Strong relationships between general contractors and subcontractors are an important component of a successful project. These relationships don’t mature overnight, and it takes time and effort from both parties to build a level of trust that evolves into a strong working partnership. Putting in the work to build these relationships can be mutually beneficial to both parties and pay off for years to come.
As a general contractor, building strong relationships with your clients is important to your company’s success. Good client relationships can lead to repeat business, referrals, and word-of-mouth marketing. A good working relationship built on trust and understanding can go a long way when issues arise on a project.
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There's over a 50% chance the United States could slip into a recession within the next 18 months according to TD Securities. The construction industry really took it on the chin during the Great Recession. The number of construction firms fell by nearly 150,000 between 2007 and 2013 and over 2.3 million jobs were lost due to layoffs, early retirement, and workers leaving for greener pastures.
Many contractors and owners of construction firms focus on strategies rather than what really makes a difference in improving their businesses. Unlike other industries, construction companies face difficulties in generating revenue. It becomes challenging to get forward with, or even stay ahead, due to extremely slow billing instances and poor profitability.
Pride Month is a reminder for people to be proud of who they are and specifically for amplifying the voice of the LGBTQ+ community. One of the sentiments behind pride encourages us to validate the person we are, whether we share our unique identities with others or not. We spend a lot of time at work, so it’s crucial that our work environment is a place where we can show up and be supported so we can focus on the work, no matter our race, religion, gender, age, ability, etc.
Labor shortages are one of the major issues the construction industry is struggling to overcome. For many construction firms, keeping their workforce fully staffed is their biggest challenge. The Bureau of Labor Statistics reports that in March 2022, there were 396,000 job openings in the construction industry, up from 383,000 in January and February.
In construction, late payments are common, and it takes considerably longer for construction businesses to get paid. For construction businesses, the average daily sales outstanding (DSO)—the time it takes to collect on invoices—is 60 days. The general DSO average across various business sectors in the United States is 45 days.
Is your construction firm planning to increase headcount in 2022? That could prove to be a difficult task. According to a recent survey by the Associated General Contractors of America, 88% of construction firms indicated they are experiencing project delays and worker shortages are the second leading cause (61%) cited behind longer lead times or shortages of materials (75%).
I hate to state the obvious, but if you are planning a new commercial construction project, your work has already begun. Break out your to-do checklist and prepare for what may not be as obvious or simple to calculate. These would be the costs, both planned and unpredictable, involved with bringing a commercial project to life. The steady uptick in costs from year to year has made access to materials, land, and labor a tough commodity. Detailed budget planning and strategy are necessary during preconstruction to bring the bottom line to light before your project hits rock bottom.
All construction projects carry some level of risk. Being able to identify and manage risks requires skill, careful planning, and being able to make good decisions quickly. When risks become reality, they can be detrimental to the successful completion of your project. Properly managed risks can lead to higher profits, stronger relationships with clients, and the ability to grow and expand your business.