Tag Archives: Construction Business

Hurdles one faces while setting up a construction company

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Starting up any new business is a tough task. It becomes tougher for the ones who do not have much or any experience in handling the business thus making the entire process extremely painful. In addition to this, it become arduous to keep the present business running as there are chances of facing severe ups and downs in every phase and leap that you take. Like any other business, setting up of a construction company is filled with risk and hard work. You also need to be foresighted and got to assume things appropriately so that if you see a threat you can counter it in advance.

Hurdles are plenty in the construction industry. However, it also gives you a ray of hope which is more than enough to sustain in a dynamic industry like this. So the crux of the matter is how well you can adapt to the ever changing phenomena of this industry and how quickly you can recognize the internal as well as the external threats that may destroy your dream of owning a construction business.

Legal concerns:-

While setting up a company, there are a lot of legal formalities that one needs to complete without which it will not be possible to run a business in US. These legal formalities can be lengthy at times and therefore you need to know the right way to get your work done at the shortest possible time. You might want to take help of an attorney who will guide you with every step and get things done for you. Getting sanctions from the government may not be a huge hurdle but it definitely takes some time of yours to get you started.

Setting up an office and a small team:-

Once you have received the sanctions, the next step will be to set up an office and also have a small team in place. You got to hunt down for a place that you can use it as an office and also recruit few men who have worked in the construction industry. If you have little experience in this domain, you will be able to pick the right guys but if you are a newbie then things might get really complicated.

Buying heavy equipment:-

In order to get a small project, you need to have a couple of heavy equipment. Now you have the choice of either buying them or taking it on rent. If you plan to buy them you have to shell out good chunk of money but if you take it on rent you need to ensure that you have sufficient reserves every month to pay the rental amount. Other than this, buying the right machine is always a challenge especially if you are going for second hand ones.

Running the office:-

You got to pay salary to your team and also meet the office expenses that will recur month after month. This means that you got to have ample reserves in hand. It is to be noted that you do not get a project the next day you set up your office. It takes lot of time to get some small work. So maintain your business becomes a big hurdle.

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Importance of backhoe loader in the construction business

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We all know the importance of heavy equipment in the construction sector and to what degree it can help the construction workers to ease their work but there are some heavy equipment that are by large considered as the most efficient and most preferred by all construction companies. Heavy equipment like dozers, scrapers, rollers etc. all have a specific role to play but there are some that can be used for multi-purpose activity. Heavy equipment like excavators and backhoe loaders are machines that have the capability to perform activities for which you require another set of heavy machines. So you need not buy any other set of machine and can only depend on these heavy equipment to do most of your work. All you need to do is change the attachment as per your needs and it should be able to take it from there.

A backhoe loader is one such heavy equipment that can do 2 things at one time. It can use the backhoe to dig the dirt from the ground and with the help of the loader it can gather all the dirt and load them on the truck. So this means that the construction house does not need to deploy 2 different machines to do this activity. Backhoe loaders in general are quite powerful, efficient and completely reliable. Not just for constructing big buildings but also for constructing roads, these powerful machines make a huge difference. It has the potential to work on rough terrains and does not give a nightmare to the operator when he gets to know that he has to work on a mountain slope or a muddy piece of land.

The cabin for the operator working inside the backhoe is spacious enough to accommodate him and few of his belongings easily. It also has good leg space allowing the operator to stretch his legs after working for long hours. The most important part of this machine is its engine which is super tough. However, the quality also depends from companies to companies and therefore someone who buys the loader from a reputed brand will always find his money worth the machine. It is also much preferred heavy equipment with most of the mining companies. With the help of the backhoe it can easily break down the toughest rock and the loader can then carry it all. This gives it an edge over all other heavy equipment in its class.

The operator of a backhoe loader should be pretty experienced with having worked with such machines in the past. They may then know how to maneuver the machine with ease. A newbie might find it a bit difficult and may need guidance to deal with it. It is crucial for the operator to know the gears well as it is also used during the digging process. So the person working on it should be aware of the gears and understand its significance. Overall, it is a machine that most of the small construction companies look forward to as it helps them to fulfill dual activity by just switching over the attachments.

