Issues That Will Cost You Money – There are several problems in the construction industry that affect specialty contractors more than other contractors. These problems will cost you money. You can’t account for them in your markup, but you can keep an eye out for them to protect your business.
Keeping a Schedule
In construction, the general or specialty contractor who can set a schedule and do their work on time is rare. This could cost you money.
When you set a schedule for the work that you do, make sure that schedule happens. If you’re working for a general, be upfront with him. Tell him that you’ll be calling one week prior to your start date. Call again the day before the start date to check the job progress. Assure him you’ll be on the job, on time, and you’ll get the job done by the time and date you’ve arranged. Now you’ve forced the general contractor to get that job ready for you. He’s on schedule, the job moves smoothly, and everyone is happy.
Who do you think that contractor is going to call for his next job? If you follow through, make the phone calls, show up on time, and do a good clean job, you’ll get most (or all) of that general contractor’s work in the future. Here’s the best part – If you do all of those things, you can charge from 10 to 20 percent more for your work.
On the other hand, advise the general contractor that if your crew arrives at the job and the job isn’t ready, you’ll bill him for trip time (an amount that will get his attention). Convey it politely but firmly, make sure he understands that you’ll carry through on this billing. If the general contractor doesn’t have the job ready, be sure you follow through! Bill him for travel time to the job. Why should you pay for someone else’s lack or organization? When he calls and tells you that the job is finally ready for you, fit him back into your schedule when it is convenient for you. Don’t reward tardiness or disorganization by inconveniencing yourself, your employees or other general contractors.
Using Construction Management Software is a smart way to utilize your schedule.
Competitive bidding is one of the issues that will cost you money, and it affects specialty trades more than others. Unfortunately, many specialists spend a lot of time and money learning this the hard way.
There are general contractors out there who only care about the low bid. They think your sole function is to supply them bids so they can sell their jobs as low as possible. They’ll cut your profit to nothing so they can make a little more money. Your goal is to secure work for your company, do not allow yourself to be used. Base your continued work with each general contractor on the total dollar volume of work that comes your way, not the number of jobs.