construction to be on top of their finances, using in touch accounting services, and managing cash flow and compliance within the business.

With your accountant, be sure to review (and update where needed):

• Cashflow projections
• Job projections and payment schedules
• Outgoings
• Business plan and strategy

Budget for the rise of material costs and allow for labour shortages – projecting accurate timelines for job completion (and extending where necessary). Track job costs weekly and schedule regular meetings with the field, project and management teams.

No surprises are a good surprise – be aware of the financials and stay one step ahead of all current and upcoming projects, no matter their size.

How we can help

Elevate Accounting understand that to sustain a successful business in construction requires expert compliance, planning and in touch accounting services.

We help those in the residential, commercial and industrial construction improve tax compliance, plan and implement successful audits, and best financial practices.

Our experienced team cater for the full business lifecycle, providing real time reporting and prompt turnaround times for each project.

Services include:

• Monthly and Quarterly Management Accounts
• Contractor payment and management
• Preparation for Audit
• Bookkeeping including payroll and month-end reconciliations
• Taxation including lodgements, planning and reduction
• Financial planning and strategy

Learn more about managing your construction business with Elevate Accounting HERE