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Why Is Change So Hard?

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This Seems Especially True for Construction

Change is the biggest issue that the construction industry faces. Why are people in construction so bullheaded? They are some of the most stubborn and headstrong people. 

This starts at a young age. As children, we have fewer external experiences to draw from. This restricted resource limits our view. This is why young people think they already know everything. 

This narrow perspective then becomes our standard and we see no reason to change. 

I think this is why resistance to change is so prevalent in construction.  

We’re like little kids that started out working for someone. We learned how they did things by watching them. This is why when we start our own construction business, we think we already know everything. 

I was a dreamer at an early age. I had big ideas and plans for my life. A part of this dream was to have a big, successful construction company. I was going to build great things. 

So, I worked for a few different self-employed contractors and then started my own construction company… 

Because I already knew everything.  

As I grew up and those dreams weren’t happening as I had envisioned…I became disillusioned. I gave up on those dreams and accepted that they were just that…dreams. This is when the grind of life sets in. It was disappointing to accept that this is all there is.  

It was frustrating, just plodding along day after day feeling stuck with no way out. 

Then, one day I was smacked upside the head and had a life changing wake-up call.

In December of 2012, I was literally hit upside the head with a board among other things. We were installing wafer board boxing on the wall of a second-floor addition. I was standing on a plank approximately 8’ above the ground when…it broke. 

Fortunately, I don’t remember any of this ordeal from the time I was measuring until I woke up in the hospital three days later.  

Based on what I was told by the guys that were there when I fell, I hit my head on one of the ladders, then on the concrete slab, and then the board hit me on the head. It sure is good that I have a hard head. Seriously, I was fortunate that I came away from this accident with only a concussion. 

The point of telling you this is that it caused me to reevaluate what I was doing and how I was doing it. 

This incident made me aware that something was wrong and if things were going to change…I needed to change it. As I was looking to understand what was going on, I began to read. The more information I gathered, the more I learned about what needed to change. 

One of the first books I read was The Traveler’s Gift by Andy Andrews. This book teaches seven fundamental decisions for creating a successful life. It gives you a front-row seat for a man’s journey that changes his life.  

In the book, David Ponder lost his job and his will to live. He supernaturally travels throughout time visiting historical figures such as Abraham Lincoln, King Solomon, Anne Frank, and more.  

Each visit yields a Decision for Success that will change his life if he implements them. 

This book showed me that I, like David Ponder, had a choice.  

Was I going to keep doing things the way I had been…or was I going to do something different? 

I decided to change and do something different.  

When we’re young we think we have all the time we need. There’s no need to think about the future…we’ll get around to that someday. Then, one day we wake up and realize life has flown by and we haven’t done the things we wanted to.  

You don’t have to wait until you’re smacked in the head to make changes. 

I made changes to my life and my business. People who knew me before and after can see the improvement.  

Change is a choice, and you can choose to change. 

If you’re in construction and would like to learn more about some of the changes I made and how you can make those same changes, check out solutions for building a better construction business. You can also check out our business building tools and trainings or schedule a free 30-minute construction company consultation to learn more.

What Made You Start Your Construction Company?

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If You’re Like Most People in Construction, You Don’t Know…

Last week we discussed how 96% of construction companies go out of business within the first 10 years. This is a problem if you’re in construction.

As I was discussing last week’s post with a friend, he asked me why I do construction. Why would anyone want to start a construction company with odds like this? This question started me thinking about it.

Why is anyone doing construction if the chance of staying in business is so stacked against them? This question prompted me to reach out to some people in construction and ask them.

Why am I doing construction and how did I get here?

When I was growing up, I knew exactly what I was going to do. I was going to farm with my dad, just like he was farming with his. This was going well until those plans got changed.

When I was in my early thirties my dad died of cancer at fifty. This wasn’t a part of the plan.

At that point we were farming together, he owned some of the equipment and I owned some. The problem was, I couldn’t afford to buy his part so…I got out of farming.

In addition to farming, I had been doing some construction in the winter. I liked doing it, was good at it, so this seemed like the logical thing to do.

The problem was I knew construction…not business.

So, why are others doing construction and how did they get here?

To answer this question, I reached out to some people I know that are in construction and asked them the question…Why are you in construction?

I’ve known Doug Wright, with Wright Floor Leveling, for years and have used their company for a variety of projects over the years. They do foundation repair/replacement, crawl space repair, basement repair, masonry repair, new masonry, and more.

