Construction is unique. Unlike other industries, you sell an item before knowing the ultimate cost. Currently, pricing risk is increasing due to inflationary pressures, which is now a main topic of concern amongst industry leaders.
“Pricing risk determines profitability, and ultimately the success of a construction company. As a company, you want a long-term positive return for the risks you take. Managing pricing risk appropriately is a long-term survival tool. If you don’t do it well, you’ll be out of business,” says Tim Holicky, a senior executive underwriter at The Hartford.
“Construction is a business that prospers under discipline and diligence.”
While there is still uncertainty surrounding pricing risk, here are ten best practices that can influence the outcome of a project and increase your success when selecting projects.