This Podcast Is Episode Number 0358, And It's About Tips For Getting Your Construction Business Through Tough Times If you're a small business owner whose construction company hasn't gone through hard times, that's great, but it's likely to happen at some point. As much as we dream about being brilliant enough in this industry that we'll never face slow times, there are many things beyond our control that can negatively affect our organization. Here are six tips for getting your business through difficult periods so you can look forward to many more years of construction business ownership: 1. Take care of your employees Workdays lost to sickness are a considerable cost to the company and a threat to productivity. Regardless of health threats and virus spread, the workplace itself is a source of infection, and you can reduce the risk of causing absence in your employees by implementing control measures to ensure the environment is clean and safe.
Introduce a culture that dictates employees take responsibility for their cleanliness at work; provide hand sanitizer to encourage hand washing. If employees share desks, they need to understand the impact on their colleagues of not cleaning equipment after use. Show that the business is committed to a healthy workplace by carrying out regular deep cleaning of carpets and any areas likely to be a high infection risk.
2. Minimize stress
Any number of factors can contribute to stress in the workplace. The most common are workload, environmental conditions, and personal circumstances outside work. Managers should have regular one to one meetings with all workers and be trained to understand the symptoms of stress and early warning signs that someone may be suffering. Another way to monitor stress levels in your business is to undertake an employee survey.
It is a worthwhile investment for any business to provide support mechanisms for employees experiencing stress, even if not caused directly by the workplace. An independent employee assistance scheme can advise on a wide range of issues, such as financial matters or personal relationships. Absence due to stress can be long-term and recurring, so it is always preferable to deal with underlying causes, rather than be left dealing with the symptoms when it's too late to prevent them.
3. Focus on your existing clients
When construction companies go through tough times, many owners turn their focus to bringing in new business. The downside is that existing clients are often forgotten, but those are the most efficient people to make sales to. You don't need to stop marketing yourself to new customers, but make sure you give extra focus to the clients you already have, to ensure they remain loyal. Find out what their current needs are, how successful you are at meeting them, and what you can do to maintain an ongoing relationship. Communicate with them and always provide exceptional customer service.
4. Reach out to others
Chances are, you aren't the first person in your trade to experience tough times. Talk to other people who have been in similar situations to learn how they navigated those challenges. Ask them what did and didn't work for them, and what they learned from the experience. Some—if not all—of their answers could apply to your business, or could at least inspire a solution.
5. Examine your marketing plan
Your marketing plan brings in new clients. Now is the time to consider fresh marketing ideas to bring in new revenue. Is there an area of your construction business you haven't promoted before but could bring in clients? Is there a new way to market yourself you haven't tried?
Examine previous marketing efforts to determine how successful they were. If they weren't successful, stop wasting your valuable time and money on them. Use your efforts on something new.
6. Improve your cash flow
Analyze your construction company's financial health to see if there are ways to improve cash flow. Can you charge clients a deposit or encourage payment upfront to increase cash flow? Are there products you sell or services you provide that bring in revenue more quickly than others? Are there ways to save money that won't hurt your business in the long run?
It can be tempting to eliminate staff, but when things are good, you'll need to hire employees again. Doing so costs time and money. See if you can find small ways to save money that won't negatively affect your construction business when it starts booming. Cutting over time, for example, can save you money without losing staff.
Make sure you can account for every dollar your business spends. Don't hide from creditors, communicate with them to find out if you can restructure your debt or extend your terms. Free up as much money as you can without setting yourself up for failure when things turn around.
Final thoughts
Chances are your construction business will go through tough times at least once. It's crucial you take action to help get you through it, rather than crossing your fingers and hoping the difficulties pass. Look after your employees and they will look after you. The steps you take during these challenging periods will help you, but they can also help set you up for increased success in later years.
About The Author:
Sharie DeHart, QPA is the co-founder of Business Consulting And Accounting in Lynnwood, Washington. She is the leading expert in managing outsourced construction bookkeeping and accounting services companies and cash management accounting for small construction companies across the USA. She encourages Contractors and Construction Company Owners to stay current on their tax obligations and offers insights on how to manage the remaining cash flow to operate and grow their construction company sales and profits so they can put more money in the bank. Call 1-800-361-1770 or sharie@fasteasyaccounting.com