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Making of a mighty construction company

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Construction is a lucrative business. Although many entrepreneurs start this business as, yet it is only 10% who make it very big in terms business to become brand names. These construction companies do not achieve success overnight but they have done diligent business planning to become ‘Mighty’ in this field. Experts have observed some common traits among these super achievers as:

  1. Clear aims and objectives: They know what they want to achieve and have noted it down and hold onto that vision. They are aware of their mission, vision and values. This allows them to maximize resources of time, energy to achieve big monetary returns in future.
  2. Planning: Construction involves a lot of work and it has to be done with a responsibility. They understand the importance of planning, systems, and processes need to be place in business. They plan their work to perform it systematically and they also work according to their plans to be successful.
  3. Updated: They are aware about the market trends in construction and try to adjust themselves as per the situation. They also spend time with people who will support their ideas and from whom they can get suggestions. They participate in healthy discussions to be successful in their ventures.
  4. Well-qualified professionals: They hire excellent staff and managers for smooth and effective functioning of organization. They pay them well, train them in latest technologies and give them good work-life balance. They also hire the right type of people who will perform their work very dedication. They know that hiring of cheap labour will lead to mediocrity and work will suffer and will lead to loss in the future.
  5. Designing Effective Business Strategy: In order to win over rivals in business, they have make appropriate preparations and checklists. They always provide excellent and superior quality service. Further, they know strengths and weakness of their employees. Employees are informed about their weakness and are suggested to be improved.
  6. Defensive business strategy: The costs cover the equipment, vehicle, labor, registration or business licensing, surety bond, and insurance requires a lot of finance. They do not depend on loans abut have saved enough which ensures that this excess money will help them in difficult times.
  7. Effective sales and marketing: Just providing good services is not enough, as its awareness has to be created. Hence, they hire good sales people. In addition, they also get onto social media such as Facebook, Twitter, and sending text messages to get into business leads.
  8. Business Transactions: While performing different transactions, they are diligent and vigilant. They do not sign on any papers to avoid getting them into trouble.
  9. Customer satisfaction: Since they value their customers, they listen to them, reply to their queries and concerns about product. They try to modify or improve their services to please the customers. This increases their customer base. They value professionalism and empathy which makes them customer loyal and successful in business.

Overall while making a mighty construction business they are aware that is a multidimensional business which requires a lot of planning and detailing to ensure success.

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5 ways to acquire a strong construction team

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The success of any organization is highly dependent on the kind of sync the team member have amongst each other. If the members of the team are cordial and understands each other well then they make the ambience lively and full of energy. This quality is required in every important industry and especially in companies that are aggressive and are looking at every opportunity to grow. If the team performs well, it shows in the progress matrix of the company and the company should also make it a point to reward such teams by giving them gift cards or taking the entire team for a party or on outing all at the expense of the company. Now this definitely boosts the morale of the team and they have more reasons to perform splendidly that before. A strong team can define the future of the company and plays an important role to achieve the goals set by the company.

A construction company has to go through a number to challenges that it gets from the outside. All it needs in such a situation is some support from its team so that they can face the challenges as a team and can get over it with minimum effort. However, a strong team is not formed overnight. There are lots of efforts taken by the management of the construction company and to a larger extent by the owner himself to ensure that he has a strong team that he can rely on during difficult times.

Leadership quality:-

A strong team is formed when you have a strong leader at the center and the team respects him and follows his command out of reverence and not out of fear. The boss should not act like a grumpy old man who can get angry on any silly thing. People usually do not like men who lose their cool in no time. One of the important characteristic of a leader is he/she give more of his time to listen to people and speaks less but when he/she speaks, he/she makes sense and talks to get rid of the core issue.

Have faith in your team:-

If you want to have a strong team then you should first learn to have complete faith on your team. You should have the confidence that the team has the capability to pursue and complete an assignment given to them. This faith of yours will help them to do better in their work.

Problem solver:-

If you are a person who can solve the problems in your team the chances are more that the team will develop strong with every passing day. They may have few hiccups during the course of their project and it becomes your responsibility to ensure that those hurdles are put away.

Offer more support to weak members:-

We are often of the opinion that a weak member in a team can bring down the overall performance of the team and therefore he/she should be chucked out. However, that is a wrong practice and will never lead to a strong team. One should offer more support to a weak member and try to bring him at par.

Monetary incentive:-

Giving monetary incentive can improve the overall performance of a team. They will work harder to meet the targets and ensure that they sit for extra hours to earn the incentive.

Heavy equipment salesman should have little understanding of the construction business

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A salesman selling a particular product should have little understanding about its utility and how it can be useful to the end user. He needs to do a study on the effectiveness of the product in the life of the consumers and once he does that selling the product will become quite simple for him. Though selling anything is a difficult business but as long as you understand the intricacies of a business and the efficacy of your product in that business you will be able to pitch it in the right way. Salesman who gives more attention knowing the product often end up getting frustrated because they probably know everything about the product they are selling but not much about its use to the ultimate user. This is perhaps not the right sign to start selling a commodity.

Salesmen who are into selling heavy equipment should keep in mind the need of the customer first and why they will want to buy the stuff they are selling. This is where the importance of knowing the construction business comes into picture. As long as you do not know the purpose for him to buy the machine you will be unable to pitch it correctly. You will then try to brag about the feature of the machine but little you know if that machine is at all needed by him in his business. You lose a client in this fashion and perhaps someone else who has a better knowledge about the industry will be able to sell it to him. You may only be left to wonder what went wrong with your approach and what the other salesman did to bag the sale.

