How Purchase Orders Are Helpful On Construction Sites

How-to-make-your-Construction-Project-an-Effective-Working-ProcessA lot of effort goes into planning a construction site. Just ask any construction CFO that has to submit analysis, projections and plans months before the project even commences. It’s no wonder the CFO is nicknamed Ruler of Results.

Not only is there a lot of planning that goes into the construction site before the project starts but there are also unforeseen pitfalls that occur after the construction site is bustling with work. For a construction CFO or project manager who is already on edge by having all their balls in the air, even the slightest thing going wrong would be too much to handle.

In, steps the purchase order!

It is not the beauty of the building you should look at: it’s the construction of the foundation that will stand the test of time’ – David Allan Coe

Purchase orders are man made saviour’ for any project. They save project managers a lot of time and keep the different functions in a project unified under one umbrella while the project runs its course. For instance, they help to track costs of materials that are needed on a daily basis or detailed progress on different phases of the project. They contain everything you need to keep track of project costs at any given time.

The construction industry grows rapidly every year due to high oil prices and the growing population. As a result, there is limited control of costs and the workforce skill level. Additionally, recent economic shocks are forcing the construction industry to watch costs closely and tighten operations. Processes like manpower and procurement can be managed more efficiently through a more structured approach by centralizing functions and keeping a closer controlled eye on purchases.

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Procurement on a Construction Site

Procurement makes up 60% of the costs of any project. Taking this into consideration, it is important to reevaluate certain areas like spend control, approvals processes and the use of technology to management processes more efficiently.

Spend Control

It is imperative to analyze your spending processes and ask the hard questions:

  • What type of product is really needed?
  • Are the suppliers reliable?
  • Can spending be reduced in some way?
  • What would be the best terms for each product to reduce costs?

Spending money should be fun, but instead, we are faced with mountains of worry every time the word ‘spend’ is mentioned. If you are like me, you would prefer to spend your time making sure your projects run smoothly and not have to worry about where your funds are going missing. 10% of all spend in a company is wasted spend.

Procurementexpress.com on Spend Control

Introducing our Purchase Order app to your project will help your company achieve sustainable growth through efficient spend management. Procurementexpress.com puts the fun back into your spending! It controls the spending while you focus on other aspects of your project like unforeseen pitfalls and personnel management. How does the app achieve this? Well, here are a few ways:

  • You never have to wonder what has been spent on what and by whom.
  • Reports are updated in real time and can be downloaded at any time.
  • Vendor management – so your team can’t use suppliers you don’t like.
  • You can view the budget remaining per project before purchases are approved.
  • Set up custom fields so you can report on what’s important to your company.

Approval Process

Centralizing the purchase order process reduces costs in many ways. It covers the finance and procurement departments and makes the flow of managing approvals easier. Under this combined payment terms and conditions can be set and all the parties involved know what these terms are and have access to each separate purchase order status at all times.

This eliminates mismanaged cash flow and missed payments which lead to the suppliers not delivering products on time, or even at all, and potentially causes projects to be put on hold.

Getting approvals for anything in a company can be very frustrating. In order to get a signature on a purchase order form you literally have to stalk the related executive or manager, whereafter it still has to go through more than one department before the purchase can finally be made.

Procurementexpress.com and Approval Process Control

With Procurementexpress.com, all purchases are run through a set approval routing process, whereby managers who make the decisions can approve all purchases with the click of a button.

  • Our efficient 1-click approval system secures every aspect of the process
  • It allows you to review all purchases before they happen
  • Approval rules can also be set per budget and project

Mobile

The right technology system can substantially improve procurement and has a range of benefits. It forces a culture of standardization that can easily be adopted by any of your employees. It ensures speed and efficiency and reduces man-hours on paperwork.  

Executives are always on the run from one meeting to the next. They hardly have time to enjoy a quick cup of coffee. We all know that you can’t get anything approved without the ‘executive’ million dollar signature and you need a GPS just to know where they are. In the executives’ defense, they can’t keep track of what each employee is up to when they are not around.

With a mobile app, when you are on the go, you are no longer tied to a desk computer. You can instantly see everything and can approve any purchase with the click of a button.

Procurementexpress.com is Mobile

  • Remembers everything so you don’t have to
  • Instantly sends you progress reports
  • Crew members or managers  can load POs from site
  • The app is available on Android and iOS systems

One of the biggest benefits of consolidating your purchase order process and using the same set suppliers for purchases are discounted prices for bulk order. A mobile procurement system minimizes internal bureaucratic forms and saves time.

How has using a Purchase Order system reduced costs on your construction site?

Get rid of the paper-trail hassle with inclusive online reporting that eliminates fraud.

4 steps to Simplifying your PO process (1)

Procurement Coach

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