Infrastructure is on the minds of everyone, from politicians in the nation’s capital to families avoiding potholes on the way to work. The government’s 2021 Infrastructure Bill manifested this widespread consciousness surrounding infrastructure. The Bill will see an investment of over $1 trillion into the USA’s roads, bridges, railways, and ports.
This substantial infrastructure investment coincides with global market growth in construction. Despite the pandemic, the construction sector saw 2.7% growth in 2020 and grew by 6.2% in 2021. Experts predict that the growth average will be 4.9% through 2025.
For construction companies to make the most of the current opportunities, they need to secure government contracts and expand their fleet to meet the demands of the growing market. Project efficiency and modern equipment give companies the best chance at securing profitable contracts and completing them on time.
Federal Contracts Drive Industry Growth
Once public project contracts open, private company bidding begins. Large construction companies become federal or state contractors when they win a bid for government projects and funds. These large companies usually bring in multiple sub-contracted companies to assist with every project level.
Government contracts are different from private contracts because they have substantially more regulations and reporting requirements. The original construction company is responsible for following the rules and reporting, and even sub-contracted companies may have extra reporting work that has no parallel in private contract work.
Government regulations surrounding material procurement complicate an already issue-latent supply chain. For instance, the Federal Acquisition Regulations have stipulations about imports and specific materials that must be domestically sourced.
Government-contracted companies need to start thinking about material sources. They have fewer material sourcing options and less negotiation standing to get delay clauses in the government contracts.
Investing in updated construction equipment is one-way companies interested in securing government contracts can get ahead in material sourcing. While companies cannot know the exact materials they will need for specific government contracts, they can predict what equipment they will use.
Modernizing a fleet of construction equipment is a dual-purpose investment that prepares companies for large government projects and enhances their ability to complete all private contracts. An updated construction fleet gives companies a material edge to win a contract bid or sub-contract by ensuring they don’t have outdated or poorly functioning equipment.
Efficiency is Imperative
When a construction company becomes a state or federal contractor, they come under greater scrutiny from the general public. As a result, they must ensure they operate efficiently and adhere to reporting regulations. The public funds government projects, so the news media and the public carefully monitor if projects stay on time and budget.
Unfavorable statistics
It is no secret that generally, the construction industry has struggled to deliver timely and cost-effective projects. 80% of large construction projects finish over budget, and 20% go over schedule. Old management styles and inefficient resource acquisition significantly contribute to these statistics.
Solutions
The infrastructure bill allocates $100 million to states for modern construction management systems. The goal of the funds is to boost the adoption of management systems that account for every step of a large project to increase productivity and reduce cost overruns.
Global materials suppliers and construction companies can do their part by supplying geographic areas with bulk supplies necessary for projects common to the site, which raises efficiency and lowers logistics costs.
In the context of heavy construction equipment, which will be an essential part of the infrastructure work, Monk JCB provides geographic-specific equipment.
Based out of Houston, Texas, Monk JCB has heavy construction equipment that both large and small construction companies need to complete all the projects in their portfolios.
Build Your Fleet Today
The market and infrastructure bill combine forces to create significant work for construction companies and contractors. The White House estimates that the infrastructure bill will create two million jobs a year over the next decade.
Even without the infrastructure bill, the growth in the construction industry creates significant demand for construction workers and heavy construction equipment.
At Monk JCB, we carry the full line of JCB heavy construction equipment characterized by eco-friendly fuel consumption, user-oriented dimensions, and unparalleled strength. JCB equipment with under 75 horsepower does not require DEF, which increases uptime and decreases maintenance costs. 46% larger cab sizes increase worker productivity and efficiency by improving operator comfort.
Monk JCB knows the future of construction requires businesses to have dependable and powerful construction equipment, so we provide you with just that. Contact Monk JCB today to learn more about our equipment, so your business is ready for the construction boom.