Here’s Doug’s story: he did not plan to go into construction…he planned to play football. Then he was injured in college, and it ended his football plans.

His dad was a stone mason and Doug needed a job, so he went to work for him. As things progressed, he became more entrenched in the business, and the prospects for change became harder and harder.

Not to mention that he wasn’t a fan of change.

So, Doug is doing the construction that he knows and is good at.

Chris Schovan is a painter that hasn’t been in business too long but is great at what he does.

Chris learned to paint as a young man from his grandpa who was a professional painter. His grandfather told him that knowing a trade would always give you something to fall back on.

He was working for a pole barn company and/or in manufacturing when the pandemic hit, and he got laid off. Then someone at church needed some painting done and asked him if he knew any painters. He ended up doing this project which led to other projects and he’s now as busy as he’s ever been.

He likes the freedom of schedule because he doesn’t have to punch a clock.

I use Chris because he provides great customer service and does quality work.

I’ve known Josh Dobbs of Flint Ridge Service and his family for a long time. Josh was a firefighter and planned to be fire chief someday until smalltown politics derailed that dream.

While considering what to do next, he was talking with some guys in real estate and the glass business who told him there was a need for someone to do handyman-type things. So, he started doing some odd jobs. As the demand grew, so did his business. Now he does a variety of construction, excavation, and fencing.

He had never done construction before he started doing odd jobs.

Josh uses the leadership skills he learned in the fire department and the ability to see a need and then figures out how to do it.

Leonard Mumford, of Mumford Contracting, is the owner of a full-service construction company. Leonard and I work together in a variety of different ways.

Leonard was in construction years ago and after going out of business, he swore he would never do construction again. He worked in oil field and sales but was miserable. Then he had the opportunity to do some construction work on the side and was making more money part time.

Then his son convinced him to go back into construction…which he swore he never would.

Now Leonard is doing more construction than ever.

The common thread in all these stories is that none of them grew up dreaming about going into construction…playing football or being a fireman, yes, but not construction.

Not everybody knows what their vocation is going to be. Things happen and we have to shift and make changes. These changes, some big and some small, lead us down paths that we didn’t plan for.

This lack of preparation and planning is why 96% of construction companies don’t make it past the 10-year mark.

Three of these five examples here have made it past that point, but trust me, this doesn’t mean that everything is smooth sailing.

All of them have expressed concerns about the business side of things.

This concern is common and why at Solution Building, we’re working to help construction companies with business tools and training to alleviate some of those concerns.

If you would like some help with your construction company’s struggles schedule a free 30-minute consultation.

What Makes the Production Tracker Such an Important Tool?

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Because it Helps Keep Your Business Balanced

Recently we discussed the importance of keeping your construction business from getting out of balance. Achieving a balanced business requires paperwork and we know how construction contractors feel about paperwork.

I know, I know, paperwork is not a very exciting topic, but neither is concrete. And we all know how important concrete is in supporting a building. The same is true for paperwork and your business.

One of the three foundational piers in business is administration and finance. One of the building blocks in that pier is a Production Tracker. This tool provides valuable information for forecasting the company’s financial needs and production plans.

Wouldn’t it be helpful if you knew:

  • Which types of work were consistently the most profitable
  • How you were doing at meeting your financial goals for the year
  • When you should have the signed projects finished to stay on track
  • How well you’re doing at getting proposals signed
  • What the average price of your projects are

The Production Tracker is an Excel spreadsheet that lets you gather and track information. It has preset formulas that determine and sort the information you need to make your business more profitable.

This document provides information for:

  • Creating and recording project numbers
  • Tracking project bid amounts
  • Tracking dollars of signed proposals
  • Tracking dollars collected from projects
  • Percentage of jobs signed
  • Percentage of dollars signed per dollars bid
  • Percentage of dollars collected per signed
  • Average dollar amount of projects bid
  • Average dollar amount of projects signed
  • Average dollar amount of projects collected
  • Projected timeframe for doing signed projects
  • Projected date work should be done

This list can seem overwhelming but it’s really not.

Here is an example of what the Job List spreadsheet looks like.

Let’s go through the document and break it down into smaller brick size pieces.

Creating and recording project numbers – Having a numbering system can help you sort projects so that you can review which types and size of projects are the most profitable and what you do the most of. It may be that your most profitable ones are not the ones you do the most often. Having this type of information can help you to focus more of your attention on the right kinds of projects for you.

