Congratulations! Starting your own construction business is a fulfilling and successful career choice. There are bound to be hurdles. But through our many years of working with contractors, we’ve heard a few things from the best of the best. Here is their advice of mistakes to avoid:
- Hiring reliable workers: Having a high turnover rate doesn’t bode well for a reputation. Although it very well may be that you’ve had bad luck in the hiring field, it could also raise a few questions.
- Underestimating your business startup: You probably have faith in your contracting skills. Do you have faith in the other component of a contracting business, namely the “business” portion? Running a business is a business in and of its own! There is payroll, overhead, buying materials in bulk, etc.
- Going in blind: To piggy back off the last piece of advice, not having a detailed plan for starting your business is important! Basically, invoke Murphy’s Law and think of everything that can go wrong and begin to find solutions for them. Do you need a surety bond? What equipment do you need? How will you handle your employees? What benefits will you provide?
- Build a good, scratch that, GREAT relationship with subcontractors and suppliers: Being able to call on reliable help can be a lifesaver! Subcontractors and suppliers are the base of your support. They’ll be able to provide specific expertise in materials and knowledge!
- Hiring the BEST: Know what makes a subcontractor or suppliers an expert, will help your business. By hiring the best, you ensure that your customers get the best. By having a great relationship with them, you will benefit from their talent.
- Having a good surety bond producer in your corner: To expand on the last piece of advice, having a knowledgeable, reputable and experienced surety bond producer to rely on can make or break your business. Almost all state or federal construction projects require a surety bond. A surety bond producer can open up that field to you, but a knowledgeable and experienced surety bond producer can make you competitive.
- Getting in over your head…financially: Make sure you have researched all aspects of your business. Knowing what a job should cost you, will help you to decide if you can take on the job or not. Do you know how much it will cost to buy/rent equipment? How much does a specific subcontractor charge? Can you buy the material in bulk? By having your figures researched, it will help to avoid underbidding on a project.
- Communication: Building any relationship relies on communication. By communicating directly, you are more likely to avoid conflict. But also be ready to be on the receiving end of communication. If someone gives you a critique, don’t ignore it! Instead, use it to better your business. A second set of eyes on a project or business can be positive.
- Paying yourself: This advice is two-fold. Some contractors have found that they forewent their own pay to further their business. Others pay themselves too much at a detriment to their business. Finding that middle of this balancing act will help to keep your business thriving!
- Your clients: Do you let flattery go to your head? Is a compliment something you thrive off of? Having clients who can be manipulative can hurt your business. The construction business runs on referrals. Therefore, some contractors may want to please their customers, which may mean doing a job at a cheaper price. When it comes to the bid process, communicate directly. And if there are any changes, make sure to have it in writing.
- Take time for yourself: We’re not suggesting jetting off to the south of France when you get your first big paycheck, but make sure to avoid burnout by taking time to breathe. Be it through a day trip somewhere or a night out with friends. You are the engine of your business, but maintaining your health and sanity level will help to make your business a huge success.
Running a construction business makes you your own boss, but can also be a tricky field to traverse. By following this advice, your business can thrive and be, the best of the best.
At Surety Bond Professionals, one of the things we pride ourselves on the most is our loyalty to our customers and our hard work ethic to make sure that our clients are fully protected and have the best chance at completing a job. We would be glad to offer you the same quality of service that have kept our customers coming back time and time again. Contact us today for any questions you may have, and let’s get started on assessing your surety bond needs.
