Why Builders' Margins Relate to Risk
One major variable from builder to builder will be their cost margin. A recent study revealed that the size of builders’ margins actually have a direct impact on the risk of their business, and their customer’s projects.
When embarking on your own home project, it’s important to know the difference between what constitutes a ‘safe’ margin, and an ‘unsafe’ margin — it could be the first red flag that your own project is in danger.
Here’s what the study found:
Low Risk = Margin needs to be more than 20%
Medium Risk = Margin is between 12% – 19%
High Risk = Margin is less than 12%
Why does a low margin mean high risk?
Smaller margins mean that your builder isn’t considering unknown costs that can crop up over the course of your project. A lower margin for error creates a high-risk environment — these builders can often become insolvent (unable to pay their debts) which translates to a direct impact on their projects, sub-contractors and suppliers. This impact could include:
● Low project quality
● Unfinished or half-finished projects
● Mistakes are made and unable to be rectified
● Unpaid tradesmen
● Builders are not insured because their low profit margins put them in a high-risk category
● Bankruptcy, leaving families stranded and deposits lost
Don’t fall prey to a ‘great deal’!
Quite often families are lured by a tempting ‘great value’ with a cheap house and land package — but this can end up costing them a lot more than money with drawn out builds, high stress environments, and broken promises.
Our business model keeps you safe
With Jackson Dwellings you can build your dream home, and not worry about risk. Our experience in the industry and the margins we have established protect us against financial issues that may hinder project success.
We promise you:
● A higher quality home
● Structurally sound and safe
● On-time delivery
● Experienced and qualified staff
● Your home will be built following proven systems and processes — no broken promises
● Finishes and inclusions will be as agreed
● Fully insured for every activity on site
Contact us to speak with one of our experts to see how this information can benefit your project.
Testimonials
The team at Jackson Dwellings not only treated our home like it was theirs, but they also treated us like family. The attention to detail is incredible and the entire home is beyond what we had ever imagined
The lockdown, restrictions and uncertainty of 2020 are always at the forefront of my thoughts but the house build has been the shining light for us and I just wanted to say thanks. We are so happy that you are building our home
We love you guys and couldn’t recommend you enough to anyone who is thinking of renovating and/or extending. You listened to what we envisaged for our home and had great ideas along the way
100% there is no better service, no better level of respect for the client out there. Every aspect of our build was discussed, thought out and executed at the highest level. Thank you Jackson Dwellings
Thank you for being patient and understanding throughout the build and addressing any matters that arose. Our family will love and always remember this home
It was a wonderful building experience. Everything went smoothly and we were super delighted with the finished product. The highlight of the whole experience for us though was just how easy the team was to work with and the communication throughout the build. We were always in touch with Cam and the team and we knew exactly what was happening the whole time
The effort you go to and all the little things you do make it all come together smoothly and the result is a great finished product. We honestly cannot thank you enough for all you have done to give us our beautiful home
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