You own the business.
Now you can also own the process. Every flooring contractor owner we interview is asked how many jobs they bid, how many they win, and how long does it take to process and submit a closeout package. Unfortunately, the answers are usually vague or completely unknown. When a project is bid or negotiated, the estimator, sales associate, and owner bake in a margin they expect to “enjoy” if they are awarded the project.
Project management can be a difficult expense to manage. Pacific Solutions has great ERP software products that help you see where margins are leaking from your awarded projects. You can use this information to help bolster your margins on your next project. However, nothing will change your outcome if you don’t make subtle changes to your process. And you won’t know what to improve upon if you are casually aware of your current process.
Consistently, when owners are asked how long does it take to complete a closeout package they have to ask one or two of their associates for the answer. While not a surprise to us because we have asked over 100 project managers but, 100% of the owners are surprised at the response. On average, the time it takes to complete a closeout package ranges from four (4) to six (6) hours. This new clarity about their process to manage projects through Product Management then launches them into the next obvious conclusion; “What margins should I apply to each project to make a predictable profit?”. Every owner quickly surmises the obvious.
What else should I know about my expenses/margins? So the questions then follow:
How long does it take to complete a submittal package?
How long does it take to order samples?
How long does it take to validate a finish schedule for accuracy?
Do you validate a finish schedule prior to bid?
How many errors are we correcting?
How many errors do we have in our own submittal?
How many times do we duplicate work - like create a product list from a finish schedule, over and over again?
And the questions continue…
There is an old saying that claims everything that is measured is improved. This is especially true in the commercial construction industry. This may be the biggest argument for why flooring contractors have invested in financial software, take-off software, and estimating software like Measure Square, Job Runner, and others.
Why were investments made in these resources? These tools no doubt have improved accuracy, and potentially improved margins. We are convinced that at one point the flooring contractor said “No” or “We already do that.” when these software tools hit the market. Of course, that’s what they said. They had a thriving business, they had estimating tables, calculators, pencil sharpeners, and maybe an excel spreadsheet. So why did they finally decide to invest in software? The answer is most likely - COMPETITION. External market competition from competitors is obvious. But they also had to compete with wages, higher fuel costs, competition from material costs, and even expanding their market or maintaining what they had. Competition creates innovation and technology is at the forefront of innovation. So yes, they eventually invested in technology.
So what is the next turn of the wheel? It is once again something we hear every time when asked about Product Management tools, “No” or “We already do that.” Sound familiar? Of course, you already do that. You have a thriving business with very little competition. You have a staff person or persons dedicated to product management. They have phones, a personal computer, label maker software, PDF software, Excel and WORD software, they have years of experience, and printer(s) all at their disposal. And all of this only takes 4-6 hours to complete a submittal package. Another 4-6 hours to complete a closeout package. An additional 2-4 hours to manage sample orders. Add more hours for product labels. For some, even more hours to secure pricing for each product. All of this should take less than one hour for EVERY project.
The Solution. Once again, commercial construction software is on the cutting edge of innovation. A web-based software platform can eliminate re-work, reduce manual errors, provide consistent and predictable outcomes, and reduce competition (internal and external) while increasing your margins. It may be time for you or someone in your company to own the Product Management process for better outcomes, more satisfied employees, and higher profits. One place to start is Spec-ID.
“Spec-ID gives us the ability to prepare professionally presented Submittals, Close-Outs, SDS books that can include installation instructions to send with the installation teams, order samples and we especially love the labels! Sometimes clients change design themes and making those changes is almost painless and at the same time allows for proper and accurate tracking of those changes!”
— Susan Hoblit, President-General Manager, Tuscon Commercial Carpet
