Building a robust business case for your construction project

Building a robust business case for your construction project is the foundation to your future success. In this article, find out what you must include and why.

The value of building a robust business case for your construction project

Before a construction project gets off the ground, it’s imperative to get the project planning stages right from the outset for a successful outcome later.

One of the first steps in a construction project planning phase is to build the business case to justify the project – vital for garnering financial backing from investors, approval from project stakeholders such as the local community and official decision-makers, and overall support for a project right from the start.

Feasibility study

A business case will often begin with a feasibility study which is undertaken at the very early stages of a project.

A feasibility study analyses the financial, legal, and technical viability of a project, considering factors such as the likelihood of planning permission and deliverability within the budget and timescales. It will also identify opportunities and challenges relating to the project and outline any potential risks and how they might be mitigated.

Options appraisals

The feasibility study will help to inform a range of feasible options which are then assessed through options appraisals.

Options appraisals evaluate and compare the different ways of delivering the project to decide upon the most suitable final option for the project and business case.

Factors to consider during the options appraisal process include:

• Criteria to meet the project’s objectives and goals considering the needs and preferences of the project’s stakeholders.
• Benefits and challenges of different construction options, including materials, building methods, and design elements.
• Cost and value for money for different options, including timescales, quality, and longevity.  
• Feasibility analysis for each option.
• Risks associated with different options.
• Sustainability factors and environmental impact.

Budget planning

The budget is often the bottom line on whether a project gets the go-ahead, and robust budget planning is essential in a successful business case.

A robust budget plan should include cost projections and estimates for each element of the project, including initial investment, materials, labour, and overheads; cash flow forecasting; financial projections; revenue streams; projected profits; and return on investment (ROI).

A Bill of Quantities, quantifying all the materials and labour required to build a project, can support the cash flow forecasting process. 

What should a construction project business case include?

Planning a business case involves developing a comprehensive report outlining a construction project’s viability.

The business case will be used to determine whether the project proposal can progress to the next stage. It should be compelling and presented clearly and concisely with relevant and appropriate detail.

A robust construction business case should include:

• Project description detailing the objectives, benefits, proposed design, timescales, key dates, and construction project scope.
• Background information including any existing records, surveys, and site plans.
• Market research, including demand, trends, and competitors.
• Inclusion of any external expert advice that has been sought such as independent consultants or specialists.
• Details of the feasibility study, including opportunities, challenges, and risks.  
• Information and outcomes of the options appraisals, including rationale for the preferred solution.
• Budget plans and financial forecasting, including cash flow forecasting, balance sheet, and cost projections.
• Investment prospects and demonstration of the project’s value for money and return on investment (ROI).
• Details about stakeholder support for the project.
• Information about any regulations applicable to the project and a demonstration of how the project will be legally compliant.
• Procurement options.
• Proposed steps to progress to the next stage.

How Evolution5 can help

Evolution5 is a professional construction consultancy offering project management, and cost management services for projects across London and the South East.

Whether you need support in building a robust business case for your construction project, or need an external expert eye to help review your project plan, we can help.

By working with Evolution5 as a professional partner in your construction project, you benefit from the wealth of experience our consultants have in providing this role across a broad range of project types and sectors. You are allocated a dedicated resource with experience, knowledge, and background to support the specifics of your project to maximise the return on your investment and achieve a high-quality end product.

If you have a construction project and want to explore how the team can help you, click the below button or call 023 8040 5073.