If you are a general contractor, this is the year to take your small business or medium-sized business to the next level.
Whether you specialize in new construction, renovation, specialty trades like electrical, plumbing, carpentry, roofing, landscaping, this is a great time to be in the building industry. Business is on the uptick. Hey, even President Obama’s approval ratings are up to nearly 50%! Opportunity abounds if you position yourself for success.
Below is a list of six of the best ways you can set up your business to take off and acquire more clients, more cash flow, and more profits in the new year.
1. Get licensed.
Any contractor worth his salt, whether a general contractor or a specialty trade contractor needs to be state licensed and/or registered (where it’s required). As we’ve detailed, licensing for contractors works both ways, protecting your clients and enhancing your marketability. Consumers are more savvy than ever and the best clients are not willing to cut corners and work with shady workers who might disappear in the middle of a job, or do work that could be costly in terms of safety or financially. Licensing gives assurance to the public that you are committed to see the job through, in the best possible way and that you stand by your work. Use our guide to becoming a licensed contractor in all 50 states to find the requirements for your locality.
2. Get certified.
Beyond getting licensed, you need to find a way to stand out from the crowd. The best way to do this is to demonstrate your credential to clients. Reducing energy consumption is a big trend in the construction industry. Going green is finally profitable! There are many specialties in which you can get credentialed within the construction industry, from LEED certified to being a HERS Rater or certified by the Building Performance Institute among tons of other specialties.
Use our guide to specialty certifications in construction to get started.
3. Improve your cash flow.
When you hear the statistic about most small businesses going bust in the first few years of operation, what you don’t hear is that the major problem is cash flow. Even a growing business getting order will find itself with shuttered doors if it does have cash on hand to fill new orders, make new goods, or carry out services. It doesn’t matter to your creditors if you are worth a million on paper you can’t get to because it’s tied up in unpaid accounts receivables, excess inventory, or accounts payable to actually run your business. Are you having a problem meeting payroll? Scrambling to find the resources to take on new work? So busy paying the people you owe while letting your customers take their sweet time to pay you? All of these are deadly to your business.
The good thing is there are some simple fixes that can dramatically improve your cash flow, such as the following:
- asking clients for deposits up front
- shortening your customer’s payment terms (i.e.net 30 to net 15)
- asking your creditors for extended repayment terms
- converting receivables to cash (although this is expensive)
- being flexible in the forms of payment you accept (accepting credit vs cash and check only)
There and other steps are steps you can take to solidify your cash flow, but you get the picture. Paying attention to this critical facet of your business will ensure your success in 2015 and beyond.
4. Get the right business tools.
Did you know there is enterprise-grade software online free for the downloading? Last year, we put up a guide to all the open source and free construction software and online tools for small businesses. To be successful you need to be efficient with your time. Outsource where necessary. Work with subcontractors to enhance the services your company offers. Learn software that will help your operations, from design to billing, accounting and more. It’s all there.
5. Get savvy about online marketing.
While personal referrals and word of mouth are still king, the days of new clients finding you through a physical yellow pages book are OVER. It’s all about your online presence. Who shows up #1 or at least on the first page when your clients are searching for your services on Google or Bing or Yahoo? When it comes to online marketing, where does your website show up–on page 1 or page 25? Do you appear on ads in the search engines or on the sites your clients visit? Are you using the latest software to re-target potential customers who have visited your site so that your brand is on their mind at the moment they need you most? Do you have customers leaving awesome reviews for you on Yelp? Can your business be found in Amazon local or Google Maps? Do you have a can’t pass up coupon on Groupon? What about your social media presence? You don’t need to be wasting time tweeting your day away, but you need to be present and accessible wherever your clients are. Don’t leave your marketing up to third party companies that over charge you for weak leads that get shared with umpteen other contractors.
Take ownership of your online presence and get profitable leads for pennies on the dollar. The most successful contractors in 2015 will suck it up and finally take control of their online marketing. If you don’t other firms will and get the lucrative business and leave you in the dust. Don’t let that happen! If you don’t want to learn the online stuff (and it can be tedious) then outsource! There are even companies ranking sites in your niche right now that you can rent and essentially take over page 1 rankings without any work on your part. In fact, we offer that service. So, what’s holding you back? The days of relying on Service Master and other so-called lead generation companies is old hat. Get your own leads and keep all the profit.
6. Define your unique selling proposition.
What is it that makes you stand out from the crowd? Assuming your most fierce competitors are also licensed, certified and using top of the line software tools to advance their business operations, what makes your different? Is it in your background or training? Your attention to detail, or eye for design? Your dedication to customer satisfaction? Focus on premium services? What do your clients say about you to their associates? Find what it is that makes you unique and ride it all the way to the bank.
So there you have it. Six tips to make 2015 the most successful year of your contracting business. If you are brand new in the field, then these tips will skyrocket your business and profits, while ensuring a clientele that sing your praises and keep the referrals coming all the way to the bank.
This is your year to shine! Make it happen.