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Every small business hits a plateau in which they stop growing. There are a lot of factors that come up that can seriously limit growth.
Why does a small construction company need to focus on growing bigger? There is so much competition that if a company takes their foot off of the gas pedal, they can lose out. If this happens often then eventually the business will no longer be viable.
Putting a small business on a growth path is a guarantee for longevity and success for years to come. In this article, we will go over what it takes to get past the plateau and grow.
1 – Do proper forecasting
Cash flow problems are one of the biggest barriers to growth for a small construction company. Often, there are gaps in between projects. When a big expense happens at that time it can be crippling.
These periods of boom and bust are mostly avoidable when a proper financial forecast is done. Looking ahead to when projects are coming in and at what time there will be big expenses is key to financial planning.
Use construction accounting software to give an accurate picture of where the company is now, what has happened in the past and then extrapolate this data to the future. Create a budget with this information and it can help smooth out those lean periods so growth can be the focus.
2 – Generate leads
A company can’t grow if there are too many gaps in between jobs. It should be a priority of every construction company to have a robust lead generating strategy. Usually, it makes sense to hire an agency to do this since this is their specialty. Your focus should be on what your expertise is when it comes to the construction business.
It does make sense to understand the process, however. The way it works is that agencies set up a sales funnel by creating a website for your construction business with a landing page. Then, either through running online ads or using content marketing, they get people onto the landing page to sign up for an email list. This is the beginning of the funnel.
Through a series of emails and other means, the lead is moved through a process in which they come out ready for a sales call at the other end to become a new client rather than just a lead.
3 – Get government contracts
The fastest way to grow is to hook up with some government contracts for construction jobs. If you have a particular niche within which you work, then this is ideal as you are an expert in a certain sector.
Sign the company up as a government contractor at the local county, city or state building departments. Before you get involved in bidding, set up a bidding system so you are ready for the process.
Have a way to estimate a project between material and labor costs as well as how long it is projected to take. Then have a bid ready to go which still brings in a profit. It’s ok for the first bid to go slightly above break even to get future contracts.
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