6-step construction project start-up checklist

Here’s a 6-step construction project start-up checklist that will help you stay on track.

All great projects start with a plan – and your next construction job is no different. A plan focuses your efforts. As each phase passes, you can line up the right materials, equipment and people to keep things ticking along.

Without a plan, unexpected costs and delays can creep up on you. By mapping everything out – from start to finish – you can avoid obstacles and prepare for challenges up ahead.

In this guide, we take you through the following construction project stages:

  1. Nailing your bid and perfecting your proposal
  2. Crafting your roadmap
  3. Budgeting and expense management
  4. Planning your approach
  5. Executing and monitoring
  6. Finishing touches and closing out your project

Nailing your bid and perfecting your proposal

The first thing you need is a simple, repeatable proposal process to make construction project start-up processes easy. There are plenty of proposal templates online that you can use as a starting point. Just make sure you tailor them to each bid.

Include information such as the scope of work, material and labour costs, project timeline, and information about how your business operates. Suggest a payment and work schedule, too.

A competitive bid proposal requires accurate numbers. This is where your expense records come in handy. You can use them to calculate how much materials, equipment and labour cost, so you can provide realistic figures for your client.

The tricky part is striking a fair balance between competitive pricing and profitability, so make sure you’re clear on how much the project execution will cost you.

When companies are seeking bids (also known as bid solicitation), pay close attention to the requirements and project delivery methods. Targeted, tailored proposals stand a better chance of landing with the client. Making sure the project is a good fit for your team matters – so think carefully before submitting.

And if your bid strikes a chord with the client, you’ll need to collaborate on a contract. Here, you can iron out the details on pricing, deadlines, milestones and delivery. Make sure you prep these items ahead of time so that when you win the bid, you’re ready to firm things up.

To recap the first phase of starting a building project:

  • Fill in the blanks on your template proposal document
  • Use your expense records to calculate costs and provide accurate figures for the client
  • Review the project requirements to make sure it aligns with your ways of working
  • If the project’s a fit, sign on the dotted line

Crafting your roadmap

After you’ve won the project, it’s time to build a roadmap.

This is a timeline of tasks, responsibilities, milestones and deliverables. You might find a project management system – such as a Gantt chart – useful for tracking these items.

Your roadmap is an essential piece of kit. It will help you identify dependencies in your project schedule, avert obstacles, mitigate risks and conserve resources.

Make sure you include your subcontractor requirements in your roadmap, too. You may not need all teams on the construction site from the get-go, so try to spot who’s needed and when.

You don’t have to tackle the entire project in one go – break it down into phases instead. For example, you could create your roadmap for the pre-construction phase first, then procurement, then site construction.

Before you have boots on the ground, set up some performance metrics. This will help you evaluate the success of your project and determine what you should do differently next time.

Popular performance metrics include: profit margin, cost performance (how closely you stuck to the original budget), safety incident rate, and rework cost (money you may be able to save next time with better planning).

But you can use whichever metrics feel best for your business. If you’re trying to improve the quality of work, you could focus on rework costs. If you want to take a higher percentage from your projects, focus on your profit margin.

To summarise the second phase of starting a construction project:

  • Create a roadmap of tasks, responsibilities, milestones and deliverables
  • Figure out which subcontractors you need at each stage of the project
  • Break down the project into phases – like pre-construction and procurement
  • Decide on some performance metrics to measure your success

Budgeting and expense management

Once a construction project is in motion, the expenses will quickly pile up. It can be hard to keep tabs on this, but staying on budget is essential if you want to maintain a healthy profit.

Blowing your budget can impact your construction cash flow for months to come.

Overspending on one building project means there’s less in the bank for your next client. It’s one of the reasons why construction projects fail – not enough cash to sustain the build.

So a realistic and well-managed budget is key. You can create a fair budget by using your past spending data. Look at your expense records and factor in any changes in supplier and contractor pricing. Use these figures to calculate your project costs.

Once your budget is set, you need to keep an eye on it throughout the project. Track your costs and expenditures with job costing software, so you don’t have to tot the numbers up yourself.

This software also allows you to generate quotes on the go, based on past figures, so you can always charge your worth.

For even more functionality, try the Workguru app. You can manage everything from inventory and project roadmaps to quoting, invoicing and forecasting. Customiseable project templates mean you can send professional-looking quotes and invoices without spending hours on them.

To round up this construction project start-up phase:

  • Create a realistic budget using your expenditure figures and factor in supplier and contractor pricing
  • Automate budget and expense tracking with job costing software
  • Expand your view with apps like Workguru, which equip you with quoting, invoicing and forecasting tools

Planning your approach

Armed with your project roadmap, it’s time to make a plan.

Your roadmap should lay out the ‘what’, whereas your plan should lay out the ‘how’: How will you deliver each phase of the project? How will you manage materials and subcontractors?

How will you go about meeting regulatory requirements?

