WHAT’S YOUR CONSTRUCTION FIRM’S BUSINESS PLAN AND WHAT NEEDS FIXING IN 2022?
Do you have a business plan for your construction firm going into 2022?
Or were you going to play it by ear… again?
If you’ve been slogging away for the past year with insufficient rewards for your efforts, read on. Feel under-valued and over-worked? Keep reading. If you just can’t find the jobs that would make you happier (and more money) then lock your eyes on this article. Same old, same old, isn’t an option. If the last couple of years has taught us anything, it’s that everyone needs a Plan A, a Plan B and maybe even a Plan C… Here’s to a really great 2022.
Go Digital: The HBXL campaign to help all building firms digitally manage their business >>
PLAN A – ONLY ACCEPT HIGH QUALITY PROJECTS
Turn down those fiddly jobs that won’t buy you a takeaway, let alone pay your crew. Stop with the recommendations that might have been profitable ten years ago but are now ten times as costly. Don’t take on work just to keep everyone busy. It could be more cost-effective to have NO work on.
It’s not easy. Turning down work goes against the grain, but every day, every week, every month must count. You have just 12 months to do well. And every month you waste is a missed opportunity. You can’t look back at the end of the year and say the XYZ job cost us dearly.
Stop and look at the jobs that have actually been serious money earners over the years and focus on more of the same. A live dashboard which monitors all your jobs, like the one in EstimatorXpress, our award-winning estimating software, would be really handy for this. Or if you’ve not been in that position before – look up. Make good quality, financially rewarding jobs your goal for 2022/23.
You may have to change your profile, revisit your website or Facebook page, and crucially, review the quality of your quote presentation. A single A4 quote won’t win you the work. Clients who understand what a decent job costs want detail. They reward quality, from the quotation up. Prove, as the FMB put it, that you’re not a cowboy.
Better still, estimate as many jobs as possible, and only submit quotes for the ones that will return you a proper profit. To do that you’d really need user-friendly estimating software, one with fast calculators that will spit out quotes in hours. EstimatorXpress lops days and days off admin time. You could plan a great future for your construction business with that many days saved. Go Digital and everything will look up.
PLAN B – PRICE YOUR JOBS ACCURATELY
Well this applies whether you’re doing a 4m x 4m single storey extension or a two-storey wraparound with a loft conversion thrown in. But if you’re having to look after the pennies because the quality jobs aren’t materialising, then this plan is particularly crucial.
Don’t guess at the material costs. Prices are all over the place. Price accurately and price everything – tubes of mastic, nails, the lot. And use a clever bit of software like EstimatorXpress that tracks prices for you…
Allow for wastage – every bent nail, every lost spade, every broken brick. It’s just a percentage at the end of the estimate. Our software will apply it for you.
Factor in your overheads. If you don’t spread your 12 months of overheads across all your jobs then you’ll be paying for them out of your profit. It’s your customers who pay for your vans, tools, insurance and so on; you wouldn’t be able to provide them with such a professional service otherwise. Again it’s a stage in the EstimatorXpress process.
Inflation. Quote today’s prices and do the job in six month’s time and we’d pretty much guarantee you will have reduced your profit margin (unless you have an understanding customer). Again if you have our estimating software (that does the complicated inflation calculations for you), you can easily give them two quotes – today’s and the worse case scenario in X month’s time when you actually break ground. It will start a dialogue with the customer at the very least.
PLAN C – PROTECT THE PROFIT IN EVERY JOB YOU DO
Desperation stakes now. If you’re not getting the high quality jobs, if you’re not pricing properly, then managing your projects efficiently, is the very least you can do. Your profit doesn’t materialise at the point you win the job. Your profit comes from how you lead the project and how effectively you complete it. You must protect the figure you quoted, at all costs.
Material lists. They need to be in the hands of the Builders Merchant pronto. Today, those who are the most organised get the materials soonest. And delays cost. EstimatorXpress automatically produces report after report from the data in the estimate. Material schedules. Cutting lists. The lot.
Gantt charts, Build Programmes, whatever you want to call them. Use it properly and you’ll know what and who need to be on site when. With careful management you won’t use your profit on plant hire extensions, subbies doing nothing, extra scaffolding time and so on.
WANT TO BE A CONSTRUCTION FIRM WITH A BUSINESS PLAN? HERE’S WHAT YOU DO NEXT.
Call the HBXL Team on 0117 916 7898 and we can discuss how our estimating software, EstimatorXpress has an important role in getting you to where you want to be in 2022, whichever Plan you’re following.
We can also set you up with a no obligation 1-hour Free Business Review with our Team HBXL Business Coach Simon from the Better Business Group. BBG helps building firm owners win work and manage their businesses more effectively. Speak to us first or give him a call directly on 01707 859900. Just mention HBXL to him.