This Production Tracker is a place to list project numbers in conjunction with the size and types of the projects, as well as their chronological order. This document provides the numerical part of the project number specific to each project. The other portion of the project number is determined by job specific parameters that are not included on this document.

Tracking project bid amounts – Our Blueprint for Building a Better Proposal system provides the dollar amount for each project. Once a proposal has finished, the specific information to that project is entered into the appropriate cells on the spreadsheet. This information includes Job Number (column E), the Customer Name (column F), Description (column G), Bid Date (column H) and the Project Amount (column I). Regardless of the system you use for preparing proposals, you should have a dollar amount that could be entered into this document.

As each new project amount is added in the project amount column, the total project amount at the bottom will update, giving you a total dollar amount of the proposals you have done this year. Based on your company’s history, this dollar amount should give you a clear picture of where you are in relation to meeting your financial goals for the year. We will explain this further with the tracking dollars of signed projects.

Tracking dollars of signed proposals – Once a proposal has been accepted, the accepted dollar amount should be entered in the signed amount column. Initially, this amount should be the same as the amount in the project amount column. Sometimes the dollar amounts of projects are changed due to change orders. This can be either an increase or decrease depending on the change order(s).

As each new proposal gets signed the dollar amount of the signed proposal should be entered into the correlating cell in the signed amount column. Just like in the project amount column, as each new amount is entered in the signed amount column, the total dollar amount at the bottom automatically updates giving you a total of work you must currently do.

With the total of the signed amount column and the total of the project amount columns, you should be able to get a clear picture of where you are financially in relation to where you want to be at year end.

Let’s say your goal for the year was to generate a gross revenue of $400,000.00. Using the example, you can see that as of December 12th you were at $352,877.66. This is close, but not quite there. If you compare the signed amount to the project amount ($664,381.27) you will see that the signed amount is 53.11% of the project amount. Based on this percentage, to get the signed amount to $400,000.00, the project amount would need to be $754,000.00.

This information is critical to the survival of your construction business.

Your business needs to be built on a solid foundation.

We’ve covered a lot here today. In our next post we’ll pick up at tracking dollars collected from projects.

Check out this and additional business building tools and training here. If you have questions, feel free to schedule a free 30-minute business coaching call.

Portions from a previous post 1/7/23 

The “Job List” Is One of the Foundational Building Blocks of a Successful Construction Company 

Building Anything is Better When You Start with a Plan

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So Wouldn’t You Like a Plan for Doing Construction Proposals

It’s Saturday, and today will be Gene’s third meeting with John. Even though there’s been no change in Gene’s overwhelming workload, today is the first time he’s not considered canceling. He knows the value of this information and is looking forward to the opportunity to learn more from his mentor.

It’s Gene’s turn to provide lunch and John’s in for a treat…Gene’s bringing chili-cheeseburgers and fries from the Burger Station. Driving to John’s office, the smell of those burgers is more than Gene can bear, so he samples a few fries on the way, just to be sure they’re okay.

Gene had barely gotten in the office door before John yelled out from the conference room, “You brought Burger Station!”. Over the years when Gene was working for John, the two of them frequented this fine establishment often.

As Gene gets lunch out, John says, “We have a lot to cover today, so we better get started. As we go through this today, think about building a proposal as compared to building a construction project. Now let’s review…

First, we started with WHY…

Why do you do what you do? Why should you do proposals? Both these questions are similar to the question we should ask customers when they’re considering a construction project. Why do you want to do this project?

Second, we discussed that communication is the contractor’s responsibility.

We are the professionals in this arrangement. We shouldn’t expect the customer to know everything about construction. This is why they are looking to hire someone to do their project. It’s up to us as contractors to communicate clearly.

Third, we discussed bid mistakes. 

These mistakes are commonly made and are costly. Being aware of them ahead of time helps you know what to avoid and increases the opportunity for happy customers. Not to mention it gives you a big advantage over your competition.  

In our meeting two weeks ago I gave you the proposal overview to take and review. Today we’ll go through it and break it down. I know it seems like we’ll never get to actually doing a proposal, but think about it like a construction project…

The designing and planning take as long as the construction.

Let’s start by looking at the documents included in the system and a brief description of each.”

Bid sheet – A Word document with the various construction categories and individual tasks listed with space for filling in the scope of the work to be done, dimensions, materials, locations, etc., for each category as needed for clear communication.

Worksheet – An Excel spreadsheet with all the construction categories and individual tasks listed with overhead and profit markup formulas.

