NEVER RUN A CONTRACTING BUSINESS BEFORE?
DO YOU HAVE YOU CONCERNS ABOUT HOW WELL YOU ARE RUNNING YOUR GROWING CONTRACTING BUSINESS?
You started your contracting business as nobody else had your passion for quality and building relationships. Your contracting business has grown and you are proud of what you have achieved. People now look up to you as a successful business person. You feel good about how your contracting business has grown but are concerned that an experienced business person could run it better. You feel that you must be missing something, as you do not have any practical business training. In particular, you are concerned about your lack of detailed financial knowledge. You believe an experienced business person would understand the finances better than you do. You also believe that your accountant is not the person to help, as they don't really understand construction and you are concerned that they charge you for information which does not help your business grow.
YOU DON'T KNOW WHAT YOU DON'T KNOW.
You probably started your career on the tools and learnt a trade or profession. During that training you learnt the tools of the trade and as you became proficient at your chosen trade or profession and you learnt the "Tricks of the Trade". You were successful at what you did and the next step was to become a business owner. Most business owners become owners without much external support. Cash is tight at the beginning, so buying in external support was not viable.Through sheer grit and determination the business has grown. You have gained work by word-of-mouth and your personal reputation. You are the business. You are now at the stage where you are concerned that you are not running the business in the same way an experienced business person would, but you "don't-know-what-you-don't know".What you do know is that the business could be better and you need some external help from someone who has been there before and has the experience to mentor you. My career followed a structured programme which took me from a "worker" to a "business person". I now mentor contractors business owners, if they would like some external business help.
A MENTORS JOURNEY FROM "WORKER" TO "EXPERIENCED BUSINESS PERSON".
Most SME business owners go from "worker" to "owner", missing out the formal learning at supervisory, middle & senior manager levels. I was very fortunate in my career to work for a business which had a very structured approach for promoting staff from a worker role to become a business person. I started my career as a setting out engineer. I learnt that accuracy and attention to detail was paramount. Millimeters can make the difference. I progressed to supervising others, and then managing a project. The "First-time-manager" followed by "middle-manager" courses helped me understand how to manage others in the project environment and how to manage the supply chain on site. The next challenge was to manage multiple projects run by others. This step took me to the "Senior manager" level and participation on the "senior manager" course, but I was still operating in the project environment.
The next step was a move away from managing projects to managing a profit centre in the business. I had made it to director level. The responsibilities changed, finding new work to keep the project teams going, dealing with staff and commercial issues became the day to day norm. In addition, reporting the figures & KPI's from the projects was necessary. The "First time directors" course, and an MBA, armed me with the tools I needed to manage a business unit. Finally, before leaving a large business I was given the responsibility of having two other profit centre managers report to me, and I became a more senior director and did the "Executive Leadership" course.
HOW TO START WORKING ON THE BUSINESS AND NOT IN IT.
For a business owner of a contracting business who has decided to start managing their business in the same way as an experienced business person would, where should they start? As they are already operating at a business level, the primary concern should be to ensure that there is a pipeline of profitable work and that it is being secured at the highest price possible. Without profitable work coming in the business will fail. Secondary to this is to sort out any performance issues and ensure that all works which are carried out are done so cost effectively, and be paid for fully and on time. Regardless of where you are on your growth journey, start by analysing what profit your current projects are making and deciding what sort of projects should be secured in the future. The aim is to then to win the tenders as the highest price you can. As an experienced business person I have developed a method for winning tendered construction projects at the maximum profit possible. The method is not difficult to follow, it simply needs to be applied with consistency and accuracy to be successful. As projects are tendered and won at the maximum profit, improving how the business is managed can be tackled separately. But don't take my word for it about how my mentoring can help you. Take a look what our clients have said and use the button below if you would like a no-obligation copy of the method of how to win tenders at the highest price emailed to you, by return.
"Before Peter started the program with us, our bidding did not have much logic. He introduced a discipline which now enables us to win profitable jobs, when we need them."
MD Electrical Contractor
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GET THE TENDER PRICE RIGHT
An overly high tender price is why you lose tenders and an overly low tender price is why you can lose money on a live project. Getting the pre-construction stage right is essential. Take a look at our pre-construction guide which covers, Marketing Strategy, Business development, estimating and tendering.
Price is undoubtedly a key decision for clients but when a contract is signed, the two parties are associated in the eyes of the outside world. Neither party wants to risk having their reputation tarnished by the other party's activities. Environmental, social and governance (ESG) issues are most likely to cause damage. Addressing those issues. so both parties are confident they will not be tarnished by their relationship, will ensure a contract does not fail at the first hurdle.