It’s the oldest trap in construction procurement. You have a budget. You need 500 meters of boundary wall.
- Supplier A quotes AED 150,000. Delivery in 14 days.
- Supplier B quotes AED 165,000. Delivery tomorrow.
The Procurement Officer picks Supplier A. “I saved the project AED 15,000,” they say. They didn’t. They likely cost the project AED 50,000.
The “Burn Rate” Calculation
Every construction site has a daily “Burn Rate”—the fixed cost of just existing.
- Site Staff Salaries (PM, Engineers, Security): AED 3,000/day
- Equipment Rental (Generators, Cranes, Porta-cabins): AED 2,000/day
- Labor (Standing idle): AED 5,000/day
Total Burn Rate: AED 10,000 per day.
The 14-Day Delay
Supplier A is cheaper, but they are “Made to Order.” You wait 14 days for the first delivery. During those 14 days, your site is open, but the wall isn’t built. You can’t secure the site. You can’t start the excavation inside. 14 days x AED 10,000 = AED 140,000 in wasted overheads.
The Real Cost
- Supplier A Real Cost: AED 150,000 (Product) + AED 140,000 (Delay) = AED 290,000.
- Supplier B (Precision Precast) Real Cost: AED 165,000 (Product) + AED 0 (Delay) = AED 165,000.
Supplier B—the “expensive” one—was actually AED 125,000 cheaper.
Buy Time, Not Concrete
At Precision Precast, we price our products based on the value of Immediate Mobilization. We are not the cheapest per cubic meter. But we are the cheapest per project, because we get you off the site faster.
Don’t let a AED 5 saving cost you a AED 5,000 day.
