Monday, July 06, 2009

Contractors: How to Land on Your Feet After the Recession

As construction companies and contractors know, times are bad. Really bad. I know of a number of companies that have closed or run out of money. Contractors are taking on smaller jobs than they ever have before. Times are discouraging. It would be easy to hide under the blankets until things pick up, but staying in denial will not ensure a successful business as the economy improves. Some contractors are still busy, but most are not. How can you position yourself to be more than competitive once business is on the upswing? Use your extra free time wisely, and you should come out ahead once the slow times are over.

1. Review your contracts and other paper work. Now is the time to make sure your contracts are in compliance with local law and written to protect your business. And yes, I do advise all contractors and construction companies to have an attorney review their contracts. This one step can save you thousands of dollars over the long term.

2. Determine whether you need to form a corporate entity. If you are currently operating as a solo practitioner or d/b/a, consult with both your accountant and an attorney to determine if you would be better off incorporating. It can protect you personally and give you peace of mind. It's also a great way to establish a brand.

3. Get in touch with former clients. Now is the time to check in with everyone you've ever worked for to see how they are doing. For all you know, it may be the impetus they need to start planning a new project. Even if clients are not planning something now, they will think of you because you got in touch.

4. Be honest if you've run out of money on a job. So many contractors are abandoning jobs nowadays. It is a losing proposition for all involved. Be honest with your clients. They will appreciate if you are straightforward and try to work things out and will still give you a good recommendation. Do not disappear!

5. Be compassionate. Today I heard a story of a homeowner who had planned to build a multi-million dollar house and was losing so much sleep over the deal that he wanted to break the contract. Yes, the contractor deserves something for the lost opportunity, but if you work with your clients, they will not only come back when times are better, they will recommend you to all of their rich friends.

6. Learn something new. The home builder's organizations offer lots of courses. Become a Certified Green Professional, Certified Aging in Place Specialist, LEED, you name it. Become state of the art in something, be it solar, insulation, or wood alternatives. Learn about the new lead requirements for home contractors. Make it so you have something new to offer.

7. Try some newfangled marketing. Start a blog, create a fan page on Facebook, join LinkedIn, Twitter and read up on social media. It is not a substitute for old fashioned networking, but you are losing a percentage of the market if you do not become somewhat tech savvy. At minimum, you must have a website. You can do your own on a site like godaddy.com for less than $100.00. By the way, buy a domain name if you haven't already done so and get rid of that hotmail or aol address. It's not professional.

8. Form strategic alliances. None of us are really solos any more. The stronger our connections, the more we have to offer our clients. Find great subs and form relationships with them. Research companies that do green insulation, solar and geothermal heating. Connect with architects and consultants so you can form reciprocal referral relationships.

9. Join networking and/or marketing groups. Some people love BNI. Join the Builders Association of Greater Boston (BAGB), the National Association of the Remodeling Industry (NARI) or other construction organizations. Demonstrate a commitment to the profession and network with other who operate at a professional level.

10. Consider hiring a consultant. A colleague, Mark Paskell, http://www.thecontractorcoachingpartnership.com/, consults with contractors and teaches them how to run their businesses. Another colleague, Brian Javeline, has an online show for contractors http://www.thecontractorshow.com/homepage.aspx and sponsors a software program called My Online Toolbox https://secure.myonlinetoolbox.com/content/affiliatesponsorship.aspx?r=TheContractorShow. Connect with someone like Bruce Irving who works as a consultant for home renovation projects: http://bruceirving.biz/

If you situate yourself as being one of the premium contractors or construction companies in Massachusetts, you will be.