Proposal – A Word document with space to fill in pertinent information, i.e. customer’s information, what will or will not be supplied by the contractor, the scope of work, the proposed price for each specific element, a total project price, payment arrangements, and project duration.

Data Base – An Excel spreadsheet with prices for material and labor for a wide variety of specific construction tasks. This information will be used in the worksheet template.

After reviewing and discussing these documents and definitions, they looked at the process of doing a proposal.

STEP 1 – Gathering Information

Gathering the right information correctly and effectively is critical to preparing an accurate and thorough proposal. Once you’ve been contacted by a potential customer, start by scheduling a meeting to discuss their project and find out what they hope to accomplish. At this initial meeting gather –

            Measurements and dimensions, existing and new

            Building materials, existing and new

            Pictures of pertinent areas and existing construction

            Customer’s design ideas and finishes

The information gathered at this meeting can be recorded in whatever way works best for you. The important thing in this step is to gather any and all information needed to prepare an accurate proposal. It can be handwritten on a printed out Bid Sheet template, or it can be entered directly to a Bid Sheet on a tablet, smart phone, or laptop. Using the Bid Sheet minimizes overlooking things because the different areas of a construction project are already listed.

STEP 2 – Preparing the Scope of Work

After the preliminary information has been gathered it’s time to clarify the scope of the project by writing out the description of each specific task in terminology that both the customer and the contractor understand. It needs to include enough specifics to be thorough without being too technical. It doesn’t help communication if the terminology is confusing to the customer. This written description on the Bid Sheet will be transferred to the Proposal and serve as a written scope of work to be performed and materials to be provided.

STEP 3 – Pricing the Project

Next is putting prices to the project. This process involves two different Excel spreadsheets, the Worksheet and Data Base. Based on the descriptions written on the Bid Sheet, content from the Data Base will be copied and pasted into the correlating cells on the Worksheet. After the pertinent information from the Data Base has been placed on the Worksheet, it’s time to fill in the quantities.

STEP 4 – Quantities

On the Worksheet you will fill in the quantity needed to do the work on that line item. This may be lineal feet, square feet, square yards, cubic feet, cubic yards, numbers of pieces, etc. Once this is completed you will now have prices for each of the different tasks listed on the Proposal.

STEP 5 – Preparing the Proposal

Now you have everything you need to complete the Proposal. You will take the descriptions from the Bid Sheet and the prices from the Worksheet and put them both on the Proposal. After filling out the customer’s information at the top of the page, the scope of work, the price for each task, the total project price, how payments are to be made, and the duration of time to do the project, the Proposal is ready to be presented to the customer.

As they wrapped up the meeting, John looked at Gene and asked him what he thought so far. Gene said, “I had no idea there was this much to doing proposals.”

John said, “I know. That’s why most contractors either guess at their bids or just give estimates…and we’ve all seen how that well that works out.

Next week we’ll dig deeper into GATHERING INFORMATION.

If you’d like more information about the proposal system referred to in this blog post, you can check it out here. You can learn more about some of the other tools for building a successful construction business here. If you have any questions, schedule a free 30-minute construction company consultation.

Previous posts in this series:

What is “business clarity” and how do you find it? (12/24/23)

What Does it Take to Build a Successful Construction Company (12/31/23)

It’s Time for the First Meeting (1/14/24)

Being Aware of Bid Mistakes is the Best Way to Avoid Them (1/21/24)

 

What is “Business Clarity” and How Do You Find It?

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You Start with a Plan

Once again, Gene was alone at the office late on a Saturday night working to get at least one more proposal done, before going home. He had promised four different customers their proposals this week. If all goes well, he’ll have this second one finished before midnight.

As Gene crunched numbers hoping he hadn’t forgotten anything, he asked himself, “Why am I doing this? I could go to work for somebody else, make more money and work less hours. This sure isn’t how I pictured it five years ago when I started the company.”

“I had no idea that running my own business would be this hard!”

Gene rubbed his eyes and stretched his back and thought, “I must be doing something wrong. When I was working for John at SMR Construction things looked easy. I wonder what he was doing different.”

It’s Saturday, and Gene has been working like crazy all week long. Between production crews not showing up, materials not being delivered on time, cost overruns and computer issues…projects were behind schedule and the company was losing money. Even if he works tomorrow, he’s going to have to disappoint at least one of the customers waiting on a proposal.

“How am I ever going to turn this around?”

When Gene finishes the proposal and looks at the clock, it’s 12:40. It’s already Sunday and he still needs to proofread it, print it and sign it. Something has got to change! “I’ve been leaving home early and getting home late all week. I haven’t even spoken with my wife for days. I’m calling John on Monday to see how he did things.”

