Small Business Growth in the Construction Industry
Tuesday, July 25, 2006
Some business owners prefer to stay a small, niche company. Others want to expand to increase market share and revenue. Whatever you decide for your building, remodeling or repair business it's important to plan ahead for it. If you stay small, you will need to keep up with change. A company that does not adapt to a changing environment can wither away or lose business to other companies that do. Limiting growth may mean turning work away. Hard to do, but it's important to maintain quality and customer service. The key is to have plenty of job leads available so that the most profitable jobs are chosen.The owner of a small to medium-sized company can choose to grow, but it is important to avoid the dangers of growing too fast. There are two main reasons that most U.S. companies fail - not enough capital and growing the business too fast. You have to consider that rapid growth can lead to hasty hiring decisions, poor quality work, purchases of new equipment, outgrowing a lease or a building, and more. When growing a business, it's necessary to have a solid infrastructure for recordkeeping, accounting, and personnel. As a company in the construction, renovation or repair business, it's important to not let the work suffer and to keep up with current levels of customer service. Not doing so can lose you important referrals. There can also be strained relationships if family or friends are involved: your brother-in-law may have been great at hanging drywall, but not at managing a large crew. It may also mean less hands-on work for you and dealing with more administrative or sales work.
Experts agree that in today's hyper-competitive world, limited growth may be required just to stay in business. As your competitors grow, their costs of supplies go down while their advertising budgets increase, leaving you with very few jobs.
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