Company Overview
Clearwater Construction Ltd, part of a New Zealand-based group of related companies, is heavily involved in large commercial construction projects. Within the group are three main operating companies—one focused on development and construction, another on steel fabrication, and the third on scaffolding. Together, these companies handle a variety of projects, from apartment buildings to medical centers.
Challenges
Managing costs, labour, and job performance across all three companies is the foundation of the group’s success. Angus Reeves, Financial Controller, also acknowledges that the three companies have distinct business needs and employ separate processes to handle job cost tracking, manage progress claims, and track and store invoices.
For the construction company and the steel fabrication company the priority is comprehensive, robust job tracking. “We couldn’t run the business without powerful job costing,” says Reeves. “That obviously includes all the labour costing, not just supplier and subcontractor costing.” The steel fabrication company needs and uses CostCon’s robust inventory management, although tracking inventory is not a major focus for the other two businesses.
The Group requires an integrated solution that can handle job costing, invoicing, and project financial management while maintaining the independence of each company.
Solutions
For many years the group has used CostCon’s comprehensive construction management software to address the various needs of its companies. Using construction management software like CostCon allows the group to streamline multiple processes across its diverse operations:
Job Costing & Progress Claims: CostCon’s job costing module empowers the Quantity Surveyors within the group to track costs accurately on a job-by-job basis. The job cost feature is just as valuable for the smaller subsidiary companies to help track which jobs are profitable. “If you’re making profit overall, that’s fantastic,” says Reeves, “but we need more granularity than that to dig in and follow the jobs in detail so we can learn from the jobs at an individual level.”
Scaffolding Integration: The scaffolding company faced a unique challenge in integrating the equipment rental charges into its progress claims. CostCon is in the process of developing a “new system where we can incorporate a monthly rental charge into the progress claims.” This new system will allow the scaffolding company to send consolidated invoices to customers, which will help to improve efficiency and save considerable administrative time.
Invoice Management with Scanlite: Clearwater has made excellent use of what it calls Scanlite, the tool from CostCon that digitized their invoice management. The company is now almost entirely paperless, with all its invoice data stored in a digital repository. Digital invoice scanning has resulted in significant efficiency gains, and Reeves intends to migrate Scanlite to another of the companies where it will improve accessibility and reduce manual intervention.
Inventory Management for Steel Fabrication: The steel fabrication company utilises CostCon’s inventory management module, which helps it track material usage and costs more effectively. This module is essential for the steel fabricator’s operations.
Fixed Asset Management: Reeves says that the group is mulling an implementation of CostCon’s fixed asset register to improve equipment and machinery management. Reeves says use of the Fixed Asset Register would be, “a more efficient way of tracking assets and storing information that would help the companies to improve the quality of the information overall.”
The Benefits
While the implementation and use of CostCon predates Reeves’ tenure with the group, he says using quality construction management software has resulted in several significant advantages.
Time and Cost Savings: Automated, accurate job cost tracking and integrated digital invoice scanning helps the company reduce administrative overhead. The scaffolding company’s new ability to include rental charges in progress claims should also save hours of manual work each month.
Improved Data Accuracy: Using CostCon’s job costing in all its companies allows the group to gain substantive insights into which jobs are profitable, and which are not. This granularity in reporting gives the companies the ability to make more informed decisions and helps improve overall business performance.
Seamless Customer Service: One of the biggest benefits from using CostCon is the ability to customize the system to meet the group’s specific needs such as facilitating a custom built solution for the scaffolding company to track rental charges within progress claims. CostCon’s responsiveness and willingness to adjust the software is one way it stands out from other larger, less flexible global packages.
Compliance and Reporting: With recent updates to New Zealand legislation that required specific reporting for retentions held on behalf of suppliers, CostCon quickly developed a solution that allowed Clearwater to meet its legal obligations. This saved time and ensured the company was compliant with new regulations.
Conclusion
Clearwater Construction’s experience with CostCon has been very positive. From job costing to invoicing and compliance, CostCon has helped the company streamline its operations, save time, and improve accuracy. Thanks to its flexibility and responsiveness, Reeves says his company is very happy with CostCon as the group grows and evolves. “We are very happy with the system. CostCon keeps up with our needs, and we don’t currently see any need to change.”
