Nassim Kassim is the executive director of Sweet Waters Affordable Housing Services Limited, a real estate firm which deals with construction of commercial and residential houses.
Secret to making money in construction: There are no two ways towards profits. You either stick to professionalism or incur losses. Personally, not following the bill of quantities has been my biggest mistake in this industry so far. This is the make or break document that details what my expenditure is estimated to be. If I get it wrong or gather lower prices for items than the actual ones in the market, I’ll inevitably end up with losses.
Starting a construction business: It is easy for many people getting started in real estate to under-quote their project. From my experience, I have seen that this leads a budding developer to engage the services of untrained fundis as they seek a short-cut to cover the deficit that resulted from the poor quotation. Never under-quote your project if you want to attract clients and stay at the top.
Handling money in construction: Separate bank accounts have been my trick in handling money. On one hand, I have business accounts reserved for clients and project funds. On the other hand, I have my personal accounts. I ensure that in all these accounts, every coin that goes in or out is properly accounted for at the end of the day. This enables me to easily tell an impending loss or an over-expenditure before it spreads.
Capital, Loans, Savings: In my own experience, getting a building loan is more efficient than waiting on savings. Your projects will never stall. However, you must not take a loan simply because you’ve heard of developers taking them. Every coin in a potential loan must have its value on the project.
Buying materials: This is where many aspiring developers get trapped. Never buy materials in small quantities. In fact, you must understand that buying building materials in bulk is another simple way of reducing costs and adding unto your net profits. Bear in mind too that you will not only cut on transport if you have a small project but maintain the stability of the materials in use by purchasing them in one order.
Women in Construction: There is plenty of space for more women in this sector. From engineers and architects to contractors and fundis, this is no longer a preserve of men. Get your papers and construction gear and venture out.
Instincts: Unfortunately, things can go wrong in the construction sector. It is important that you follow your instincts when signing a contract. If it smells fishy, leave it as it is probably rotten.