Being a General Contractor can be quite a challenge on any given day, but especially with the situation in the world now – Coronavirus pandemic closing up the construction industry – it turns out to be an enormous task.
At the beginning of the year, the prognosis was looking towards a bright and sparkly future: The AHR Expo 2020 Economic + Industry Report asked the respondents of their survey (1,418 attendees and exhibitor) how 2018 projections compared to the actual results of 2019. 70% reported at least 10% growth, while 34% reported significantly more than 10% growth.
Fast forward to March 2020, and we have a full-blown crisis in the construction industry worldwide. Adapting, in this kind of situation, allows the companies to survive. Knowing what can be the causes of failure and recognizing the main challenges can help you work against your extinction.
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According to BizMiner, of the 1,021,350 general contractors and operative builders, heavy construction contractors, and special trade contractors operating in 2014, only 722,281 were in business in 2016 — a 29.3% failure rate.
So what makes the General Contractors fail:
- Greediness – that makes them take more and more projects, without being able to take care of them
- Extending the scope of experience – taking a project in an area you have never worked before can turn out, more often than not, into a failure
- Improper cash flow aka Not Taking Care of Your Finances!
- Lack (or weak) Project Management – especially from the middle and higher-level managers that have a totally different view of life
- Lack of succession planning – the company, is the family inheritance but you don’t put your heart and soul into making it work
That being spelled out, what can the contractors do about all that? How can they adapt in order to face another day in the construction industry?
- Being too greedy can be a pain, but there are ways to escape that. The usual problem is the fact that you cannot get enough people in time to take care of the projects. What you need to do is think ahead, before this problem arises and:
a) Become a mentor – train your own future employees;
b) Hire women. Only about 10-11% of the construction industry is female, and they can contribute to decreasing the labor shortage;
c) Invest in a General Contractor ERP software for your team.
There are plenty to choose from! Take, for example, Archdesk, a construction management software for builders and contractors, that focuses on the processes you have inside the company & making sure you have the right data, live, at any moment – including tracking your employees and making sure you don’t double-book them.
- Making sure you have a steady cash flow, and making sure your Financials are up to date is key in survival! Most construction management software for builders and contractors also have integration possibilities with the top market accounting systems (eg. Xero, Quickbooks, Sage). The General Contractors ERP software solution that you will choose should allow you to keep track of your financials, create the bill of Quantities, and send it to your client online through the system. The General Contractor management software should allow tracking also the expenses made, the Purchase Orders, Sales, and Purchase Invoices alike.
- The Construction Management Software for builders and contractors available on the market are also focused on making sure the Project Management part is done correctly. The General Contractor Management software you choose should definitely have a Programme of Works (transferrable from Microsoft Project, if you are using the tool); the Scheduling module should be advanced enough to protect your team from being overbooked/double-booked on tasks. The General Contractors ERP software should stay on top of the Production Control process – knowing how your projects fair, no matter where you are located, and when you check the data on the platform.
The construction management software for builders and contractors should hold the structure of your processes and make sure that all that access the system follow it. Even if you are new in the company, if you have inherited it, you can still make sure things will run smoothly, with the help of General Contractors ERP software.
Choose a tool that focuses on your processes and make sure that your team follows it every step of the way. Have a meeting with the older employees, to understand how the company runs, and then implement it in the software of your choosing.
We know that being a General Contractor can be a daunting experience sometimes. Still, we firmly believe that a market-oriented management software, catered to your processes and your real needs, can help you stay firm in the Construction Industry.
A General Contractor management software should come to you as an extension of your team, of your processes; it should encircle the company and create bonds in-between the teams; it should allow you to move forward and stay alive and health – in good shape! Are you ready to select your ERP Solution?
If you are interested in even more technology-related articles and information from us here at Bit Rebels, then we have a lot to choose from.
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