10 Steps To Building A Successful Construction Company In This New Economy
For the last five years or so many construction business owners were operating their businesses in survival mode. Now, with the economy improving and residential construction activity picking up, many contractors will be looking to grow their businesses again. If you are looking to grow your business here is my list of 10 steps contractors should take to make the switch from surviving to thriving.
- Build your team. You can't do it all; no matter how much you try. Find the right people with the right attitudes, skills and personalities to be part of your team.
- Be ready to take advantage of opportunities for growth. Hire and properly train employees before you already need them and their required skills up and running.
- You are not the Energizer bunny! Make sure you have a plan for recharging your batteries and keeping up the motivation you will need to make your dream business happen.
- Be the leader you need to be. Work on your leadership skills and make sure you understand the difference between leadership and management, and when to use one versus the other. Good employees want to be lead, not supervised.
- Be careful about and watch your overhead expenses. Many construction businesses failed during the recession because they could not cover the cost of the overhead they were committed to when volume and or gross profits dropped.
- No Wild Ass Guesses (WAG)! Know the costs of doing more business before you do more business so you can use the right markup to price your jobs profitably.
- Dip your toe in the water before you dive in. Before you actually increase your overhead costs test the marketplace you plan to work in to make sure you can sell at the increased pricing you'll need and can sell enough work at that price. Consider if you are in the right market to do business but also if you have the right marketing and sales skills in place.
- Don't be blind-sighted by increased job costs. If you like the idea of an extended backlog of work find a way to protect your planned profits from escalating costs. Labor and many material costs are expected to go up dramatically before the end of the year. Be sure to price your work for the actual costs you will incur at the time you produce it.
- Know your limits. Do what you can yourself but get the professional help you need to do things right; to avoid costly mistakes, increase the likelihood of success and maximize the results for your all your efforts.
- Think things through first and create a written plan to guide you. Successfully growing your remodeling business or construction business takes much more than just selling more work and adding employees. Without a plan to commit to, business success might only be a short lived dream for you and your employees.
Increase the likelihood of your success
Be sure to build accountability into your business and your leadership. Share your plan and your measurables with someone who can and you will allow to hold you accountable to following your plan and achieving your goals. This could be a spouse, relative, business coach or a mentor. Make them part of your team and give them permission to be brutally honest with you when needed.
You can't do it all; no matter how much you try.