First thing Monday morning Gene called John. After a few minutes of catching up, Gene asked John the question that he couldn’t quit thinking about. “John, I’ve been working day and night trying to keep up. When I worked for you it seemed like you had everything figured out. You weren’t stressed even when things didn’t work out as planned. Your customers understood what to expect with their projects and were happy when they were finished. What am I doing wrong?”

That’s the question that almost every business owner asks themselves.

“Know this,” John said, “When I started my business, I was just like you. I struggled to keep up, worked too many hours, neglected my family, was mad at myself for letting down my customers, my family, and myself. I kept asking myself that same question. What am I doing wrong?”

“By the time you were working for me, I had figured some things out. It’s amazing what you can learn when attending the ‘school of hard knocks’. Keep in mind this is the most common process for learning but isn’t the most effective.”

“What really turned my business around was when I found out about Solution Building’s, Blueprint for Building a Better Business.”

Think about how much easier and better a construction project goes when you have a plan. The same thing is true for a business. A plan gives you direction, keeps everyone involved working together, and improves the odds for a successful outcome.

“Gene, if this is something you would be interested in, I would recommend starting with the, ‘Blueprint for Building a Better Proposal’. This is the most important and most neglected part of construction communication. If you’d like I would be happy to meet with you and go through the process and answer any questions.”

“There’s a lot more to the ‘Blueprint for Building a Better Business’, but starting out, you should focus on the proposal system. After you get this part implemented, we can discuss which part of the business blueprint system would be best for you, next.”

After talking with John, Gene thought, “I’m sure glad I made this call. For the first time in a long time, I feel like there might be a light at the end of the tunnel that isn’t an oncoming train.”

If you struggle trying to keep up with operating a construction business or know someone who does, we are going to be having a free 90-minute workshop for Building a Better Proposal on Saturday, January 6, 2024, at 10:30 CST. Register for the workshop here.

If you have any questions about the workshop or business systems, you can schedule a free 30-minute construction company consultation here.

It’s Important for You to Have the Right Tool for the Job

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And There’s More to the Right Tool Than You Might Think

For those of you that remember the TV sitcom “Home Improvement” you’ll remember Tim ‘the Tool Man’s’ Taylor’s attempts to give “more power” to everything from cars to household appliances and the infamous ‘grunts’ that accompanied this.

Guys love tools. There’s something primal in getting a new tool and learning to use it.

You’ve heard it said, “The way to a man’s heart is through his stomach”. I agree this works pretty well. However, I would argue that an even better way is…give him a new power tool.

There is a tool out there for every job, usually more than one. As cool as they all are, they’re worthless if you don’t have them and don’t use them.

The biggest “tool” problem is…the lack of “business BUILDing tools”.

Most “construction guys” would prefer to use a circular saw or screw gun rather than a computer. Paperwork most likely isn’t what they think of when considering tools.

One of the most important tools in the “construction toolbox” is paperwork.

Profitability and the success of the company hinges on the accuracy and knowledge of income and expenses. It requires having the right tools, knowing how to use them, and then actually doing so. 

Some of the tools needed for BUILDing successful construction businesses are sales tools like construction proposals and contracts. Production tools like change orders and payment applications. Financial tools like job tracking, job profit/loss and savings account transfers.

When I started my construction company, I had no tools for BUILDing a business. Like most construction companies, I just guessed. After looking for business BUILDing tools and not finding what I needed…I developed systems that took the guess work out of running a construction company. I’ve been using and refining these tools for more than 35 years.

You can have these same tools by purchasing the Business BUILDing Toolbox (complete with templates, instructions, and examples of the tools). This way you can stop rolling the dice with your profits and take control of your money and your business.

Too often construction companies see the benefits of having tools and systems for their business but aren’t willing to spend the time or money. They can’t see the value. These same people wouldn’t think twice about spending hundreds or thousands of dollars to buy cordless tool kits or pneumatic nail guns and compressors, not to mention the price of things like skid loaders!

The real question is value…not price.

When considering tools, you should consider the return on your investment. Those power tools that you purchase are going to wear out over time and need to be replaced. The Business BUILDing Tools won’t. You can get the whole toolbox for less than the price of a good quality cordless tool kit and the return on that investment is priceless.

Having the right tools, knowing how to use them, and then actually doing so can be the difference of having a successful company or giving up and going out of business.

