… Get your subcontractors submitting claims in a pre-agreed format that you love and that they find incredibly easy to prepare
Once a project’s underway, many construction companies get overwhelmed by the sheer effort of managing the payment claim process. It’s at least as difficult (in proportion) for the many smaller businesses that represent your subcontractors.
Fortunately, there’s a smarter (and less risky) way to work for everyone – and it doesn’t involve changing your accounting practices, installing software or changing your compliance practices.
Collaboration and automation of the payment claim process will remove many of the issues and hassles you currently face: claims in multiple formats, constant chasing of claims, calculation and reconciliation errors, double data entry.
As a result, it will reduce the amount of unnecessary time you spend on the payment claim process, especially spreadsheets and endless email trails. This means you can focus on what really matters, managing the build!
Many ERP or project control systems used in the construction industry pay ‘lip service’ to payment claims and contract administration, but few go the full mile by allowing subcontractor collaboration and automating the sheer effort involved for everyone. This means that the only truly effective way of automating them involves a specialist, dedicated solution that facilitates collaboration between all parties and also integrates with other software.
From our research in conjunction with the Australian Construction Industry Forum, construction companies on average are spending 529 hours processing 28 claims per month via traditional methods.
With specialist software, this is reduced to 112 hours per month – a 78% reduction in time!
Importantly, what are your risks of Security Of Payments Act non-compliance; contract exposure, litigation, adjudication, project downtime or other legal action if your payment claims processes are inefficient and inaccurate?
By automating the process and making it collaborative to your contract counter-parties, the time saved will improve your own internal productivity, ensure disputes are minimised and allow for more focus on supporting project delivery and reporting.
Collaborative payment claim automation is designed to benefit both contractual parties. It not only makes administration of the entire process much easier and more reliable for construction companies, it also helps ensure that subbies fully understand what they’ll be getting paid and when. This complete transparency creates a level playing field – reducing suspicion between parties and making for win/win partnerships.
There are plenty of examples of subcontractors who, after working for a builder that has implemented a more efficient system for managing a repetitive, admin’ task, have adopted the system themselves to manage all the companies they subcontract to – whether or not these companies use the same system.
And it just so happens we have an example right here!
So don’t worry about technology fear and resistance from ‘old school’ subbies – they all use smartphones already. If they can download an app, they’ll be able to use automated payment claims! In fact, it will be much easier for them than messing about with spreadsheets and navigating email trails. You’ll be surprised how quickly they’ll embrace the technology once they realise it can help their own cash flow and forecasting.