One of the greatest perks of owning your construction business is the freedom to make the decisions in your own time and in your own way. And, one of the challenges of owning your own construction business is found in observing the outcome of those decisions. In this article, we’ll list some vital building blocks to bolster your construction company, while prompting the best outcomes.
Define Your Mission and Objectives
This does not need to be more than two or three sentences, but your mission for your business should be clear: why you are in the construction business and your objectives for succeeding in it.
Create a Construction Business Plan
One of the most important elements of your construction business will be found in a business plan you’ve created. If you do not yet have a plan, use this construction business plan as a comprehensive guide. Inside this plan, you’ll include your mission and objectives, an assessment of your target market and your competitors, an operations plan, financial projections, and the marketing strategies for your construction business.
When completed, this plan will be suitable to present to lenders, investors, banks or other financial institutions for funding purposes. Refer to your business plan regularly to make changes and refresh your strategies as your business grows.
Assess the Target Market
This is an excellent time to examine your target market; who will contract with your company for construction projects? Are you seeking commercial projects or residential homes? Is your company positioned for large tracts of homes or single, custom homes? Answering these questions will help position your company to bid on the target market most suited to your business capabilities.
It is always vital to know of one’s competitors in the construction business. Determine, if possible, the pricing models of your competitors and examine any special services or unique offerings of your competitors. You will want to create a niche, or unique offering, for your company in order to overcome your competitors and it is more advantageous to increase your offerings rather than driving prices to the bottom in a bid to undercut competitors.
Set Up Financial Projections
Every professional-looking business plan contains sufficient financial projections which include both expected income sources, such as sales revenue and expenses associated with launching or operating the business. This will help potential investors understand the financial needs and potential of your construction business. When calculating your financial projections, consider the cost of marketing, business development, and other necessary investments.
Create an Attractive Marketing Strategy
After considering what your competitors may offer, plan a marketing strategy that will attract new clients and position the unique value of your company in an attractive way. For example, if you are tackling commercial construction contracts, you’ll want to join the organizations that represent commercial building owners. You may want to exhibit your company at trade shows or other event venues that provide services to commercial building owners. These associations can prove to be advantageous in building relationships.
If your construction company is building custom homes, your marketing strategy will be directed to consumers. Personal referrals via word-of-mouth are especially helpful in the custom home-building sector, as are potential customer sneak-previews of unfinished homes during the construction process. The best avenues for contact will be via ads on social media such as Facebook, or via website representation. Advertise construction services using regional ads in newspapers or billboards, as well. Offering virtual reality experiences for custom homes is also advantageous for consumers who would like a 3D presentation of what their homes will look like when completed.
Prepare an Operational Plan
In a construction business, it is absolutely vital that each person understands the role and responsibility within the position held. In addition to the craftsmanship skills that construction teams must hold, communication must be effective and leadership will need to be adept in conflict negotiation, consensus-building and other forms of team management.
Building a construction business depends as much on the leadership and creativity of the executive staff members as it does on the knowledge and experience of each crew member. A construction business with a solid business plan will benefit from putting into place and practice the vital building blocks to a successful and long-term growth pattern.