You’ve never been afraid of getting a new power tool and learning how to use it. Don’t be afraid of Business BUILDing Tools either.

You can learn more about these tools here or feel free to schedule a free 30-minute construction company consultation.

We are going to be starting a half price Holiday Special on Black Friday (Nov. 24th) with the toolbox price increasing $25 each week through the end of the year. So, be ready to grab your toolbox full of Business BUILDing tools at the sale price before it’s too late. Also, feel free to share this holiday offer with any construction companies that you think could benefit so they can take advantage of the reduced price!

Why Choose Trick over Treat…Isn’t Treat the Better Choice?

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You Would Think So, But Construction Companies Do It All The Time

Halloween is almost here. Most of us have done trick or treating as kids. You know, that tradition where children dress up in costumes and go from house to house asking for treats with the phrase “trick or treat”.

The “treat” is usually some form of candy/sweets, although it might be some other small gift. The “trick” refers to a threat, usually an idle one, to perform mischief on the resident(s) or their property if no treat is given. 

Sure, there’s some cost to buying the candy and it requires some time to answer the door and pass out candy, but given the choice…

As a property owner…a treat seems like the better choice.

If the treat is the better choice, why do construction companies continually insist on tricks?

I’ve written a lot about construction companies being scared to do things differently. They’re stuck in the rut of “we’ve always done it this way”. Trying to build your dream business this way is like being in a horror movie.

Everything is predictable. Rather than doing something different, they hide in the basement, the attic or behind the chainsaws, when they could just get in the running car.

Hiding behind chainsaws is what most construction companies do. They choose the discomfort of the known trick, over the uncertain treat.

I don’t think these companies started out hoping to have unhappy customers, or not have enough money to pay the bills, or to be working 70-80 hours a week for minimum wage.

The reason most construction businesses are stuck here is fear. They are afraid that trying something different might not work. They choose the discomfort of the known over the unknown.

It doesn’t have to be this way!

This is why over 30 years ago I decided that I wasn’t going to hide behind the chainsaws anymore and I got in the running car (okay, really it was truck).

Did everything I try work…no. Was it scary…yes. But I didn’t stop, I kept trying until it did. Then I worked on it some more to make it better. And then I started working on a new and different business tool or system.

This is where I figured out the 5-step business BUILDing process. I BECAME AWARE that what I was doing wasn’t working. Then as I researched, I began to UNDERSTAND the problems. Next, I compiled INFORMATION about what was needed and began IMPLEMENTING new tools and systems into my business. The more I used these tools, the more I LEARNED and the easier it became. This process led to BUILDing my DREAM business.

The great thing is, YOU don’t have to go through the long, hard, and scary process to build your dream construction business by yourself.

You can get the tools and systems that we use by going to the Business BUILDing Toolbox and get started quicker, and it’s less scary. If you would like to learn more about these tools and systems, check out the 5-step Business BUILDING Process. To learn more about how these business tools and systems can help you build your dream business, schedule a free 30-minute consultation.

Set yourself apart from your competition by choosing the treat over the trick.

Why is it so Hard for Construction Companies to Stay in Business?

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It’s Really Not That Hard…It Just Requires a Change of Perspective

It’s crazy the number of business that start and fail. Millions of businesses get started each year, but only a small portion survive. Why is it that 90% of all businesses fail? An article by Luisa Zhou is full of research-backed business failure statistics.

  • 18.4% fail within the first year
  • 49.7% fail within the first 5 years
  • 65.6% fail within the first 10 years
  • Only 25% make it beyond 15 years

There are countless reasons that businesses fail, but just because other businesses fail, doesn’t mean yours will too. Being aware of and understanding these statistics increases your chance of survival.

You can’t succeed if you don’t try.

If your dream is to own a successful construction business, you need to do your homework and then commit to it. Construction businesses do have a high failure rate, but that’s not to say you should avoid the construction business.

It just means you need to be aware and get prepared.

Listed below are five small business types with notoriously high failure rates.

  1. Restaurants – Independent restaurants have a failure rate of over 60% at the 10-year mark. The key to success is the ability to raise capital when needed. If a business owner cannot do that, there’s not much left but to close the doors.
  • Retail stores – Another business with intense competition is retail stores. Not only do you have to contend with other brick-and-mortar stores, but you also have online businesses undercutting your prices. Like independently owned restaurants, retail stores have a failure rate of over 60% at the 10-year mark.
  • Direct sales – Yes, it’s your own business, but if a friend asks you to become part of a multi-level marketing (MLM) business, say no. What you’ll hear are success stories. You won’t hear that, like a pyramid scheme, 99% of direct sales reps suffer significant financial loss. It’s the people at the top and the person who recruits you who makes money. 
  • Construction – Starting your own construction business is a tough gig. Construction businesses also have a failure rate north of 60% at the 10-year mark.

