The Subcontractor’s Strategy to Exceed $10M in Revenue: Part 2 – Refine Your Internal Processes
In this 3-part series from Billd, we’ll continue to unpack the strategies that subcontractors can adopt on their way to $10 million or more. To ensure your business is ready for exponential growth, it is essential that you put in place scalable processes for the internal aspects of your business — that is to say, how you source, estimate, bid, schedule, and execute projects.
To take on the projects you need to hit your revenue goals, you will need internal processes that work for your business. In Part 2 of this series, we will explore what refined internal processes will look like.
1) Creating a Streamlined Business Process
The most successful contractors aren’t just good at sourcing projects — they’re prepared for them and diligently manage communications on newly sourced projects. Having a process in place is essential. For most companies, it makes sense to split this up by pipeline, meaning different pipelines have different types of approvals and communications. Different pipelines might include:
- Bid Boards
- General Contractors
Each of these pipelines requires different types of due diligence to determine first whether or not it makes sense to bid on the project, and second how many resources your company will need to allocate to estimate and bid on the project.
Estimating project expenses requires significant technical expertise, but perfecting an estimate is an art form. As a subcontractor, your estimates should be streamlined across all of your projects. To exponentially increase how many estimates and bids your company can produce, you should use estimating software and create a standard estimating process for every project you source.
In commercial construction, effectively marketing your business doesn’t come down to typical branding initiatives like logos, websites, or brochures (although that also helps). You need to build a reputation for reliability and quality from preconstruction through to execution. So, especially for newer subcontractors, it’s critical to understand how to submit accurate, trustworthy bids that set you apart from your competitors.
By including the right numbers and putting your best foot forward with these tips, you can put yourself at an advantage to win jobs — and build and maintain a strong reputation in the commercial construction community.
Construction scheduling is a comprehensive plan for completing a construction project by a given deadline. Different schedules are used for different construction projects, but each schedule should cover how, when, and what will be used to accomplish construction activities by specific dates.
If you don’t already have a scheduling system in place, now is the time to create one. It doesn’t matter if you’re working on one project or 20 projects. Scheduling will help you keep track of your resources and provide transparency for your GCs. Having a process to schedule construction projects is essential to growing your business and taking on more projects. Just like estimating, you should use scheduling software to streamline your scheduling process.
Executing your work seems like a given, but in construction, being able to perform work to the standards that you agreed upon is what will set you apart from the rest of your competition. As you grow your business, scaling your execution will be one of the most challenging aspects. For this reason, it is crucial to understand your labor and staff needs for every project. Taking on every project that you win doesn’t mean you’re going to be able to actually build them well. It is essential to understand your company’s capabilities to execute work, and your ability to pull in outside resources as needed, and not extend yourself to the point where you will no longer be successful.
2) Find the Right Employees
Your employees are your business’s lifeline between success and failure. If you’re doing less than $10M in revenue per year, you likely are making the majority of your hiring decisions yourself, and hiring the right people is key to retention as your business grows.
To say finding the right employees is difficult would be an understatement, but it can be done. The Ideal Team Player is an excellent resource if you are looking for tips on hiring employees, but here is the gist of it:
Find employees who are humble, hungry, and smart.
*It is important to note that smart just means people who are emotionally intelligent and have common sense about people.
Whether you are looking for office staff, tradesmen, or other contractors to partner with, these values will help you find the perfect members to add to your team.
We are fortunate enough to be in an industry built on the passing down of knowledge. In construction, you can teach virtually anyone how to work in the industry. This is to say that hiring for experience isn’t the only way to do things. If you can find humble, hungry, and smart employees, they will be able to succeed in a plethora of roles.
3) Develop Your Brand
When you are trying to grow your business beyond $10M in revenue, you have to learn how to showcase your business in a way that positions you for growth. In this section, we will go through some simple steps you can take to develop your brand.
- Photograph ALL your projects
Start doing this as soon as you possibly can. When people look up your company, they will want to see irrefutable evidence that you can do the work that you say you’re going to do, and pictures are one of the most effective ways to do that.
If you don’t have it in your budget to get professional photos of every project, even taking pictures on modern-day smartphones can be a great first step. Another option that might be available to you is using pictures that the general contractor on your project has taken. Simply ask your contact with the GC if they have or will be taking photos of your completed work.
2. Create a Website
Creating your website or hiring someone to build your website for you can be done relatively cheaply nowadays. The most important part of creating a website is showcasing your company’s work.
For a business of your size that wants a portfolio on the website, you can expect to pay anywhere from $2,500 to $10,000. Or, if you are tech-savvy, building your website in WordPress or Wix is an easy way to create a website for just a few hundred dollars.
If you’re still on the fence about creating your company’s website we still recommend that you at least purchase a domain name for your website. Using GoDaddy or a similar service is a quick and easy way to ensure that your company has a domain name to be able to create a website in the future.
3. Set up Social Media Accounts
The main social media accounts that you should use as a growing subcontractor are LinkedIn, Facebook, and Instagram. That being said, you should ensure that your names aren’t used by anyone else on other platforms. To do this, we recommend that you take a few minutes to set up accounts on YouTube and Twitter even if you aren’t going to be active on them.
LinkedIn will be your best source for business leads and engaging with current clients for your size of business. You should post pictures of your current projects and tag general contractors and people you are working with. You can post from your personal account or business account — it’s all about getting your company’s name out there.
At your current company size you probably won’t have a ton of time to run LinkedIn, Facebook, and Instagram accounts, but even posting every 2-4 weeks on any of the platforms shows people that your company is active, and can be a great way to showcase your work.
4. Make sure your Google Business Profile is set up
Creating a Google Business Profile is extremely simple and can be done in less than 10 minutes, but it can be a game-changer for people finding out about your business online. To set up your Google Business Profile, simply follow these steps on Google.
5. Know your differentiation in the market
In almost all circumstances there will always be other subcontractors that can do the same exact work that you can. That’s the nature of the construction business. That’s why knowing what your company stands for and what makes your company unique is paramount to your success. The value prop madlib is a perfect framework for you to quickly build your brand statement and help customers understand what differentiates your company from other subcontractors.
Here’s the value prop madlib framework:
For [target customer] Who [statement of need or opportunity], (Service name) is a (service category) That (statement of key benefit). Unlike (competing alternative) (service name) (statement of primary differentiation).
Here’s an example for Harley Davidson:
The only motorcycle manufacturer That makes big, loud motorcycles For macho guys (and “macho wannabes”) Mostly in the United States Who want to join a gang of cowboys In an era of decreasing personal freedom.
Once you have your own value prop made from this framework you can use that to build your mission statements, inform your logo, and every other aspect of your company’s brand that will help set you apart from the competition.
Although your online presence and showcasing your work are important, your construction brand is really the value you deliver in the field and the reputation you establish due to that work. Always provide accurately and reasonably priced bids, deliver consistently high-quality work in the field, and continually nurture your relationships with GCs.
A company cannot function without a healthy internal system of governance, satisfied employees, and a strong concept of its brand and associated values. Carefully establishing your internal identity will ultimately prime you for success in interactions with customers, suppliers and even competitors.
About Billd: At Billd, we provide a payment solution that enables commercial construction contractors to free up cash for material purchases while enjoying the flexibility of 120-day payment terms. You get financing for commercial materials upfront with the freedom to pay it back at your own pace. Learn more about how Billd can help eliminate your company’s cash-flow problems so you can win more bids and grow your business.