Our last blog was all about slow pay in the construction industry. It really sucks! And, it’s costing the industry as a whole nearly $40B a year. On top of the sheer astronomical cost, though, slow pay is the root cause of a finicky subject in construction: project attrition.
Attrition is the process of gradually reducing the strength or effectiveness of something through pressure. In construction, this means losing your workforce due to things like resignations or retirement, as well as a loss of materials or resources that become outdated or unusable. Project attrition happens as a result of the slow payment cycle that’s all-too-common in construction.
If you’re in the industry, you know the deal. You start with the subcontractors you know and trust, your A Team. But, when funds get tied up due to slow pay, that A Team quickly turns into the B Team, then the C Team… And eventually you’re left with the Two Guy Team, or NO Team at all.
Project Attrition in Construction
When you dip below the A Team, you’re sacrificing a few key components of your construction project, reducing the following:
1. Quality: When the Two Guy Team shows up to your construction site instead of the A Team, your quality is in for a hit. The workmanship of your project plummets, and the requirements made by the owners of the project aren’t met.
2. Safety: Not having a seasoned, trustworthy team can have detrimental effects on the safety of the project site as well. The B and C Teams simply don’t have as much experience doing a hazardous, land-based job.
3. Schedule: Your A Team knows how important keeping on schedule for the life of a project is. But having anything less than the best workers on your project can mean schedule delays, which leads us too…
4. COST: You already know that slow payments are costing the construction industry $40B annually. But, understanding that the cost of your project can be directly affected by slow pay is imperative. Are you about to miss your deadline? Have fun paying overtime to a C Team of subcontractors! Is the quality of this project down the drain? Looks like you’ll have to hire yet another team to fix the mistake made previously.
Avoid Project Attrition Due to Slow Pay
So, how can you avoid project attrition in the future? Utilizing software like DrawAlert keeps your money on your project. We like to toot our own horns and say that DrawAlert helps to save time and money, but when it comes to something as common as slow pay (and consequently, project attrition), we’re here to help your construction project run with the best resources.
Trust DrawAlert to be your project attrition solution. We remove all shadows of a doubt about payments to the general contractor, so subcontractors can avoid the slow pay nightmare. Here at DrawAlert, we believe that transparency is the key to a successful project, and support respectful and professional business relationships between all stakeholders on a project.