Not only do you have to be good at your craft, but you have to become a full-time salesperson, accountant, administrator, bookkeeper, and part-time counselor.

If you have a passion for building and offering unique touches that buyers can’t get from another builder, you’re off to a good start. The thing that’s usually missing is a business plan and the right business tools.

  • Insurance sales – Insurance agents face the same challenges of construction…wearing too many hats. They must be a master of administrative work, sales, and an ever-changing insurance scene.

If you’ve been in construction for any length of time, or know someone who has, you’ve become aware of how hard it can be to operate a successful construction company. Understanding the things that are needed to achieve this is one of the BUILDing blocks in a solid business foundation.

NOW WHAT? Now you need to change your perspective.

Perspective is a particular way of looking at something. This doesn’t mean it’s right or the only way. It just means that it’s our perspective.

Rather than assuming you’re the only one in construction dealing with issues you need to understand that this is not the case. These struggles are common across the construction industry. But changing your perspective is just the beginning.

Real change requires action. You’re going to have to do something.

So, what is the something that you need to do?

You need to lay the next block to BUILD the foundation of your business. This block is INFORMATION, INSTRUCTION, and IMPLEMENTATION. This is the third block in our 5-step Business BUILDing Process. Check back next week, and we’ll take a hammer to this building block to see what it’s made of.

It can be really frustrating trying to figure out how to build a successful construction business. But you don’t have to do it by yourself.

After owning and operating a construction business for more than forty years, I’ve developed business tools and systems that we are now making available to construction companies to give you an advantage over the competition.

If you would like to learn more about BUILDing a successful construction business, you can schedule a free 30-minute consultation here.

What is it About TOOLS That Building Contractors Love So Much?

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Wielding a Power Tool Gives Us a Sense of Control and Respect

Last week we discussed how to build the construction company of your dreams with a plan and the right tools. We talked about how scary it is to step out of your comfort zone and try something new. We also discussed how this plodding back and forth can get us stuck in a rut.

You need some powerful business building tools to help you get out of your rut.

The feeling of that power in our hands is amazing. We are in control, but the machine can never be tamed. We have to respect it, or we will regret it. We pretend to be in charge of the “power tool beast”, but we know better.

Power and control –

  • Power tools have the power to create. When the power tools come out, we have no idea what is about to happen. Every time we connect with that much electricity, a child-like excitement oozes from our pores.
  • Power tools have an untamed spirit that screams: “Anything can happen.” Turning on a generator makes you feel like you are The Generator. For a few minutes, you’re off the grid and in-charge. You have the power and can decide who you will bestow it upon.
  • Power tools let us pretend that we can do anything. Don’t fool yourself, your power tool is in charge! Just look at the sticker on your SAWZALL: “Warning this device is powerful and is capable of doing serious harm to your home, your person, or your entire way of life.

Meditate on the raw power, the Amps and the Volts. Be in awe and imagine where your power tools may take you.

This fascination with tools is very similar to the reason most guys would take almost any ridiculous “man challenge” for the promise of a gold sticker on their forehead and “buddy cred”.

“Hey, I bet you can’t crush that can with your head!” Sound familiar?

Hopefully, most of us are smarter than this.

As builders we love the rush we get from building something. That sense of accomplishment that comes from creating a dream home out of that stack of boards. Tools give us the power and control to do this.

A tool that is even more powerful than the biggest, meanest chop saw is the Blueprint for Building a Better Proposal.

I know it doesn’t make as much noise or make your arm numb after using it all afternoon, but it’s a tool that will allow you to build your business into a skyscraper of success.

The hardest thing you will ever build is a business. The tools used for this kind of building are different than what we normally think of when thinking tools.

During my forty plus years of building my business, I’ve continually worked to achieve and maintain a sense of control over my profit and build the successful company of my dreams.

Just like any other building project, it’s important to have tools and know which ones to use in specific applications. You wouldn’t use a cordless screw gun to saw a board, or a reciprocating saw to nail down a shingle.

You can saw a board with a hand saw or you can use a circular saw. We both know which is faster, easier, and makes more sense.

The same thing is true when building a business…you need to have the right tools.

