Taxpayers are forking out more than £200 million a year to repair street surfaces which are poorly relaid by utility companies' contractors after roadworks, according to research.
The Local Government Association (LGA) said councils in England and Wales have to redo some 340,000 shoddy resurfacing jobs a year - 17% of all private companies' roadworks - at a total cost of £218 million to the taxpayer.
And a survey of small businesses found that poorly planned and executed roadworks are costing shops thousands of pounds a week and stunting local growth, said the LGA.
The association is presenting its evidence to a summit of highways managers, business leaders and utility company bosses in the hope of reducing the burden of roadworks on councils, shops and motorists.
The meeting will discuss proposals for a deposit scheme which councils could draw on to fund repairs to poorly resurfaced roads; an inspection and future repair charge paid by utility companies to support the cost of identifying and dealing with problems; and an online star rating system to help utility companies identify reliable contractors.
The LGA's survey of hundreds of high street businesses, carried out last month in conjunction with the Association of Convenience Stores (ACS), found that 57% have had streetworks nearby over the past three years and 72% of these were "negatively affected" - including by delivery delays, reduced sales and even forced closure.
Some 43% of those affected experienced disruption for at least a month and 9% for more than six months, while 31% said that roadworks had cut their footfall by a quarter or more, losing as much as £7,500 a week as a result.
Some 96% said councils should have the power to ensure roads are returned to proper standards after being dug up and 79% said utility companies should help pay for it.
The chair of the LGA's economy and transport board, Peter Box, said: "Thousands of hours of streetworks disruption - closed roads, blocked pavements, temporary traffic lights, noisy drilling, restricted parking - are totally avoidable if only utility companies did the job properly.
"There's no excuse for shoddy resurfacing and it's unforgivable when it puts at risk the future of local shops, many of which are the product of years or even generations of hard work. The whole sector needs to sit down together and discuss how we can work together and make sure we keep streetworks disruption to an absolute minimum."