industry has always been cyclical, Schleifer points out, and right now, construction businesses cannot afford to become financially weak. You must maintain your financial viability to avoid losses and obtain outside financing necessary to grow and build new projects.
Schleifer advises companies to continually measure their staying power—constantly test what you are doing to make sure it will sustain the business long term. Pick one or two measures to regularly review, such as working capital, your balance sheet and net worth.
Stone recommends seeking outside help from experts who have construction-specific experience. “Construction has nuances that no other business has,” he says. You also have to be willing to take advice.
Shapiro believes every business should have a coach. “People who are the best at what they do are people who use help in smart ways.”
Management Tips
“Management always begins with self-management,” Shapiro says. He recommends that you take time now to get organized—create a calendar and to-do lists, avoid clutter, clean your email, create a filing system, return calls and be able to find anything in your office in less than 10 minutes. Only then can you focus on how to manage your business, properly delegate and put systems into place.
Stone says employee problems can often be traced back to the owner. He believes construction business owners tend to hire quickly, and they take months before letting someone go.
“Most contractors are great people and try to treat employees as well as they possibly can,” Stone says. This is a great attribute, but always hold your employees accountable.
Advice From Other Contractors
Take time to talk to others who have experienced success in the business to learn from their successes and failures. Schleifer provides this perspective: “It’s fascinating that in the construction business, the various trades think of themselves as very different, and the only place they’re different is in the field.”
Other contractors in the industry shared what they have learned with CBO in our active LinkedIn group. Keep their advice in mind to start the year off right:
Jack Whealan, managing partner with Sky Top Builders, LLC, says: “Project your volume and velocity and your numbers—make a plan, know the plan, and stick to it with dogged determination.”
Frank Lott, director of construction at PreciseCM, a commercial general contractor, says: “I follow three rules: (1) Out of debt, out of danger. (2) Mitigate, don’t litigate. (3) Don’t work with anyone you don’t like.”
Danny Gunsallus, the owner of Power House Plastering, says: “Know your costs, keep your overhead low, and always service your customers.”
Michael Regina, owner of Big Sky Enterprises, LLC, a commercial contracting firm, says: “Determine your USP (Unique Selling Proposition). What is going to make you stand out above the rest?” He adds, “Your time is your greatest asset and can become your greatest liability if you’re not a good steward of it. Control your schedule; don’t let your schedule control you.”
