8 Horrible Mistakes You’re Making In Construction

Welcome back and thank you for reading the January edition of this newsletter. I know it’s the start of the year and I always like to start off in a positive way, but this month I will be talking about obvious mistakes that are being made in construction. But don’t worry, as my aim is to talk about how to avoid them.

First in at number 1, Hiring the wrong people.

It’s a big one and can be very costly in terms of cash and reputation. A company with the wrong team will slowly sink the ship.

So how do you know if you have hired the right person?

There are a few things to look out for and here are some questions to get you thinking:

1. Do they have the right attitude, do they buy into your company culture and ethos?
2. Do they have the right skill set to carry out the tasks that are required?
3. Will they contribute to the team and the business in terms of engagement and ideas?
4. Can you trust them?
5. Do your tradespeople have the right qualifications and experience to back it?

If you can answer yes to all of the above then you are on to a winner. Remember if you’re a business owner then you have probably built something from your reputation. You don’t want to let that go.

Hire smart and plan for the future. You may want to think about hiring the services of a reputable recruiter and working through the right candidates with them. This will save you a lot of time.

Be patient, waiting a little bit longer for the right candidate will be worth it in the long run.

Last, of all be thorough in your process.

Number 2, Poorly estimated projects.

Over the years I have seen some tenders that quite simply want to make me cry. Why, because they usually lack thought, knowledge and the right amount of attention hasn’t been applied.

Every project starts with the estimate and at this stage it’s your chance to demonstrate your understanding, skill set and how you are the right company for the project.

It’s also at this time when you can get it horribly wrong in terms of cost. Not putting enough thought and due diligence into quantifying labour, materials and preliminaries can empty your bank account before you have even started.

So what can you do to avoid these situations?

Always allow yourself the right amount of time to tender the project properly. If your client wants something quick, always try and be upfront in explaining why you cannot return on those timeframes.

Being aware that usually, we are also dependent on our own supply chain, plus you will want to counter in the fact that will want a couple of different prices for certain products too.

Then think about your labour. Have you got enough information and project timescales to make the correct allowance? Do you understand what the client wants? Is there anything in there that can be a problem?

In the end, try and top it off with a well-presented set of bid documents. These can include case studies of similar projects, project proposals (VE) and your inclusions and exclusions.

Bid to win at the right price, adding quality and with as little risk as possible.

The remaining 6

I won’t go into as much detail on the remaining 6 as I do not want to overload with negativity this early on in the year, but here they are:

3. Inefficient Process — Make sure your team understands what needs to be done throughout the project life cycle.

4. Scaling growth the wrong way — Too fast or too slow can both present problems along the way.

5. Not managing cash flow — This one is a no brainer. No cash, no business.

6. Failing to plan for the future — Not having a plan is a mistake. Having targets and goals will give you something to focus on and drive your team towards.

7. Bidding without a strategy — Linking with no plan for the future, the same goes for bidding and sales. Sales plans and specifically targeted clients will give focus when bidding. No one likes to just be a pricing machine with zero results.

8. Not checking your clients before you do business with them — This can be a fatal error. From the outside, your prospective client may display all of the signs of being a healthy company. But you may be wrong. A simple credit check will help with this one. Also, what is their track record with other clients, what are their staff like, what is the company culture? If it’s not something that matches yours, are you sure you want to be in business with them?

Now back to being positive…

All of the above are easily avoided mistakes and your subcontracting business does not need to make them. If you are still with me this far into my words then chances are you may be silently laughing about the time you may have tripped up on one of these mistakes, but your business is now stronger for it.

If you have some questions on the above and need some guidance on your next move then feel free to fill out the contact form on this page.

Have a great year and until the next time.

Sam

Originally published at https://masconsults.com on January 10, 2022.