How to Increase Your Construction Business Revenue

Increasing Your Construction Business Revenue

In the construction industry, there are various ways to increase profit margins, even for newcomers to the business.

If you want to maximize profits and secure profitable jobs, these seven tips will provide valuable insight for running a highly profitable construction business.

1. Set profit targets

When starting a business, avoid vague goals like "more than last year" or "as much as possible." Instead, set realistic, written targets for overhead costs, job costs, sales goals, and profit goals.

2. Use good years to buffer lean years

Expect that there will be three lean years for every seven good years. This rule can guide your budgeting and financial planning. Make sure to buffer your cash flow during prosperous times in preparation for downturns.

3. Join trade associations and attend events

Network with firms and trades by joining local, regional, and national trade associations. Attend events hosted by these associations to connect with general contractors and stay informed about industry news and changes.

4. Find profitable niches

Identify profitable niches within your sector and allocate resources accordingly. Consider specializing in specific areas such as home additions, kitchen remodeling, period restorations, or commercial electrical projects.

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5. Minimize waste

Reduce construction waste to protect the environment and boost profits. Optimize designs to minimize material usage, store materials properly, negotiate supplier buy-backs, and donate unused materials to organizations like Habitat for Humanity.

6. Have a 24/7 marketing, sales, and customer service rep

Establish a professional website to promote your construction company. Your website should include a company bio, services provided, contact information, testimonials, job and career opportunities, and an FAQ section.

7. Decrease equipment downtime with consistent maintenance

Maintain your equipment regularly to avoid breakdowns and costly repairs. Keep track of equipment location, usage, and maintenance schedules. Encourage operators to provide feedback on equipment condition and address potential problems promptly.

By implementing these tips, you can increase profits for your construction business. If you need further advice on starting or planning your construction company, feel free to reach out to us.

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