Consistency in Construction: Building a solid contracting business
Construction is far from the only industry that seas its up and downs. Many contractors are affected seasonally and everyone feels the pain when it comes to those long tail boom or bust cycles. It is impossible to say whether the industry causes a certain mania or if it instead just attracts those with a psychological disposition for it. Regardless of the cause, it is a common problem that many commercial businesses and residential customers end up having to deal with. A contractor has high aspirations for his business and the amount or variety of work that he can perform, only to get half way into a project and suddenly realize that he has bitten off more then he can chew. At this point, the situation typically does not end well. Sometimes the company folds, other times they just stop answering your call and move on to other work, and once in a blue moon you are able to convince them to actually finish the product.
Because such occurrences are so common, it makes you wonder what the motivation is behind such behavior. Are the individuals just bad people that are out to harm others? In most instances, the answer is emphatically no. In fact, it is usually the opposite case. How easy it is for all of us to come up with these big, hairy, audacious goals. We go through our data from last year, come up with our new projections hoping and praying for that 20% increase, and then set off to work with unbounded enthusiasm. Then reality sets in, the sub contractors start misbehaving, cash flow gets tight, or several customers have some serious complaints. Not as easy to stick to these initials goals and commitments when times get tough and the cycle thus reinforces itself.
To overcome this problem with constancy an entrepreneur need to be objective in his projections. Make sure that you are not aiming to high, set realistic expectations, and above all else plan for the worst. Optimism is a great motivator but beyond that it will just lead you down a dead end street and leave you penniless. When you decide on your core guiding principles there are no exclusions to the rules. It is a lot like how certain individuals will quote scripture or follow spiritual values only when it suites their immediate needs. Well religion doesn't work like that and neither does business. If you are committed to providing the best possible customer service then it means you have to do so regardless of the cost. Yes, there are going to be many situations where you end up having to fix a problem that is not even your fault. There will also be a few times that you will end up losing money on a job. If you don't have what it takes to do these type of things, it is better to just aim lower and try to consistently perform as an average player in the industry.