From remodeling homes to building skyscrapers, Nashville General Contractors manage every facet of the construction process. Their days are a jigsaw of diverse tasks, including complex project planning and intricate financial oversight.
Effective project planning translates into realistic timelines and resource allocations. Their foresight enables them to anticipate challenges and plan contingencies, turning potential roadblocks into stepping stones.
Project management is essential to ensuring the proper allocation of resources, optimizing productivity, and minimizing waste on construction projects. It involves working with stakeholders to accurately forecast resource requirements and coordinating procurement, labor management, and subcontractor management. Project managers also use digital tools to track work progress, ensure accurate documentation, and minimize errors.
Commercial general contractors play a vital role in the planning and preconstruction phases, working closely with architects, engineers, and clients to develop comprehensive project plans and specifications. They use their expertise in value engineering to optimize designs to meet project goals while minimizing costs. They also help prepare budget estimates and a construction schedule, assessing the feasibility of various design alternatives.
They oversee the physical construction process, hiring subcontractors to perform specialized tasks like plumbing, electrical work, HVAC installation, carpentry, and concrete work. They act as the primary coordinator on the jobsite and ensure all contractors work to specifications, meet regulatory requirements, and adhere to building codes and standards.
Project Managers also evaluate bids for compliance with project specifications during the bidding process. They disqualify any bids that don’t meet minimum criteria or address all aspects of the project scope.
They also determine the project delivery model and contract type. For example, they may select a fixed-price contract where the contractor agrees to complete the project for a set price. This approach offers more cost certainty for the owner, but it can be challenging to accommodate changes or unforeseen issues that arise. Alternatively, they may choose a unit-price contract, which breaks the project into units and pays contractors for each one completed. This provides flexibility and incentivizes efficiency, but it also shifts risk to the contractor and may result in overruns.
Contract Negotiation
It’s not practical for general contractors to keep enough staff and equipment on hand to perform all of the work required to complete a construction project. Therefore, GCs typically use subcontractors to provide specialized services, such as heating and air conditioning, painting, or sprinkler systems installation. Whether the work is performed by the GC or by a subcontractor, all of the contract terms must be reviewed and negotiated. The negotiation process is not only a means of protecting a company’s profit margin, but it also can help prevent unnecessary disputes during the course of a construction project.
In the case of form construction contracts, a negotiated agreement allows for some flexibility when it comes to the scope of work and pricing of each task. It’s important for the contractor to define and clearly describe each task so that the resulting document is consistent with expectations. Ideally, the scope of work will be broken down by who, what, where and when to establish clarity and minimize disagreements. Construction jargon should be avoided, and a glossary should be included to ensure that the document is easy to read for all parties.
Contract negotiations also include a discussion of payment provisions. For example, most form construction contracts contain a pay-if-paid clause that ties the GC’s obligation to pay a subcontractor for work performed and accepted to the GC actually receiving payment for the job from the owner. It’s possible to negotiate a change to this language that allows for payment after proof of performance and delivery of lien waivers. It’s essential that a GC negotiate this because it shifts the risk of non-payment from the GC to the subcontractor.
Material Procurement
Procurement management involves planning, sourcing, and purchasing materials for construction projects. This process is vital to the success of a construction project because it ensures that the necessary materials are available at the right time, and at the best price. It also helps to prevent delays and make sure that the construction work is completed on time. Material procurement management can be a difficult task because there are many moving parts involved. This is why it is important to have a team of experienced professionals on your side.
The procurement process begins with identifying the necessary products and services, evaluating their costs, and determining when they are needed. Then, you can find suppliers through various channels, such as industry associations or online directories. Seeking referrals from other general contractors or construction professionals is another great way to identify reliable vendors. This method helps to reduce the risk of purchasing substandard goods or services and saves time by not having to conduct a lengthy search.
Another step in the procurement process is to create a contract that clearly outlines the terms of the agreement. This includes payment terms, project milestones, penalties for delays, and dispute resolution procedures. A well-drafted contract will help to minimize disputes and ensure that all parties are on the same page. Finally, it is important to track procurement activities and communicate with suppliers regularly to ensure that the project remains on schedule.
Border Sourcing specializes in construction material procurement and management. Our expertise allows us to source the right materials for your project, at the best prices, and ensures that they are delivered on time. To learn more about our services, contact us today.
Quality Control
Quality control in construction is crucial for ensuring that the finished product meets specific standards and specifications. General contractors use their experience and knowledge of building plans, blueprints, and specifications to ensure that the construction work is completed correctly. They also oversee the work on site to ensure that all employees are working safely and that they are following the correct protocols.
Contractors must also establish quality expectations with suppliers and vendors at the start of each project. This includes specifying quality standards for materials, delivery schedules, and any other relevant details. Regular inspections and testing are also important for identifying any issues or defects in the construction process. This enables prompt corrective action to maintain quality standards and ensure compliance with contract requirements.
Having the right team in place is essential to implementing an effective contractor quality control plan. The plan should identify who is responsible for carrying out inspections, tests, and corrective actions. In addition, the contractor should keep detailed records of all inspections and testing. This helps to demonstrate transparency and accountability, which is critical for maintaining good standing with clients.
In addition, a contractor must follow proper handling and storage procedures for all materials used in construction. This prevents damage, contamination, and deterioration of the materials. It is also important for a contractor to have a system in place for tracking and recording all activities on the construction site.
A general contractor must also have the necessary certifications to manage a government or military construction project. They must pass a two-day course and a closed book exam to receive the Certificate of Qualification as a Manager of Quality/Organizational Excellence (CQM-C). This is an important step in obtaining a federal construction project management job.
Financial Management
Financial management is the backbone of any construction business, and this is especially true in general contractors who manage multiple clients, projects, subcontractors, and vendors. Maintaining strong billing procedures, optimizing materials management, closely monitoring labor costs, and embracing technology to streamline payments can all help strengthen financial management in general contractors.
To maximize project profits, general contractors must have a clear understanding of how all aspects of their project are financed. This includes the initial budget, a comprehensive list of all expected costs, and an accurate estimate of the total cost to complete the job. In addition, it’s important to establish strict control measures for managing project funds and ensuring that all parties involved are kept informed of all financial activities.
In the past, manual tracking of payments was a common practice in the construction industry. This often resulted in lost paperwork, manual calculations, and other errors. Updating payment systems to a digitized format can streamline processes, reduce human error, and create efficiencies for everyone involved.
During the COVID pandemic, many general contractors experienced delays in their project timelines due to restricted access to sites and increased demand for work. This impact was felt throughout the construction industry, including finance and accounting departments. To help their teams navigate these challenges, general contractors need to make sure their accounting practices are up-to-date and can scale as necessary.
To minimize errors and keep up with the demands of clients, general contractors should adopt automated processes for tracking expenses and invoicing. Construction cash flow software and other solutions offer precision budget management down to the item level, allowing contractors to track profit margins and ensure reliable financial records. These systems can also automate invoice generation and tracking, enabling them to send reminders for overdue payments and provide real-time updates on payment status.