Managing progress claims effectively is essential for smooth construction projects and financial clarity. When handled efficiently, progress claims facilitate timely payments, which help maintain cash flow and keep the project on schedule.

In this article, we break down what progress claims are, why they matter, and how you can handle them efficiently. This article will help you understand the basics and provide practical tips for managing claims to keep your projects on track and avoid common issues.

What is a Progress Claim?

A progress claim is a formal request for payment submitted by a contractor to a client for work completed during a specific period on a construction project.

It represents the portion of the total contract value that the contractor believes they have earned based on the progress made.

What is Inside a Progress Claim?

A typical progress claim includes:

• Project details (name, date)
• Contractor’s information
• Client’s information
• Claim period
• Payment claim number
• Summary of work completed
• Breakdown of costs
• Previous claims and payments
• Total amount due
• Current claim amount
• Supporting documentation
• Contractor’s signature

What Documentation to Include in My Progress Claim?

Include documents that support your claim, such as:

• Detailed breakdown of work completed
• Progress report
• Photographs as proof of work
• Material delivery receipts
• Timesheets or labour records
• Any relevant change orders or variations
• Updated project schedule
• Quality assurance reports

Best Practices in Progress Claims

Here are some best practices for managing progress claims in construction:

• Detailed Documentation: Ensure all progress claims are supported by comprehensive and accurate documentation, including work completed, materials used, and any variations.
• Regular Submissions: Submit progress claims at regular intervals as specified in the contract to maintain cash flow and minimise disputes.
• Clear Contract Terms: Understand and adhere to the specific terms and conditions outlined in the contract, including deadlines, milestones, and payment schedules.
• Accurate Reporting: Provide precise and up-to-date reports of work progress to justify claims, including any changes or deviations from the original plan.
• Timely Notification: Notify all relevant parties promptly of any issues or changes that could affect the progress claim, such as delays or additional costs.
• Collaborative Review: Engage in regular reviews and discussions with stakeholders to resolve potential issues and ensure agreement on the status of the work.
• Dispute Resolution Mechanism: Include and utilise a clear dispute resolution process to address any disagreements related to progress claims effectively.
• Record Keeping: Maintain organised and easily accessible records of all progress claims, communications, and related documents for future reference and audits.
• Legal and Contractual Compliance: Stay informed about legal requirements and ensure compliance with contractual obligations to avoid potential legal complications.
• Professional Advice: Seek advice from legal or financial experts when dealing with complex claims to ensure accurate and fair submissions.

We’ll illustrate and dive deeper into these best practices in the following sections on the drawbacks of progress claims, and how to improve your processes.

The Drawbacks of Progress Claims

Here are several common challenges construction companies face in progress claims:

Time Consuming

Progress claims can be significantly time-consuming for construction professionals. Preparing a comprehensive claim requires gathering extensive data from various sources on the construction site, including material usage, labour hours, and subcontractor progress.

This process often involves coordinating with multiple team members and departments to ensure all aspects of the project are accurately represented.

Moreover, the time spent on creating, reviewing, and submitting progress claims can detract from other critical project management tasks, potentially impacting overall project efficiency.

Unavoidable Disputes

Despite best efforts, progress claims frequently lead to disputes between contractors and clients.

Disagreements can arise over the interpretation of completed work, the quality of workmanship, or the validity of certain charges.

These disputes can strain relationships, delay payments, and in severe cases, lead to legal proceedings.

The subjective nature of assessing construction progress, especially in complex projects, means that different parties may have varying views on the percentage of work completed, leading to contentious negotiations and potential project delays.

Administrative Burden (Detailed Documentation)

The requirement for detailed documentation in progress claims places a significant administrative burden on construction teams.

Every aspect of the claim must be meticulously documented with supporting evidence such as photographs, material receipts, timesheets, and quality assurance reports.

This level of detail, while necessary for transparency and accuracy, demands considerable time and resources to compile, organise, and present effectively.

The need for such extensive record-keeping can be particularly challenging for smaller construction firms with limited administrative staff, potentially diverting resources from core construction activities.

How Can I Improve My Progress Claims Process?

After we’ve reviewed the challenges, let’s take a look at how we can improve this process:

Establish an Efficient Billing Process

To enhance your progress claims process, it is crucial to establish an efficient billing process.

