Project Description
Commercial
Commercial
Commercial
Cash flow in any business is the lifeblood of the sustainability and growth of the organisation. The key drivers for ensuring positive cash flow is effective communication and ensuring that all the processes and procedures are in place and are adhered to, monitored and presented in a format easily understood.
Irrespective of whether strategic or operational, the budget should be broken down into bite-size chunks, reflecting the business planning decisions relating to overheads, profit and capital expenditures.
From an operational perspective, a cash flow forecast should be based on the programme of the works and should include preliminary monitoring, milestone payment dates and agreed valuation periods and submission dates. Communication is identified as a key driver, as in the event of predetermined risks becoming actual risks, it is imperative that dialogue is undertaken with the client to both mitigate these risks where possible, and if not possible, agree on how they will be managed. Once again effective record keeping is of paramount importance in the commercial process.
The majority of works undertaken on building and construction sites in the UK is carried out by small and medium enterprises, in many cases on large contracts, working for a large main contractor. It is therefore essential that effective relationships are developed and nurtured with all those within the supply chain, who may include specialist designers, installers, material suppliers or accreditation organisations to whom approvals and sign off is required.
As with cash flow, effective communication is central to maintaining good relationships. The power of a positive cash flow should never be underestimated, particularly when evaluating material supply and subcontractor procurement. It will be prudent to periodically undertake material cost evaluations and particularly in 2021, where many of the raw materials of the industry have financially increased considerably, which substantially affects both the production and commercial aspects of a project.
The evaluation of the relationship between costs and value being produced is potentially the most important process in the construction project. It should be carried out on a regular basis (monthly) to establish the financial position at that time.
The below process should incorporate all members of both the operational and commercial personnel to ensure effective collaboration between all the teams.
Areas for review may include but are not restricted to:
- Staff
- Subcontractors
- Plant
- Vehicles
- Overheads
- Materials
- Direct employees
- Variations
- Contribution
Risk is inherent in every action that we undertake whether in our personal lives or within our business undertakings. The important aspect is identifying these risks well in advance, to ensure there are no negative impacts in the event of them occurring. Within the construction sector, risk can be broadly categorised into four main headings, although they are not restricted to:
- Financial
- Strategic
- Operational
- Hazards
The objective of risk management is to add maximum sustainable values to all activities of the organisation. It increases the probability of success and reduces both the probability of failure and uncertainty of achieving the overall objectives of the business.
Risks should be reviewed both from an external perspective as well as reviewing internally within the business. Reviews may include what external factors will impact on the business, how do different operations and processes interact, what happens if key facilities and people are not available, when would we be unable to operate and what if the unlikely and unexpected actually happened? In a nutshell, risk management is good management.
Cash flow in any business is the lifeblood of the sustainability and growth of the organisation. The key drivers for ensuring positive cash flow is effective communication and ensuring that all the processes and procedures are in place and are adhered to, monitored and presented in a format easily understood.
Irrespective of whether strategic or operational, the budget should be broken down into bite-size chunks, reflecting the business planning decisions relating to overheads, profit and capital expenditures.
From an operational perspective, a cash flow forecast should be based on the programme of the works and should include preliminary monitoring, milestone payment dates and agreed valuation periods and submission dates. Communication is identified as a key driver, as in the event of predetermined risks becoming actual risks, it is imperative that dialogue is undertaken with the client to both mitigate these risks where possible, and if not possible, agree on how they will be managed. Once again effective record keeping is of paramount importance in the commercial process.
The majority of works undertaken on building and construction sites in the UK is carried out by small and medium enterprises, in many cases on large contracts, working for a large main contractor. It is therefore essential that effective relationships are developed and nurtured with all those within the supply chain, who may include specialist designers, installers, material suppliers or accreditation organisations to whom approvals and sign off is required.
As with cash flow, effective communication is central to maintaining good relationships. The power of a positive cash flow should never be underestimated, particularly when evaluating material supply and subcontractor procurement. It will be prudent to periodically undertake material cost evaluations and particularly in 2021, where many of the raw materials of the industry have financially increased considerably, which substantially affects both the production and commercial aspects of a project.
The evaluation of the relationship between costs and value being produced is potentially the most important process in the construction project. It should be carried out on a regular basis (monthly) to establish the financial position at that time.
The below process should incorporate all members of both the operational and commercial personnel to ensure effective collaboration between all the teams.
Areas for review may include but are not restricted to:
- Staff
- Subcontractors
- Plant
- Vehicles
- Overheads
- Materials
- Direct employees
- Variations
- Contribution
Risk is inherent in every action that we undertake whether in our personal lives or within our business undertakings. The important aspect is identifying these risks well in advance, to ensure there are no negative impacts in the event of them occurring. Within the construction sector, risk can be broadly categorised into four main headings, although they are not restricted to:
- Financial
- Strategic
- Operational
- Hazards
The objective of risk management is to add maximum sustainable values to all activities of the organisation. It increases the probability of success and reduces both the probability of failure and uncertainty of achieving the overall objectives of the business.
Risks should be reviewed both from an external perspective as well as reviewing internally within the business. Reviews may include what external factors will impact on the business, how do different operations and processes interact, what happens if key facilities and people are not available, when would we be unable to operate and what if the unlikely and unexpected actually happened? In a nutshell, risk management is good management.
Irrespective of whether strategic or operational, the budget should be broken down into bite-size chunks, reflecting the business planning decisions relating to overheads, profit and capital expenditures.
From an operational perspective, a cash flow forecast should be based on the programme of the works and should include preliminary monitoring, milestone payment dates and agreed valuation periods and submission dates. Communication is identified as a key driver, as in the event of predetermined risks becoming actual risks, it is imperative that dialogue is undertaken with the client to both mitigate these risks where possible, and if not possible, agree on how they will be managed. Once again effective record keeping is of paramount importance in the commercial process.
The majority of works undertaken on building and construction sites in the UK is carried out by small and medium enterprises, in many cases on large contracts, working for a large main contractor. It is therefore essential that effective relationships are developed and nurtured with all those within the supply chain, who may include specialist designers, installers, material suppliers or accreditation organisations to whom approvals and sign off is required.
As with cash flow, effective communication is central to maintaining good relationships. The power of a positive cash flow should never be underestimated, particularly when evaluating material supply and subcontractor procurement. It will be prudent to periodically undertake material cost evaluations and particularly in 2021, where many of the raw materials of the industry have financially increased considerably, which substantially affects both the production and commercial aspects of a project.
The evaluation of the relationship between costs and value being produced is potentially the most important process in the construction project. It should be carried out on a regular basis (monthly) to establish the financial position at that time.
The below process should incorporate all members of both the operational and commercial personnel to ensure effective collaboration between all the teams.
Areas for review may include but are not restricted to:
- Staff
- Subcontractors
- Plant
- Vehicles
- Overheads
- Materials
- Direct employees
- Variations
- Contribution
Risk is inherent in every action that we undertake whether in our personal lives or within our business undertakings. The important aspect is identifying these risks well in advance, to ensure there are no negative impacts in the event of them occurring. Within the construction sector, risk can be broadly categorised into four main headings, although they are not restricted to:
- Financial
- Strategic
- Operational
- Hazards
The objective of risk management is to add maximum sustainable values to all activities of the organisation. It increases the probability of success and reduces both the probability of failure and uncertainty of achieving the overall objectives of the business.
Risks should be reviewed both from an external perspective as well as reviewing internally within the business. Reviews may include what external factors will impact on the business, how do different operations and processes interact, what happens if key facilities and people are not available, when would we be unable to operate and what if the unlikely and unexpected actually happened? In a nutshell, risk management is good management.
