Construction Financial Manager Review: August 12, 2016

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This week’s Construction Financial Manager Review broadly addresses recent developments and topics of conversation in the construction industry. We try to provide you with major headlines and interesting insights to keep you on the cusp of industry news. We hope you enjoy this week’s review and would love to get your feedback.

Happy weekend,

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Scott Wolfe
zlien CEO

What We’re Reading 
Key Articles from Across the Web This Week

There’s a home renovation boom, but good luck finding a contractor
With rising home prices and low interest rates, Americans are spending a record amount of money fixing up their kitchens, bathrooms and man-caves. And business would be booming more but there aren’t enough carpenters and tradespeople to do all the work. Read the full article on NPR.   

Construction adds 14K jobs as employers boost wages, weekly hours amid labor shortage
According to BLS data, nonresidential specialty trade contractors saw the most month-over-month growth, adding 8,900 jobs (3.3%) since June, while residential specialty trade contractors had the biggest year-over-year surge at 5.1% (90,700 jobs). Read the full article on Construction Dive.  

How increased infrastructure investment captured national attention – and what it means for the construction industry  
The construction industry has found itself in unfamiliar territory. For a sector typically relegated to the back of people’s minds — only coming to the forefront during road construction or bridge closure annoyances — the industry is seeing a different kind of public outcry. Read the full article on Construction Dive.   

Augmented reality could speed up construction projects
More than one subcontractor or material supplier has lost money for nonpayment on construction projects. Because there are often a flurry of bonds you become party to when taking on a project, you might incorrectly assume you have recourse other than litigation when you don’t get paid. But subtle wording in bonding documents, strict requirements for filing mechanic’s liens, and evolving case law and state statutes can leave you out in the cold. Read the full article on MIT Technology Review.

Watch the incredible transformation of Rio’s Olympic stadiums, in time lapse
The 2016 Olympic Games got off to a spectacular start on Friday, Aug. 5. Despite earlier reports that the city was still a huge construction site, Rio’s Olympics public relations group tells Quartz in an email that all stadium constructions are now “100% done,” excepting a few serious glitches at the Olympic villageRead the full article on QUARTZ.  

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What We’re Writing About
Recent Articles by zlien Relevant to Construction Finance

Drones in construction: Current and future uses 
It’s easy to envision utilizing drones for a multitude of uses. Companies like Skycatch are already using drones to map construction projects with extreme accuracy. Others are combining innovative software with drone technology to create 3D mapping complete with color and all. Even the NBA’s Sacramento Kings have embraced drone technology on the construction of their new stadium. Read the full article.  

How to reduce DSO of construction invoices 
Credit teams in the construction industry constantly battle late payments. In particular, subcontractors and suppliers performing labor or supplying materials to help permanently improve a property are farther removed from the money behind the project, and, therefore, must often deal with dreaded DSO (Days Sales Outstanding). Read the full article.  

How subcontractors can grow business by minimizing risk  
Small subcontracting firms looking to grow a business may be afraid to take on larger, higher-paying jobs for a few reasons. These jobs typically require a larger cash outlay, and the contracting firm often gets paid incrementally through installments over weeks or months. This can wreak havoc on cash flow — and then there’s the greater risk that the client won’t pay at all. Despite the credit-heavy nature of construction work, there are several ways subcontractors can grow business while minimizing their risk threshold. Read the full article.

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