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How To Avoid Simple Mistakes When Managing Project Costs

5 min read

When managing a busy project, there’s so many aspects to keep on top of, that occasionally small details can slip between the cracks.

One thing that can easily get out of hand if not monitored correctly is cost, as careful time tracking, and budget planning is needed to keep it on the right path.

Getting on top of cost management will avoid your project overspending and having to send a bigger bill to your client, which could ruin the relationship or erode your profits.

Here are some ways to avoid simple mistakes with cost management:

Set a forecasted cost as early as possible

An accurate forecasted cost is an important statistic to work out before beginning work on the project.

This will help to ensure the quoting process goes smoothly to avoid issues with large quotes or cost overruns, which can be frustrating for the client.

Trying to come up with a new set of forecasted costs each time you begin a new project is hard work and can easily lead to human errors.

However, if you have a good project management system it’s much easier to forecast how much work, materials and labour will end up costing, because you can quickly glance at previous, similar jobs.

Being able to see what you have forecast before and compare that with how it worked out in reality will help to make a more accurate estimate.

Don’t be too rigid with your costs

Developing a budget based on the forecasted cost is a good idea – but be sure to account for variables and maybe even plan for inflation on a long-term project.

Being too specific and trying to estimate your timesheet down to the last second is unadvisable, as you will be unable to foresee any future problems at the start of a project.

Therefore, when handing over your estimate, ensure that you have budgeted a little extra to be on the safe side.

Don’t try and do it all by hand

It is important to remember that technology was invented to make our lives easier.

A high-quality project management software can do more than just show you today’s to-do list.

Choosing a software like Synergist can keep your costs on track by notifying you when you are in danger of going over budget, allowing you to make changes before this happens. It can also save you time by storing information, which can then be used to draft invoices later on.

Missing time

Using a workhours calculator is incredibly important to help monitor how much time, and in turn money, is spent on a project.

If minutes are going unaccounted for, the pennies can quickly become pounds and eat into your profits.

Implementing an online timesheet into your business could help to get time tracking under control, as this system is then easily accessible, and the data is all collated in one place. A good system like this will help to highlight what is missing.

Making these changes should ensure that your process is as streamlined as possible so that you are on top of your game when it comes to project cost management.

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