#1 Profit Killer

November 5, 2010

Q: What do other contractors see as the number one profit killer on a job?

A: I hear mostly about what we call “scope creep.” This is the combination of many small tasks that are not necessarily intended to be completed by your company, yet somehow they turn into your responsibility and result in lost time and profits. Sometimes, poorly engineered jobs create this; but, most often, it stems from inexperienced or under-trained project managers. I’ve also found that scope creep occurs when the owner is constantly making requests that are not in the original proposal and the field technicians are too nice to say no. It’s tough because many good technicians are poor communicators. It requires a certain skill and tactful approach to ask a customer to pay more for moves, adds and changes. This is why good project management can make you more profitable. — CW

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