Automation and Supply Chain Management in Construction

by Procurement Freelancers Team

There are various challenges associated with supply chain management in construction. Real-estate firms need to understand these challenges. In this way, they can get proper know-how of the market situation. Consider yourself as a top rank executive in a real estate firm. Now, what would you do to manage the supply chain? If you want to handle the supply chain effectively, you need to assess the breakdown and movement of all parties, activities, and information involved in a project.

How Automation is Looming Large in the Construction Supply Chain Arena

Supply chain management in a construction project is not an easy task for individuals. However, you should remember the fact that managing the supply chain will lead to razor-thin profits. But, you can improve the efficiency of your business. In this case, you have reduced the chances of incurring losses.


A large number of modern-day organizations are resorting to procurement operations to reduce their production costs. If the production costs are lowered, the prices of goods and services will also be lowered. This will lead to more number of consumers buying a product or service. Indeed the sourcing scenario relating to a particular destination does not remain the same all the time. Marketers are having a tough time because of cost variations and fluctuations in the market environment. If you want to engage in procurement activities, you cannot neglect the delivery aspect.

When you issue a purchase order, it has to go through many approval levels. This causes delays in the process. Also, it leads to an increase in construction costs. Being the owner of an organization, you should try to make the process transparent. In this way, you can shorten your organization’s procurement cycle. If you automate the sourcing processes of your company, the contractors of your real-estate firm will keep costs minimum and thereby, shrinking internal bureaucracy. Automation will also help you to collect and track important data. This will help to project the future growth for your organization.

Accounts Receivable Management

It is undoubtedly the most important asset in a real estate firm’s balance sheet. If you handle accounts receivable properly, you can be assured that the supply chain of your company will run smoothly under all circumstances. In the construction industry, the problems relating to late payment cycles and delinquent accounts are very common.

With the advent of automation in the construction industry, contractors are protecting their payment rights efficiently. They can also take steps against non-paying clients. In previous times, marketers used to go with a collections agency for managing problems relating to the payment. Nowadays, the scenario has changed as the companies had to incur large costs.

Inventory Management

Automation has made its mark in inventory management. This is proving beneficial for both contractors and suppliers. You should try to maintain a well-managed inventory for your organization. Instances are there real-estate companies that handled its inventories properly have achieved success in construction projects. Apart from getting access to the right suppliers, companies need to channelize their procurement operations. This streamlining of sourcing operations should be grounded on inventory data. If you cannot cope up with the process, your organization is very likely to incur losses.

Automation in inventory management has accelerated the work of many employees. It has also simplified the job role of inventory executives. In previous times, the tasks of facility and inventory managers were prone to errors. Not only it affects the supply chain processes of organizations but it also hampers operations in other departments. Inventory management automation also plays a great hand in job costing, cash flow management, and implementing change orders.

What is the Future of Automation in Construction?

You need to realize that there is every chance of improvement in the construction industry. The advent of new technologies has made things easier for contractors and suppliers. You can expect more advanced tools shortly. This is the very reason why a large number of organizations are shifting towards innovation. Companies need to adopt new technologies for future growth.

Automation is very likely to play a great hand in the construction arena. It will bring transparency to the supply chain processes of real estate firms. There is no doubt about this fact. Be it procurement, supply chain, and inventory management, automation is bound to transform the operations of organizations at large. You must be open to changes while being eager to learn new things. If you implement automation in the supply chain process of your organization, you can reap increasing benefits.

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1 comment

Mohammed May 26, 2023 - 7:44 pm

Mostly prifly explain procurement supply management


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