Construction Contractors and Financial Crises Don’t Play Well Together

When a financial crisis hits the country it doesn’t play well with the building industry. Already in 2011 we see the statistics are down and the future isn’t looking too bright for everyone and not just the building industry. So how can a contractor protect their small business from this disaster brought about by lack of Government oversight and financial mismanagement?

Things You Can Do:

I have been spruiking on for some time now about diversification. If you put all your eggs into one basket and fall over, then all those eggs are either broken or cracked. Everyone knows that cracked eggs don’t last and if they are broken, well, good luck on trying to put something back into something that has already broken.

Once something has broken, it is never the same again. Sure, you can mend and reuse, but it still has a built in weakness.

The same goes for small contracting businesses that get damaged during financial crises. Once they have broken the business system they are never quite the same again.  Project builders go broke, Architects leave town and there is simply no money made available for new homes. People can’t get financing any more to build new homes.

So, its way past time to start diversification of ways to find work before the brown stuff really hits the fan.

One of the first things a contracting business can do is to keep in touch with all existing work orders and previous clients who may still be able to offer them some work. This work is likely to be more ‘little jobs’ than bigger jobs but they are money and pay the rent.

As hard as it will be staff needs to be downsized. Subbies have to be paid off and bills paid as soon as possible.  Once the bills and debts are brought up to date, there will be less pressure brought to bear by creditors all wanting their money at the same time and you will be able to see what money you have left over for some small ads in your local paper.  Don’t be misled by a sales rep trying to talk you into a bigger ad by saying that the bigger ads work better. This is not the time to be branding your business because what you are really after now is work.

Construction contractors and financial crises don’t play well together so it is time to go from base-to-base rather than try to hit a home run. By taking more care of your small contracting business will get you to home base by being prepared to run one base at a time.