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5 best cost management ideas to win over your client

5 best cost management ideas to win over your client

Presently, real estate in India is facing turbulent times as an industry. The industry is hit by a storm of rates sloping down, investment getting lesser yields vis a vis returns and a brand new regulation in the name of Real Estate Regulation Act, 2016. The effect of the industry reaching a plateau coupled with competitive technology, dwindling customer expectations and a new entrant each day will change the face of real estate in times to come.

With the above mentioned factors already impacting the industry, the industry as a whole is naturally running tight on margins. This has further brought the focus of most project managers on cost. Yet, squeezing a little percentage on raw material and cheap labour is not sufficient to sustain your relevance in the market. The top players in the industry have already geared up and are heading for an all round transformation not just in their strategies but also in operations. The idea is to win over the clients by giving faster, cost effective and innovative solutions which can ultimately cater to their needs.

It is pivotal to note here that the priority here is not to cut the costs, at least not at the cost of compromising on the quality. The crucial idea here is where the resources are channelized to stimulate growth and differentiate. Strategic cost reduction can be a real game changer in times to come. One can easily opt for digital transformation which can not only provide tailor made solutions for individual clients at a reasonably lower cost but also make precision of risk selection and pricing more sharp.

While advancement in technology is one of the best solutions to opt for, it is not the only one. One must create a clear distinction between low returns project vs. projects which might offer higher returns and channelise the resources accordingly. While doing so, one must figure out the fast growing geographical markets and costs associated with it. In fact, customer focus and innovation along with smart strategy implementation will be a key differentiator for you as a project manner.

However, in most cases, cost strategies struggle to survive. The core issue with real estate industry as a whole is that certain products will always be low on returns and being a highly competitive market, someone will always offer a cheaper property. Having said that, you must start with identifying the potential value rather than the output or costs. You need to be at a point where the quick costs wins are thrashed on the go leaving tougher roads ahead, wherein, what appeared to be a cost failure have turned out to be great projects. These strategic winners have led to dramatic changes in the business models, inclusion of technology and elimination of middlemen and certain other processes.

Thus, as stated above, cost management is not really about cutting costs. It is about focusing on optimisation, higher returns on investment and ensuring that the business remains relevant and is explored to the fullest of its potential. Here are 5 best ideas to help you win over your clients and not affect your revenue:

1. Strategise!

You need to develop and implement a strategy to keep a clear goal in mind. This strategy is required to be spread around, vetted and agreed by every team in the project to keep everyone on the same page. Keep this strategy handy as a blueprint, so that any time cost is being compromised on, one can go back to it and rectify the same.

2. Align!

For every strategy to work, one needs to align the costs to the strategy designed. Sure, there must be a margin for contingency, however, you need to ensure that the strategy is in place and the high returning costs are differentiated from the unessential investments with little or no returns.

3. Aim!

Shed your apprehensions and aim for a bold, achievable goal. You need to be brave and make the best choices for your business. You need to test or utilize as much innovation, technology and resources to radically optimise the cost and yield higher returns.

4. Lead!

Since you are designing a strategy and almost transforming the way your business would have traditionally functioned, deliver a programme and lead by being an example. Use that later as an excellent marketing strategy.

5. Create!

Clients are usually not satisfied unless your employees are. Therefore, ensure that there is a positive culture of enthusiasm, zeal, passion and ownership created at your workplace. Employees or team mates are well incentivized for their initiatives so that the customers can get a better experience.

Remember, a happy client is a healthy business. As long as you are able to distinguish between higher cost benefits vs. low return on investments, you are good to go. Remember, you don’t want to fall behind in this highly competitive race. Use your customers as your stepping stones, that way, the market would belong to you

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