2021 was quite a year for the construction industry. With high material costs and supply chain issues, we can no longer expect that standard items will be readily available. Coupled with the skilled labor shortage, it was a challenging year.
Fortunately, there are some things we can learn from 2021 that will help us through 2022. Below are five that we can hang our hat on.
Being in the know. Contractors need to keep up with the latest construction news and regularly talk to their suppliers and other contractors to gain perspective and stay ahead of changes. Up-to-date information can help contractors create a plan of action before they find themselves facing material delays and excessive costs. This additional effort can be invaluable as we maneuver through the year.
Relationships. Business relationships between the owner, general contractor, and subcontractors have always been important, but they have become even more so. Everyone involved must be flexible and understanding throughout the project. Communication and transparency are vital to ensure that everyone is on the same page and expected delivery dates don’t interrupt the project schedule.
Creative ideas. To ensure a project’s success, it may be necessary to use some creativity. This can start early in the design stage. Contractors may have to consider alternative materials or equipment due to cost and availability. Preconstruction and weekly meetings are opportunities for everyone to brainstorm how to stay on track and keep the project moving forward.
Contracts. Many contractors are seeking legal advice to incorporate a price-escalation clause in their contracts that will pass a percentage of procurement costs to the owner. This is not the same as a force majeure clause, which excuses parties from contractual obligations as a result of catastrophic or unforeseen events. Owners may be more willing to accept escalation clauses from contractors who are willing to be transparent about them.
Skilled labor. With the lack of shop classes in schools, the societal push for college rather than the trades, and an average age of 43 for construction workers, skilled tradespeople are in short supply. This struggle is not going to end any time soon and brings a realization of the value of your employees. Although connecting with contractor associations and trade schools can offer prospects, contractors should always be on the lookout for young candidates to train alongside their seasoned tradespeople.
For more information or help with your Contractors insurance plan, call Beck Insurance Agency at 419-446-2777, email us at help@beckinsurance.com, or click here to submit your inquiry.
