12 Min.
What Every Contractor Needs To Know About Successful Construction Companies Contractor Success Map with Randal DeHart | Contractor Bookkeeping And Accounting Services
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- Marketing
This Podcast Is Episode 574, And It's About What Every Contractor Needs To Know About Successful Construction Companies
Small construction businesses have several characteristics that distinguish them from larger firms. These characteristics include having a limited workforce, smaller revenue streams, and a more localized focus.
They are often run by the owners themselves or a small team of employees. They tend to have a more personal approach to their work, as they are usually more involved in every aspect of the project. Due to their size, they are often more flexible and able to adapt to market or project scope changes. However, they may also face challenges such as limited resource access, difficulty securing financing, and increased competition from larger firms.
Over the years, we have had many successful construction clients. The seasoned ones have become lifelong friends and are now retired, living according to their terms. And several are still working according to their schedule with quality, high-paying clients.
Is it still possible to succeed in this industry, given the state of the economy? Regardless of government or environment, what I find common among them are these characteristics:
1. Owners leading by example
The construction company owner or project manager leads by example. They are usually the first to arrive and the last to leave. The owner knows everyone by name, and their presence is unmistakable. They show a strong commitment, setting the standard where they work. This commitment should be easy to understand. After all, if they don't work hard in their own company, how can they expect anyone else to take their business seriously?
2. Simple business structure
They operate a simple and open business structure, encouraging easy access to the owner for every employee. They value the contribution of each employee, many of whom are allowed to influence aspects of the construction business that would ordinarily be denied to them in a large hierarchical company
3. Communication among employees
Staff receive information as soon as the owner does. Goals, problems, and concerns are discussed openly. Feedback on issues is encouraged, and staff are asked to contribute their ideas for improving and overcoming difficulties. It is often this aspect of open communication that staff appreciate the most; it is unique to small construction businesses, whether you have only one or two staff.
4. The crew is carefully chosen
Staff is recruited very carefully because the contractor owner(s) recognize that they are the lifeblood of any small business. Staff are hired because their knowledge, skills, and abilities will benefit the organization rather than because of friendships or family relations. They are carefully chosen, nurtured, and trained to help the crew members and the organization from the relationship.
5. Staff commitment and loyalty
All staff are very committed and loyal. Good performance is rewarded with praise, extra responsibility, and money—poor performance is not. Poor workers are consistently removed as they upset the rest of the team. Organizations whose staff show optimum commitment and loyalty have a source of competitive advantage that is hard to copy or beat.
6. A unique service (or product delivery that goes with the service)
Most successful construction businesses have unique products or services, such as designs, products, systems, or some other aspect that sets them apart. This uniqueness is an essential source of competitive advantage and one that many companies work hard to sustain, adapting and innovating their products or services as their competition catches up with them.
7. A specific customer focus
Successful small businesses specifically focus on their customers and clients and are geared to supplying them with exactly what they want. This focus means adopting a market-led approach, with the owners and their managers consistently looking for ways to solve their
This Podcast Is Episode 574, And It's About What Every Contractor Needs To Know About Successful Construction Companies
Small construction businesses have several characteristics that distinguish them from larger firms. These characteristics include having a limited workforce, smaller revenue streams, and a more localized focus.
They are often run by the owners themselves or a small team of employees. They tend to have a more personal approach to their work, as they are usually more involved in every aspect of the project. Due to their size, they are often more flexible and able to adapt to market or project scope changes. However, they may also face challenges such as limited resource access, difficulty securing financing, and increased competition from larger firms.
Over the years, we have had many successful construction clients. The seasoned ones have become lifelong friends and are now retired, living according to their terms. And several are still working according to their schedule with quality, high-paying clients.
Is it still possible to succeed in this industry, given the state of the economy? Regardless of government or environment, what I find common among them are these characteristics:
1. Owners leading by example
The construction company owner or project manager leads by example. They are usually the first to arrive and the last to leave. The owner knows everyone by name, and their presence is unmistakable. They show a strong commitment, setting the standard where they work. This commitment should be easy to understand. After all, if they don't work hard in their own company, how can they expect anyone else to take their business seriously?
2. Simple business structure
They operate a simple and open business structure, encouraging easy access to the owner for every employee. They value the contribution of each employee, many of whom are allowed to influence aspects of the construction business that would ordinarily be denied to them in a large hierarchical company
3. Communication among employees
Staff receive information as soon as the owner does. Goals, problems, and concerns are discussed openly. Feedback on issues is encouraged, and staff are asked to contribute their ideas for improving and overcoming difficulties. It is often this aspect of open communication that staff appreciate the most; it is unique to small construction businesses, whether you have only one or two staff.
4. The crew is carefully chosen
Staff is recruited very carefully because the contractor owner(s) recognize that they are the lifeblood of any small business. Staff are hired because their knowledge, skills, and abilities will benefit the organization rather than because of friendships or family relations. They are carefully chosen, nurtured, and trained to help the crew members and the organization from the relationship.
5. Staff commitment and loyalty
All staff are very committed and loyal. Good performance is rewarded with praise, extra responsibility, and money—poor performance is not. Poor workers are consistently removed as they upset the rest of the team. Organizations whose staff show optimum commitment and loyalty have a source of competitive advantage that is hard to copy or beat.
6. A unique service (or product delivery that goes with the service)
Most successful construction businesses have unique products or services, such as designs, products, systems, or some other aspect that sets them apart. This uniqueness is an essential source of competitive advantage and one that many companies work hard to sustain, adapting and innovating their products or services as their competition catches up with them.
7. A specific customer focus
Successful small businesses specifically focus on their customers and clients and are geared to supplying them with exactly what they want. This focus means adopting a market-led approach, with the owners and their managers consistently looking for ways to solve their
12 Min.