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Scaling Your Construction Business

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Are you ready to take on larger construction projects, but don’t know exactly how or where to start? This article will prepare you to take on bigger projects, make bigger profits, and help you know where to find them.

What is a scale in construction?

In very general terms ‘scale’ refers to an item’s size in relationship to something else.

Expand your team

All great projects start with a great team. You have to have both an internal and external team to take on larger construction projects.
Your internal team consists of your project manager and field personnel. Make sure both have the skills or experience in projects of all kinds of sizes and scales. You may need to hire additional fieldworkers to take on the amount of work you’ll be performing. It’s best to hire them before you need them and get them trained and ready to go.
Your external team includes subcontractors and suppliers. You’ll need strong team members here to ensure that you have the labor and materials you need to complete the project as scheduled and promised. Talk with your subs and suppliers before you start bidding on larger projects to make sure they are on board and can handle the added load.

Set up your finances

There are several financial considerations that go into taking on larger projects. They include ensuring you have the financing, insurance coverage, and bonds needed.
Larger projects mean larger invoices. You’ll have more expenses and more overhead on bigger jobs. Unfortunately, slower payments are also a regular occurrence on bigger jobs. Prepare ahead of time by requesting a deposit if you can or saving up additional money so you have a safety net. You can also look at temporary financing measures if things get financially tight.
Make sure you have the required insurance policies and limits to cover the project. Talk to your agent to ensure that you have the policies required by the contract, as well as the required limits. Not having enough insurance can put you in breach of contract and cost you more money in the long run.
Public works projects may require that you purchase performance and payment bonds to guarantee your work. You qualify for these bonds based on your work history and financial standing. Don’t wait until the end to find out your standing with bond companies. The more bonded work you do, the easier it is to get coverage.

Secure more equipment

Depending on the type of work that you are doing, you may need to invest in new equipment to meet the needs of larger projects. Assess your current fleet’s capacity and note any gaps or areas where you need additional help.
Purchasing new equipment is the way to go if you can afford it and know that the equipment will be used regularly. There’s nothing like buying a piece of equipment and watching it collect dust. If you can’t regularly use a piece of equipment, or you need a specialty product, look at renting or leasing.
Most companies rent or lease their equipment, especially the larger pieces. It’s economical and ensures that you have the equipment only when you need it. Otherwise, it can sit around collecting dust. Renting is best when you need equipment for the short-term, such as a few months or weeks. Local rentals jobs will deliver and haul away, taking care of the logistics for you.

Implement Advertising

The only people that can help your construction business grow are the ones who know it exists, so make getting the word out about your company a task. Use both traditional advertisements, such as newspapers and billboards, and modern forms of advertisement, such as Facebook Ads, to reach the largest audience possible. Advertising your business is a crucial part of finding both new clients and subcontractors, and both are needed to grow your business.

Why is scale important in construction?

As scales allow you to measure and monitor the amount of incoming raw materials and the exact output, this means you can accurately calculate the amount of resources needed for the next order. As a result, you’ll be able to foresee the amount of taxes and waste disposal fees that could be levied.

Where to start looking

Once you are ready to take on larger projects, you have to know where to find them. Besides networking with contractors and project owners, you can search on bid websites, like PlanHub, for larger projects in your area. PlanHub not only allows you to see projects and their scopes, but it also allows you to gauge the competition with its Competitive Analysis tool. Knowing your competition before you go in can save you time and money bidding on projects. For a demonstration of PlanHub’s search and analysis features, contact us today.

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