Failure of Construction firms

Why is the construction industry such a low profit industry with a high risk how can the situation be improved

 

[HScribner]

The construction industry can be made profitable and low risk if you work with reputable firms. The most difficult problem that faces engineers is that no matter how well designed a system is, it is really only as good as the people implimenting it.

So much time is wasted bickering over the lowest bidder, that very little time is spent actually selecting a company on the merits of its performance and safety rating.

I propose that there are plenty of jobs out there, that when the bid process is thrown out and the job is awarded to the most comprehensive qualifications package, you would find higher rates of return on investment with lower risk during construction and design.

A good example of this mentality is the current trend toward design-build projects. Large projects are being farmed out to companies that can take the guesswork out of the management function. You award the entire project to a reputable firm (I am partial to my own), and allow ample time and cost controls, and return to find exactly what you were looking for completed.

All in all, you can lower your risk by choosing or becoming a contractor rooted in the quality of your work, not the way in which you won the lowest bids by cutting corners....

Value added workmanship is the cornerstone of this philosophy.

 

[Qshake]

I am an advocate of the qualification based system; it is used with specialty contractors (post-tensioning etc.)and should be the standard for the community as a whole.