Your fab clock starts when the fitters finish
You can't field measure covers until the mechanical contractor has set and tested pipe, so a six to ten week shop clock starts on a date somebody else picks.
Most trades buy off an approved submittal and stage material before the work starts. Your fabricated scope can't be ordered off a drawing at all, because the shop needs as-built dimensions of work that isn't in place yet, so your lead time stacks on top of another contractor's completion date. That makes you the sub whose procurement clock can only start after somebody else finishes, and the float it eats is yours.
The size of it
Keep a four-man crew and a rig through a three-week dead window on a $180K mechanical insulation scope and you're roughly $30K to $40K into unabsorbed labor and truck cost with nothing to bill against. Then you work the compressed remainder at overtime.
The fabricated part of your scope gets cut to numbers that don't exist until another trade is done. Removable blankets and pads, PVC and metal fitting covers, and jacketing are all made to field-measured dimensions, which means the measuring can't start until the mechanical contractor has set the pipe and passed the pressure test. From that date you're looking at six to ten weeks of shop time, and the GC set the finish date before any of that was known. The envelope side works the same way for a different reason: brand-specified rigid continuous insulation is written no-substitution, so one plant's production queue controls when window install and cladding get to start.
Three moves, in order
Step 06: Project management
Billing dates, change orders, and notices, written as standards that work without anyone chasing them.
What else costs insulation contractors money
The same mechanism in other trades
What insulation owners ask
Insulation crew waiting on mechanical to finish pipe?
You can't field measure covers until the mechanical contractor has set and tested pipe, so a six to ten week shop clock starts on a date somebody else picks.
What does it cost?
Keep a four-man crew and a rig through a three-week dead window on a $180K mechanical insulation scope and you're roughly $30K to $40K into unabsorbed labor and truck cost with nothing to bill against. Then you work the compressed remainder at overtime.
What do I do first?
Add a field measure release milestone to the schedule tied to mechanical pressure test sign-off, and get the superintendent to date it at the pre-con.
What are insulation contractors supposed to be making?
Insulation runs 22% gross margin, 14% overhead and 8% net profit before taxes at $1M–$5M. The all-trade average is 7%, so this trade is 1 point above it. The CFOS target is 11.5%.
Which part of the system fixes it?
The step is number 06, project management. Billing dates, change orders, and notices, written as standards that work without anyone chasing them. It comes from chapter 6 of CONTROL: The Construction Financial Operating System.
Everything on this page is something you can install yourself, andCONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for insulation contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.
Wrote CONTROL, the 8 step system behind these figures. More about the author.