This involves creating a streamlined system that ensures timely and accurate invoicing, minimises errors, and integrates seamlessly with your financial management tools.

Implementing standardised procedures for generating, reviewing, and approving claims can significantly reduce delays and discrepancies, while regular training for staff involved in billing can help maintain consistency and accuracy.

Additionally, leveraging technology such as automated invoicing systems can further improve efficiency and ensure that all billing information is tracked and managed effectively.

Review Contract & Document Everything

Reviewing contracts thoroughly and documenting everything are key steps in managing progress claims.

A comprehensive review of contract terms and conditions helps in understanding the specific requirements and obligations related to claims.

Documenting all interactions, changes, and approvals associated with the progress claims process ensures transparency and provides a clear audit trail, which can be invaluable in resolving disputes or clarifying issues.

This detail-oriented approach not only protects your interests but also facilitates smoother and more predictable claims processing.

Digitalise Your Procurement Processes

Digitising your procurement processes is another important strategy for improving the progress claims process. By transitioning to digital systems, you can automate various procurement functions, such as purchase orders, approvals, and tracking of goods and services.

This digital transformation helps in reducing paperwork, minimising human error, and enhancing the speed and accuracy of procurement activities.

Moreover, digital tools often come with advanced analytics that can provide insights into procurement performance, identify inefficiencies, and support data-driven decision-making, ultimately contributing to a more streamlined and effective claims process.

One such digital solution is Doxa Connex, a collaborative trade platform that provides an end-to-end solution for procurement, payment, and financing. Read more about our solution in the next section!

Related Articles:

• The 6 Best Construction Procurement Software in 2024
• Why ERP Alone Isn’t Enough For Construction Payment Management

How Doxa Simplifies The Progress Claim Process

Progress Claim With Doxa Connex

As we discussed earlier, a traditional monthly progressive claim involves manually passing printed hardcopy documents (e.g., PDF, Excel) from one party to another.

This high quantity of documents leads to inefficiencies such as misplaced documents and manual data entry, resulting in a tedious claim process.

We at Doxa identified the need for a market solution to help companies streamline progressive claims.

With this in mind, we developed Doxa Connex, a common digital workspace for all parties to collaborate.

To increase accountability for every project, no party is allowed to edit their counter-party’s input.

We made this possible with our blockchain technology and clear audit trail.

Here are the primary solutions Doxa Connex offers:

Cost Reduction: Our clients have experienced an up to 49.2% reduction in manual hours spent on workflow.

Doxa Connex helps you automate processes (e.g., payments from main contractors to suppliers), reducing manual work, increasing accuracy, and letting you focus on what matters.

One System For All Your Process: Doxa Connex is an end-to-end system that manages documentation such as

Request for Quotes, Purchase Requests, Purchase Orders, Invoices, and Payment Tracking. We remove the need for paper-based documents and endless back-and-forths.

A Single Source of Information With a Cloud Platform: Doxa Connex acts as a single source of truth for all your projects, providing easy access to all your data and simplifying collaboration between stakeholders.

Our dedicated mobile app further enhances on-site productivity.

Specially for the Built Environment: Doxa Connex is designed for contractors, sub-contractors, and suppliers in the Singapore built environment.

We are modelled towards the Building and Construction Authority’s (BCA) recommendations.

Make Your Progress Claims Efficient With Doxa Connex

In conclusion, managing progress claims effectively is vital for maintaining financial control and ensuring timely project delivery in construction.

Clear documentation, regular communication, and adherence to contractual terms help mitigate disputes and foster smoother project execution.

Enter Doxa Connex – a premier platform connecting buyers, suppliers, and financiers effortlessly.

Built on a strong enterprise-grade foundation, our highly flexible platform allows us to constantly add, improve and enhance features and workflows, especially for the construction industry.

To provide the best value for buyers, we’ve partnered with leading financial institutions including Maybank, UOB, OCBC, and more.

Our platform is trusted by prominent players in the construction industry such as Tiong Seng Group, Kimly Construction, and Sim Lian, creating a thriving ecosystem for growth.

Interested to see how Doxa Connex streamlines progressive claims?