Construction Software Can Help You Prepare Your Business for Success

Since mid-2022, growth in the New Zealand construction industry has been slowing. For the year ended March 2023, total construction output (as measured in GDP) rose by 4.4%, a decline from the 6.3% growth rate recorded in the previous year. Residential construction growth declined by a larger measure than non-residential construction, down 2.2% in the December 2022 quarter. This slowdown is due to factors such as inflation, rising interest rates, and higher construction costs.  

However, the value of non-residential work has surged, increasing by 28.3% in the first half of 2023, up from growth of 7.3% in the previous year. Growth in this sector will continue thanks to the substantial investments announced in the May 2023 budget, which allocated $71 billion for infrastructure spending over the next five years. This includes significant funding for schools, hospitals, public housing, and rail transportation.  

And while these investments are good news for New Zealand construction companies, the industry faces pressures. Access to skilled labour remains the predominant concern, followed by higher costs that are eroding profit margins and ongoing supply chain issues. Additionally, construction companies are facing a rise in overdue debtors, indicating increased financial stress across the sector. While the Construction Cost Index saw a slight decrease of 0.6% in the June 2023 quarter, labour costs continued to climb, rising by 4.2% in the year ended June 2023.  

Productivity issues persist within the industry. Studies by the New Zealand Institute of Building have highlighted entrenched behaviours and practices, lower rates of innovation, and high injury rates as contributing factors to lagging productivity. 

Construction businesses that capitalise on technologies that improve efficiencies and streamline processes will be able to improve margins. You can manage cash more effectively using software that’s made for construction. With easy to use invoicing features, you can keep more cash on hand and pay your suppliers more quickly and avoid higher interest rates.   

Construction has traditionally been a late adopter of technology, and that has cost the industry in productivity and efficiency. But now, thanks to pervasive mobile devices and high speed internet, it’s easier than ever for construction companies to take advantage of technology to streamline operations. Construction software supports better collaboration and reduces the risk of complex jobs exceeding their timeline. Additionally, using a single source of shared data can decrease miscommunications and rework. 

Construction companies often manage several projects on different sites, which means the industry is characterised by remote work that’s carried out by diverse teams. For better communication and collaboration, it makes sense for everyone to work with the same data, especially since construction generates a significant amount of data. Using a single system (like Nimbus ERP Software)  to run your business helps you share data across all your departments and eliminate time wasted importing and exporting data. You’ll also be able to improve communication, reduce work stoppages that result from lack of access to information, and break down silos in your company.   

When you’re looking for construction software, you’ll want to ensure there are solid tools for document management, project management, and remote timekeeping. Additionally, you want to ensure your software includes robust and flexible reporting capabilities so you can capture the status of any project or invoice at any time. 

Construction ERP allows you to plan, schedule, and manage jobs more efficiently, so that you can maintain tighter cost controls and preserve your profit. The ability to track and handle all your updated data helps you make better business decisions when you need to. Using a single system to run your business efficiently means you will improve your everyday processes like estimating, scheduling, project management, and accounting. With faster and easier invoice tracking, you can keep your cash flow positive, and run your construction business more competitively. 

Release date: 18th January 2023