There are multiple factors to consider. Here are some elements you should address before starting a building project:

  • Workforce: When and where will you need subcontractor support? Using your project roadmap as a timeline, figure out when you’ll need to onboard workers.
  • Materials and equipment: Create a construction list of the materials and equipment you need for each phase of the project, and use a cash flow forecast to work out when to purchase them.
  • Permits and approvals: Before you start work, you must have the right permits and approvals for your site in place. It can take time for these to come through, so apply as early as you can.
  • Risk management: How will you identify, log and mitigate risks during the project? Make sure there’s a clear process for the entire workforce to follow, so you can keep people safe.
  • Health and safety: Which safety protocols and regulations do you need to follow? Do you have the correct PPE in place and an emergency response plan in your safety management strategy?
  • Quality control and assurance: Give some thought to the quality standards and specifications you’re aiming for. Which inspection and testing procedures will you use to ensure the finished build is up to scratch?
  • Environmental impact: How will your construction impact the local environment? Check which environmental regulations apply to you, and make sure you're set to meet them. Explore sustainable construction approaches for a more environmentally friendly build.
  • Communications: Who should report to whom, and how are messages communicated with stakeholders? Decide on the channels and frequency of communications up front, so everyone is on the same page.

Mapping each task on a Gantt chart can help you build a realistic timeline, and identify what needs to be addressed first in your building projects. For example, you may discover you need a team of subcontractors to clear and prepare the site, and rent diggers and forklift trucks for the entire duration of this phase.

Planning your approach means you can see when and where equipment, materials and people are needed. Sometimes, it helps to work backwards. Start with the delivered project and note the stage before it. Keep working backwards until you reach the first stage.

Let’s recap the planning stage of your construction project:

  • Include key elements in your plan, such as workforce, materials, permits, risk management, and health and safety
  • Use a Gantt chart to build a realistic timeline and see what needs to be tackled first
  • Work backwards from your delivered project to figure out each step

Executing and monitoring

Behind the scenes, you should be monitoring a range of activities and keeping up-to-date records – especially of your costs.

Most building projects combine hard costs – like equipment, materials and labour – which directly relate to physical construction, and soft costs – like construction project management, permit fees and inspection – which contribute to the project as a whole.

To ensure you’re supporting your profit margin, it’s important to compare your budget with your actual expenses. Use cloud-based accounting software to create cash flow forecasts based on live expense data, so you have a clear view of the financial health of your construction business.

Setting up a payment schedule with your client can help with your cash flow management. A payment schedule is a timeline of payments between construction businesses and clients. Instead of paying one lump sum, clients pay a percentage of the project cost at each phase or milestone – depending on what you agree.

Some other aspects you’ll want to monitor are: inventory (so you have the right materials ready at the right time), legal and regulatory compliance (to make sure you’re delivering the project in line with laws and guidance), and your performance metrics (so you’re on track to deliver a successful and profitable project).

Monitoring doesn’t always need to be manual; you can automate it with accounting software and project management software. Track inventory and expenditure in Xero, or try one of our construction apps like ServiceM8 to track project progress and outstanding tasks.

Let’s recap this construction project start-up stage:

  • Track hard costs and soft costs, inventory, legal and regulatory requirements, and performance metrics for a complete view of your progress
  • Compare your budget to your actual spending and use a cash flow projection to prepare for future cost overruns
  • Set up a payment schedule with your client to help with cash flow management
  • Automate monitoring activities to save you time and improve accuracy

Finishing touches and closing out your project

Construction is complete, and you’re almost ready to hand over the keys.

After completing a final inspection and quality control checks, you may need to make some tweaks and ensure the building meets the original project specifications and building regulations.

Make sure systems, equipment and components have been tested in line with specifications. Take photos of your work as evidence – you may also be able to use these to market your business in the future.

It’s time to close out the finances, too. Check your budget against your actuals to see how well your project has performed. Settle any outstanding payments, invoices and claims with suppliers, contractors and subcontractors.

Then, meet with the client to share documentation, pass over the keys, and share any information relating to the use of the building that hasn’t been covered already. Talk about the successes, challenges and lessons learned. Make sure everyone is satisfied with the outcome.

Process final payments and ensure the client has settled their bill. Then, run an end-of-project review with your teams to analyse what went well and what needs improvement for next time.

The final construction project start-up stage in a nutshell:

  • Complete a final inspection and fix any issues that crop up
  • Close off the finances – check your budget against your actuals to assess the project’s financial performance, settle outstanding bills and process final payments
  • Meet with the client to exchange keys, codes and documentation
  • Review the project with your clients and teams – take note of things to improve for next time

How to track costs effectively during a construction project

The UK construction industry is under enormous financial pressure. Maintaining a healthy cash flow can give you a little extra breathing room when things don’t go to plan.

Using accounting software for construction and trades to manage costs and track budgets will help you stay on top of the financials. And if you'd like to get paid faster, take a look at Xero’s online invoice payments through Stripe and GoCardless. They give your customers more ways to pay and can help keep your cash flow in the green.


Xero does not provide accounting, tax, business or legal advice. This guide has been provided for information purposes only. You should consult your own professional advisors for advice directly relating to your business or before taking action in relation to any of the content provided.

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