With economic conditions being as tumultuous as they are, the construction industry has been hit especially hard, to no fault of the contractors who work in it. Unfortunately, unlike the large corporations, no one is going to step in and bail you out of your situation. Qualified Remodeler Magazine conducted a survey amongst their readers to drum-up 40 ways to increase your profits.
Here are some of the suggestions they came up with, along with a few of our own.
- Know where your money is going, the small stuff really adds-up. If you budget more efficiently, you can potentially cut costs and allow yourself more of a profit.
- Try your hand at reducing the price of some of the insurance policies you have to carry. Shop around and try to negotiate better prices.
- Contractors are suffering, but so are suppliers. When they send their sales people out to charm you, see if they are willing to negotiate lower prices.
- Try to reduce waste by recycling materials and using those small pieces you might normally throw away.
- Do more of the project yourself instead of subcontracting the work.
- Workers’ compensation rates vary based upon the work being completed. Consider doing the more expensive jobs yourself, or consider hiring a less expensive subcontractor.
- Target what projects net you the most profit, and pursue those over others if possible.
- Discretely look for other jobs while on site, you never know how one job can lead to another.
- Offer an incentive to your customers for repeat or referral business.
- Treat your employees well. It costs money to rehire and retrain new employees.
A smart business plan is the key to surviving this economic crisis; take a few minutes when you get the chance to reevaluate your operation and look for ways to adapt to the current conditions.