Protecting Your Profits: Yet Another Helpful Tip

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A phone call I recently received brought back to me an issue that, for contractors, comes up often, yet unpredictably. That is, the escalation of costs of materials to be incorporated into a project between the time a bid is submitted and the time the work is completed, whether that be steel or concrete price increases for general contractors, drywall costs for drywaller specialty contractors, or copper price increases for electricians.

So, what can contractors do? Or are they powerless to head off what could be a devastating blow to the bottom line? Actually, contractors of all levels and trades have a tool at their disposal to counteract a possible material price time bomb. With proper crafting of a price escalation provision in bids and contracts addressing the possibility of significant price increases, construction professionals can reduce or eliminate entirely the costly impact of price escalations. Like a doctor providing an inoculation shot, with proper planning, contractors can employ this antidote to protect their hard-earned profits.

As always, we are prepared to assist you in protecting your profits and look forward to helping you with this issue, or any other issue, concerning your construction projects.

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Harrisburg Magazine Readers' Choice 2011