When you’re running a construction business, there are two main areas you could go into. You’ll either be doing small scale work on residential properties or larger jobs on commercial properties. If you’re making good money doing smaller jobs but you want to expand and land some of those bigger contracts, you’ll face a lot of challenges. To make that transition easier for you, we’ve outlined some of those hurdles and given some advice on how to overcome them.
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Funding
The first thing you’ve got to work out is how you’re going to pay for all of the materials and extra employees you’ll need to complete those bigger jobs. When you’re trying to meet those funding challenges, you’ve got a couple of options; hopefully, you’ve been bringing in a good amount of money doing those smaller jobs and if you’ve managed to save a good amount, that will cover a large chunk of the costs. However, you aren’t likely to have enough stashed away to build an office building, for example. You’re probably going to have to take out a loan to pay for the rest of the materials and cover the cost of the staff you’ll need to take on. There is a certain amount of risk involved there so you should only do it if you’re sure that you can complete the job and get paid in time to repay the loan, otherwise, you’ll end up in a sticky financial situation. Once you’ve finished a couple of larger jobs, you should have enough income to fund future jobs without borrowing.
Moving Materials on Site
When you’re working on a residential home, the site is fairly small and moving materials around isn’t too much of a problem. But when you’re building on a much larger scale you’ll have more materials to shift over much larger distances. You can use technology used to adapt rotary motion into a linear format to build a rail system capable of carrying heavy loads around the site. This will make it a lot easier to move materials around so you don’t need to spend time making multiple trips around the site.
More Competition
Smaller building firms tend to do most of their work in the local area and get jobs through word of mouth. Once you’ve done a few jobs to get the ball rolling, recommendations will get you enough work to get by. You’ll still have to deal with competition, of course, but you shouldn’t struggle to get enough jobs to make a good living. When you’re looking for larger jobs, it’s a different game. There are lots of already established companies that win most of those contracts and you’ll be competing with them. They have the power of brand recognition behind them but you can still get work if you’re clever about it. The bad news is, you’ll probably have to lower your prices for a while to get your foot in the door. After you’ve done a few jobs, you’ll start to build some brand recognition for yourself and you’ll have the power of personal recommendations behind you.
Making that transition to the big time is going to be difficult but if you follow this advice, you can overcome those hurdles.