There’s this concept called the Cost Iceberg, which refers to the idea that like an iceberg, the total cost of an order might not be evident at first glance.
The iceberg is an oft-used visual metaphor, especially in the realm of spending.
Within the supply chain, several components must work together to ensure that a project runs smoothly. In construction, things are a bit more complicated, as every building project is different.
Contractors often finish out the year with less money than they expected. When you think about the moving parts of a large-scale construction project, it’s no surprise that little things eat into your bottom line.
Budgeting is, of course, one of the most critical aspects of running any business. Albeit, maybe not the most glamorous. A budget tells us what we can and can’t afford—and serves to inform our purchasing strategy. While a budget can warn us when finances spiral out of control, they can’t prevent us from buying anything.