The construction industry faces challenges and successes as the market changes each year. Recently, your construction business may have become stagnant. If you’re struggling to find customers and keep your employees, it’s helpful to come up with a new business plan. Follow these tips for your construction company’s growth strategy.
Table of Contents
- How to Grow a Construction Company
- How Do You Scale Construction?
- Growth Strategies and How to Apply Them to Your Team
- Contact Coachfirm to Help Create Your Construction Business Growth Strategy
How to Grow a Construction Company
These steps can help you create a construction company growth strategy.
1. Define Your Value Proposition
As you figure out how to grow your construction business, it’s helpful to define your company’s purpose so you know how to move forward. A value proposition is a clear, compelling sentence that tells prospective customers what you provide when they invest in your services. It also reveals what your company stands for and how you operate as a business. Your value proposition should be persuasive and attractive to potential customers. Use your value proposition as a headline on your company’s website or place in the newspaper.
2. Identify and Measure Your Key Business Objectives
After you’ve created a value proposition, consider using the following key business objectives to measure your success and help your company grow:
- Maintaining a steady stream of income to make a profit
- Using your resources to increase productivity
- Providing excellent customer service
- Keeping current employees and attracting new ones
- Creating core values that drive your vision
- Cultivating sustainable growth
- Having cash or fluid income
- Adapting flexibility
- Rising above the competition
3. Understand Your Ideal Customer
Since your construction business should meet your customers’ needs, it’s helpful to know your target audience. When you’re focused on your ideal customer, you can make effective connections and provide what they want. For example, if you perform construction projects for homeowners, you wouldn’t advertise your services to commercial property owners. Think about your ideal customer’s characteristics, such as their age, gender, household income and geographical location. Create a persona type to help you figure out how to advertise to your target audience.
4. Pay Attention to Your Revenue Channels
Revenue channels are ways for your construction company to make money. Think about what services you offer that bring revenue into your business, and use your resources to maximize your profit. It’s helpful to diversify your revenue channels so you can maintain your cash flow during various market trends. Some of the popular revenue streams in the construction industry include:
- One-time contracts and bids from private and public works construction projects.
- Service work and ongoing monthly or annual accounts.
- Passive income from real estate.
- Supplying materials in a warehouse.
5. Watch Your Competition
Other construction companies nearby may be thriving in areas where you’re struggling. Think about what your competitors offer their workers and customers to determine where you could adjust your work environment. Stay ahead of the competition so you can retain your employees and bring in revenue from new customers.
Keep track of current marketing trends, such as using sustainable products, to attract a wider audience and beat the competition. You should also provide a positive work environment for your employees to keep them motivated to stay. If competitive companies offer more benefits or a more pleasant atmosphere, you might lose your best employees to the competition.
6. Consider Innovation
Think about how you can make your business run more smoothly to save time and money on your projects. Research disruptions in your supply chain and find ways to get products to your worksite cheaper and more quickly. Consider setting up innovative technology that allows everyone to be on the same page, such as:
- Construction sites with pre-fabrication and communication capabilities.
- Cloud systems that allow the whole project team to connect from different locations.
- Digital supply chains to keep track of your inventory.
- Artificial intelligence (AI) or other digital services to educate your employees on new information.
- Online databases to keep track of resources.
- Digital accounting services to send invoices to customers efficiently.
7. Evaluate Your Progress
Your growths strategy may involve improving your weaknesses, but you may also want to focus on your strengths. Measure your company’s success through key performance indicators (KPIs) that are relevant to the construction industry. These characteristics will help you meet your short-term goals and ensure long-term resilience.
You can keep track of your progress with the following KPIs:
- Safety: Having a safer construction site lowers your insurance rates, reduces risks and saves money long term. You can measure your company’s safety by keeping track of the rate of incidents at your worksites or how often you’ve had to have a safety meeting.
- Quality: Provide better quality services to improve customer satisfaction and reduce the time and money you spend on a project. You can measure your projects’ quality by the number of defects you’ve had per project and the time and money spent to fix the issue.
- Performance: Measuring your team’s productivity on each construction project helps identify where they’re exerting most of their effort so you can plan your resources accordingly. You can measure your team’s performance through downtime, the amount of revenue earned per hour or the waste or recycling produced per job.
- Employees: Workers who are happy with their jobs are more likely to be motivated, so they’ll produce better results and bring in more customers. You can measure employee satisfaction by looking at turnover rate and training completion.
How Do You Scale Construction?
Scaling your company means adjusting to its employee and customer growth. As your business improves and changes, you may discover that some of your old systems don’t work anymore. You can ensure success during this change by:
- Keeping it simple: As your business grows and changes, your team might get complicated. Keep everyone on the same page by creating an efficient flow of communication. Designate people for specific jobs so that everyone knows their responsibilities. You should also try automation tools to reduce the amount of work everyone else has to do.
- Prioritizing new and existing customers: Even though you should think about attracting new customers, you should also remember your existing ones. Find ways to make both groups feel important. If all your clients are satisfied, they’ll be more likely to recommend your business to others.
- Investing in the right technology: You should update the technology for your construction company to operate your business more efficiently. Research what resources would be best for your team’s every day operations. Think about what you could make digital to save paperwork, time, energy and money.
Growth Strategies and How to Apply Them to Your Team
Here are some of the ways you can use the following growth strategies to improve your company:
- Create a mission statement: Your company’s mission statement inspires you and your team to pursue growth, and it attracts potential customers. You may want to have a team meeting to discuss your mission statement so that everyone feels included and significant.
- Identify your goals: As part of your mission statement, think about what you’d like to accomplish. Make a list of SMART goals, items that are specific, measurable, attainable, realistic and time-sensitive. Consider asking your employees to come up with individual goals so they can stay motivated.
- Perform a SWOT analysis: Review your company and figure out its strengths, weaknesses, opportunities and threats. You may want to send out a survey to your employees to discover what they think. Find ways to build your strengths, improve on your weaknesses, explore new opportunities and eliminate threats.
- Look at a construction company strategy example: Research other construction company’s growth strategies and figure out how you can incorporate what they’ve done in your own business.
Contact Coachfirm to Help Create Your Construction Business Growth Strategy
If you need help creating your construction business growth strategy, work with a business coach at Coachfirm. Use our small business self-assessment questionnaire to discover more about how you need help with your business. Fill out a contact form online or call 888-777-0303 for more information about how to grow your construction company.
