While either option works to some degree, increasingly construction companies are opting for specialist construction software instead of relying on generic solutions.
The business benefits of this choice are numerous. Let’s take a look at some of them.
#1 Long term cash flow management
Payment structures in construction aren’t as simple as receiving payment when the goods change hands. Payment is often received in multiple stages, with retention usually withheld for up to 12 months after completion. Generic software packages may struggle to take these payment nuances into account, meaning that you could be left with a significantly unhealthier cash flow than expected if you haven’t taken them into account in your system. Whatever the payment structure documented in your contract, your software should be able to manage it.
#2 Significantly reduce time spent on paperwork
Generic software rarely allows for business functions such as CIS verification or cost value reconciliation – both crucial, yet time consuming processes for construction businesses. If you choose to go with a generic accounts package, you have two choices to overcome these obstacles: spend time developing workarounds such as spreadsheets, or pay for an add-on package from your software provider.
Clearly both options are a hassle. Specialist software will contain all the features you need without having to ask for them. CIS verification, CVR, and numerous other features will slash admin time and increase the hours you can spend in more productive areas of your business.
#3 Less downtime
Dealing with any company’s support team can be a frustrating experience – but none more so than when the success of your business is on the line. When you encounter a problem with your software, it’s vital that you resolve it as soon as possible. The support team of a generic accounting system may be unable to get to grips with a construction industry specific problem that’s been plaguing your team. You risk having to speak to several support reps before you can find a solution.
Alternatively, if you call up the support team of a specialist software provider, you can be confident that they understand the nature of your business.
#4 Improved management and planning
Job costing software lets you drill down to the source of each and every cost, providing invaluable data that you can use to help plan and shape the future direction of your business. By understanding problematic and profitable areas of individual jobs, future management and business decisions become far easier. Many generic software packages simply don’t provide this level of detail to managers. When coupled with the ability to manage retention and applications, job costing makes business planning in the construction industry far easier.
If these benefits of specialist software have left you doubting your current system, the switch is easier than you might expect. Check out our seven step guide to upgrading your construction software to get started.