Running a construction business comes with an array of challenges that encompass everything from providing clients with bids to visiting job sites to managing construction business operations. It’s essential to prioritize operations because when your day-to-day tasks aren’t going smoothly, it can impact every other aspect of your business.
At Select Funding, we help our construction clients by providing them with the working capital and guidance they need to achieve their most important business objectives. That includes offering advice about how to improve the day-to-day operation of their businesses. With that in mind, here are eight ways to improve operations at your small construction business.
There are some key factors to running a successful construction business, many of which play into your operations. Here are some of the elements to keep in mind:
There’s a need to focus on both the client experience and the bottom line, doing what you can to make sure that both elements work to help your business thrive.
Construction operations encompasses administrative and managerial tasks as well as on-site construction tasks that help keep a job within budget and on schedule. Here are some of the things that go into construction operations:
For a construction business to be successful, its operations must be well-organized, efficient, and cost effective.
An operations manager has several important functions in a construction business and these may include tasks that keep the office running smoothly as well as project-specific tasks. A larger construction company may have an in-house operations manager as well as a field operations manager.
An in-house operations manager may be in charge of creating and managing a business budget, onboarding and managing employees, ordering supplies and materials, creating bids for clients, marketing, and more.
A field operations manager may oversee several projects and is responsible for budgeting, estimates, deadlines, deliverables, and overseeing the on-site work of employees, contract workers, and subcontractors.
Here are eight ways that you can improve your construction business operations to achieve your financial and business growth goals.
Using software to streamline your operations makes sense and is a worthwhile investment. Construction management software can help you do the following things:
You can choose software that’s installed on your office computers or use mobile apps to manage these tasks. Either way, equipment financing can help you get the money you need to invest in technology.
One of the most common and costly mistakes that a construction company can make is inadequate or inaccurate planning. At the planning stage, you have the opportunity to learn about a project, including which materials you’ll need to complete it and how much time it will take.
You can improve your small construction business operations by dedicating the time needed to visualize a project and plan it as completely as possible. Proper planning will help you calculate which materials you need, so you don’t run out and put your delivery dates at jeopardy. Keep in mind, too, that proper planning will eliminate many potential problems ahead of time, resulting in better online reviews and higher customer satisfaction.
Building Information Modeling, or BIM, is a process that construction companies can use to visualize a project in its entirety before construction begins. You can use BIM to create a 3D model of each project.
Once you’ve created a model, your operations team and construction team can use it to ask important questions about how the building will be used and how to most efficiently and effectively build it. For example, BIM can help you choose the right water heater size or pump size for your project.
Communication is at the core of any business and is particularly important in the construction industry. Your communication policy should address both internal and external communication.
With internal communication, you’ll need to be sure that your employees and contract workers know what’s expected of them and that they feel comfortable coming to you with concerns and problems.
External communication should focus on providing clear, honest, and timely communication with clients to minimize the risk of misunderstandings or confusion. It’s best to have a system in place to be sure that clients receive regular progress updates and have a mechanism to reach you if there’s a problem or question.
Building enough profit into your bids is a necessity for any construction business to be successful. If you don’t have a handle on your material or labor costs, it’s easy to charge too little and end up in a position where no amount of speed will make a project profitable.
The key is to understand your material and labor costs, making sure to build in sufficient profit for you to meet your growth goals. Your bids should never be the result of guesswork, but should be created using accurate data and information gleaned from your experience and calculations.
Construction equipment plays an essential role in the success of construction businesses. With the right equipment, you can beat out your competitors, complete work to the highest possible standard, and stay within your budget while hitting all deliverable dates on time.
Of course, you’ll need working capital to buy the equipment you need, and that’s where the right financing can help. You don’t need to come up with the money to purchase equipment outright if you can qualify for equipment financing, which is something we do at Select Funding.
One of the most important things you can do to improve your operations is to choose key performance indicators (KPIs) and track them to improve every aspect of your small construction business.
Ideally, you should track financial KPIs as well as KPIs related to employee performance and other issues that relate specifically to the work you do. We suggest selecting KPIs, putting employees in the loop about what’s expected, and incentivizing employees to help you meet your goals with rewards.
Every small business needs working capital to succeed. Whether you need money to finance the purchase of necessary construction or office equipment, expand to a new location, or bid on large jobs, it’s essential to find the right financing partner to help you achieve your goals.
Select Funding provides affordable small business financing that you can use to hire and train employees, invest in new equipment, purchase supplies, improve your efficiency, or simply pay your overhead expenses without worrying about cash flow.
The bottom line is that improving your construction business operations can make your business more efficient and more profitable. The eight things we’ve suggested here can help you optimize your business operations to achieve your business growth objectives.
Do you need small business or equipment financing to help your construction business grow? Select Funding can help! Click here to read about our construction business financing and begin the application process today.