Why is it that we builders are so stubborn when it comes to trying something new and different. Business building power tools sound too good to be true.

You can use the old school “guesstimation” method or you could use the new and improved Building a Better Proposal power tool.

It’s important to have the right tools for the job.

Maybe you uncover some termite damage, or your customer decides after the project has started that they would like to do some additional work.

These kinds of things happen on construction projects quite often. This presents you with the option of moving forward without giving your customer a price or preparing a change order.

I know it’s another one of those uncomfortable “get out of the rut” kind of situations.

What if there was a power tool for preparing a change order…oh that’s right, there is! It’s called Building a Better Change Order.

These are just two of the power tools that will be available for you in the digital Business BUILDing Toolbox. We plan to have these tools and more available later this month.

If you or someone you know would like to feel the power of a tool that provides control for building a successful construction business, while respecting that power without regret…stay tuned for updates on when we open the lid on the Business BUILDing Toolbox.

If you have questions about how these business building power tools could help you build the business of your dreams, you can schedule a free 30-minute consultation here.

Having a Plan for Building Something isn’t Any Good if You Don’t Use it

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The Bible is a Blueprint for Building Our Best Life

We live in a world of idea bombardment, and it’s hard to sort through it all to know what is real. We see things on the news, social media, the internet, and TV programs. We hear things from our family, friends, neighbors, and community. So many different opinions.

The world thrives on conflict.

How can we determine what is real and what’s not, what’s right and what’s wrong? This is a subjective question that can be hard to answer. Who do you believe and why?

Just like building a structure can be done in a variety of different ways…so can your life. Ultimately some things work, and some things don’t. A house without a roof is going to get wet inside when it rains. A house without a foundation is not going to stay standing when the ground erodes.

A house built on a solid foundation will weather the storm.

Back to the question of how can we know how to build our best lives? Just like building a good building, we need a plan…a blueprint. Just like how a building project doesn’t go well when the blueprint is ignored, so it is with our lives and ignoring the Bible.

The Bible is our blueprint for building our best life.

Using a blueprint requires some work. Just because you have a blueprint in your office doesn’t mean it’s going to help you if you don’t get it out and use it. This doesn’t mean that unrolling it and flipping through the pages is enough…it’s not. You need to study it, learn it, and implement it or the building will not turn out well.

The same is true for life. If we don’t get the Bible off the shelf and study it, learn it, and implement it, our lives won’t turn out well.

A good builder doesn’t just look at the blueprint once and then put it away. There are questions and problems that come up constantly throughout the project. He uses it every day until the project is finished. The more he studies it, the more he knows about what is expected.

We should use the Bible in the same way. We should study it daily so that we know what is expected.

Another problem that can happen with blueprints is when a builder doesn’t fully understand or misinterprets the blueprint. Just looking at the foundation plan doesn’t tell us about the roof. Just looking at one page of the print will lead to mistakes in the construction as well as subcontractors being led to do the wrong things. This is why it’s important to ask questions and discuss it with the architect and other builders.

This happens with the Bible as well. We can’t just pick and choose a verse here or there and not know the whole plan.

You need to take the whole Bible into account so that you don’t make a mistake when building or lead others to.

Blueprints let us see what the architect expects from the builder. He shares all the different aspects of a building and how they should fit together. A builder who has built buildings before can begin to think he knows how to build and doesn’t need a blueprint. Inevitably this is when mistakes happen and can be very costly.

God is the architect of our lives and when we begin to think we know more than Him problems are sure to happen.

A builder must decide if he’s going to trust the architect’s plans or not. He can ignore them and build the building however he wants. The problem is…the building doesn’t belong to him, and if it’s built wrong, he won’t get paid.

The same is true for us. We have free will, and we can live our lives however we want.

The problem is, in the end, the payment we receive will be what we earned.

Use the Bible as your life blueprint. Get it off the shelf, study it, learn it, ask questions, and build your best life.

This past Sunday, Jim Miller shared the message to “Just Tell Them the Truth”. Here is a list of Scriptures that he used throughout his message.

  • Matthew 6:33
  • 2 Corinthians 11:2-3
  • Ephesians 4: 14-15
  • Colossians 2:8
  • 2 Timothy 4:1-4
  • Hebrews 2:1
  • Revelation 2:4-5
  • Revelation 3:3
  • Romans 3:23
  • Romans 6:23
  • Romans 5:8
  • Romans 10:13
  • Romans 10:9
  • Romans 12:1-2