If you’re starting a construction business and thinking of scaling up, you may feel overwhelmed with the list of options that are made available to you. Proper planning and preparations are needed to make sure that your business is not just successful but stands out from the rest of the competition.
The construction market is booming right now after the 2008 crash and things are looking lucrative. Now is the time to hop on to the bandwagon of opportunities. Here is a step-by-step guide on how to scale up your construction business below.
1. Define Your Target Niche
Do you want to be known as just a general-purpose construction business or the best construction company that specializes in making hotel renovations and installing LED-certified fixtures? Defining your target niche is a must if you’re serious about making your business look professional. Clients have specific needs and by specifying what your business is good at, you’ll have a higher chance at landing profitable and long-term projects.
2. Create Your Business Roadmap
Your business roadmap for your construction company will consist of setting milestones and working towards achieving them. Think about the vision of your company and ask yourself where do you see your brand 5 years from now. Set short-term and long-term goals because they will keep you accountable.
3. Explore Funding Options
You can apply to banks, VCs, and angel investors to invest in your company for short-term or long-term funding. You can take small loans and pay them back as your business scales up. Funding will be needed because when you’re scaling up, you will need to buy new equipment and update existing technologies.
There could be machinery breakdowns or problems arising in your supply-chain level that need to be remedied quickly in order to continue business operations. Getting adequate funding makes sure you can meet these emergency situations whenever they crop up. When it comes to buying equipment, you don’t need to buy everything firsthand. Look into renting or leasing construction equipment to cut down costs and use your capital wisely. Other options you can explore for getting enough funding is applying for pool financing, sub-contracting jobs, and chipping in money from your previous business profits.
4. Draft A Company Vision And Statement
You’ll have to remind your employees and clients from time to time why you do what you do. What sort of difference is your business trying to make and how is it helping?
A company vision and statement helps clearly define your business goals. It represents your mission, philosophy, and values you believe in. You can explain what you are working towards in your vision statement and what your company hopes to turn into in the future.
5. Hire Extra Help
If you’re feeling short-handed certain weeks of the day, you can look into hiring temporary laborers. There are different kinds of labor assistance available: full time in-house, sub-contractions, and laborers who engage in independent contracts. Find what works for you and hire the right pool of talent for the job. You’re going to need it when you’re busy scaling up.
6. Apply For Permits And Insurance
The last thing you want is to lose all your capital due to accidental fires or destroy your equipment. Insurance will keep your business shielded from unforeseen circumstances and events involving natural disasters.
You will require surety bonds to run your construction business legally and construction companies have different types of insurance policies available to them. You can get vehicle insurance, equipment insurance, and even insurance for your property and workers’ compensation! Additionally, make sure these policies comply with your building codes.
To start a construction company and scale it up, you will have to get a construction license along with safety permits for your employees. Tradesmen permits and general business licenses also fall under construction business licenses. If you offer roofing financing to clients or exclusive business services, you may include it in your statement briefly.
7. Invest In Safety Gear And Technology
Accidents are inevitable and a part of the job. However, you can reduce incidents of such hazards. You can invest in high-quality equipment and buy safety gear and stock up on basic building materials like bricks, steel, inventory supplies, power tools, timber, and other basic necessities.
Construction business technology is another area you’ll want to look into. Your operations are likely going to expand so you want to review your operational strategies while you’re at it.
There are various SaaS and cloud computing solutions for efficient data management, billing & invoicing, and service maintenance. You’re going to have to pay extra for housing additional servers but that’s fine since you’re scaling up.
8. Focus On Networking
Don’t neglect networking when scaling up your company. Be involved with the industry and give back to the community by sharing your expertise. Networking with other professionals and industry experts will open new doors for your business.
One of the best ways to get networking is to join a trade association and be active there. You can also promote your business online by creating a website and make social media pages. Build a digital presence because clients prefer to get a preview of what you do before they decide to invest in projects. You can also showcase your construction portfolio on your website which is a plus.
Also, collect user reviews and client testimonials when you’re done with construction projects. These will prove to be very useful when someone asks for references. You can put them up on your blog and website too. Make sure they’re optimized and get a professional web developer to help you set them up. In the 20th century, running a brick and mortar business is hard without an online presence.
Scaling up your construction company is no cakewalk but if you plan ahead and apply a bit of foresight, you’ll find that it becomes more manageable. Make sure to take your time and invest in the required resources to get started.
If you take loans, you can always pay them back steadily as your business continues to scale up. Don’t go in with an all-or-nothing attitude because business requirements can change and you’ll find yourself having to adapt to the industry’s growing needs. Hopefully, these basics will have you covered for now.