You can learn about the construction business in the trainings that are held by your companies. They will speak about the business in particular and also which type of heavy equipment is required for what kind of job. Also you can pitch in products like bucket, attachments and other accessories. So it is not always that you have to sell the entire heavy equipment. Some construction business owners need to just upgrade their machine. Now you can’t ask them to get rid of the old one and buy a new one which has the upgraded feature. He will never want to do that and it will also not be a good salesmanship on your part.

What you can do is have a hearty talk with your client. Try to figure out his actual requirement and where you fit in. it is only after that that you can pitch a product to him. Please remember that if you sell the stuff that benefits the consumer he will more likely give you more business but if you sell him items that gives you good commission then you may sold him the machine for the last time. Never indulge in such mistakes. Short term gains should never be your goal and always pitch in products that are beneficial for the client.

Construction business needs good leaders

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We all have the fear of failure that often pulls us down and stops us from thinking big or doing something big in life. However, there are few who believe themselves more than anything else and their belief tells them that there is nothing that can stop them. No failure can be big enough to stop him from pursuing his dreams. These kinds of men eventually become leaders in their profession. Leaders are often men with a vision in their lives. They can foresee what others can’t and often has the capability to identify the hidden potential in a human. This capability of theirs can take them to greater heights as they can have all the capable men working for him and in this process he can be prove to be an exceptional business owner or an individual. The construction business like any other business is short of leaders. It needs people who not only possess self-belief but can also motivate others and help them identify their potential.

Leaders should command respect:-

Men who can command respect can eventually turn out into strong leaders. For a leader, his men mean a lot and for the men the leader should mean a lot. The relevance a strong leader can have in the construction business is he/she can ask people to work extra when they are working on strict deadlines. Construction workers normally do not work like to work extra as they normally do not have any energy left after a long days’ work. But if a person whom they look upon asks them to work for a couple of hours more they may not want to say no to him/her. This is what respect is all about. The workers will agree to work merely out of respect and nothing else can bind them to continue working after their working hours.

Have complete faith on your employee’s potential:-

A good leader is the one who has complete potential on his men. In the construction sector, you will come across many men who will be allotted for different work. It is up to the leader to bring the best out of them. He/she needs to understand and detect their hidden potential and give the guys the courage to do something phenomenal. We normally live in a shell and as long as someone realizes us about our strengths we make our own comfort zone in the shell and continue to live in it. This is where the role of a leader comes into play. He/she has to make his/her men or women realize their hidden potential and what they can do in their lives. This will mean a lot to them and they will strive harder to accomplish their goals.

Be a good listener:-

A good leader is the one who is a good listener and not just a good speaker. You can speak on an issue when you know what the problem is and for that you need to listen to people. Always be open to listen to others so that they can talk their heart out to you and you in turn can bring some kind of solution to them.

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Knowledge transfer is a must in the construction domain

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Keeping your experience with you and not sharing it with anybody does not make sense in any form of industry. When you learn something new, you should let others know about it and this is how others will get to know about your experience and derive a conclusion from it. Your experience must be a good one or a bad one but it always has a message for the people who hear it. This is one of the way by which you transfer your knowledge to the people around you and help them learn through your experience. You be a part of whatever industry, you learn most of the things from the experiences of others. Our lives are too short to experience everything and therefore we hear out stories of others and take lessons from it. This phenomenon is known as transfer of knowledge.

Knowledge transfer is a must in every industry and especially when it comes to the construction sector, it becomes all the more important. The reason why we consider knowledge transfer to be so important in the construction domain is because this industry is quite vast and it is virtually not possible for anybody to work in all the spheres and learn everything from it. You need men who specialize in one particular stream to inform you about how things function in his line of business.

For instance, a welder can at times know more about a machine than an operator who has been constantly working on it. It is because the welder or the mechanic for that matter fixes the machine whenever it breaks down and thus can inform the operator of some specific issues with the machine and ask him to be cautious while operating it. This is also one form of knowledge transfer where the mechanic is transferring the knowledge about the machine to the next person so that the equipment will be dealt in the right manner.

In a nutshell, the entire construction site primarily works on knowledge transfer. Here the site engineer needs to pass on the information to the next guy who will arrange for the things the engineer has asked for and once it is there in place, it will move to the next person with the specific instruction on what he needs to do. When we have new recruits joining the company, the importance of knowledge transfer is felt the most. The new guys do not know anything about how things work in the company and they need to be informed about every minute activity. So the message passes from the veterans to the newbie.

Another form of knowledge transfer is through articles and blogs. In this scenario, the writer who is pretty experienced and an expert on the subject writes about heavy equipment and gives an insight to the people at large. It indeed helps people to take informed decisions about their heavy equipment. Internet is a powerful tool and its use to transfer knowledge across various domains in widely appreciated by everybody.

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Set up business models that can be achieved

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Construction business may seem to be a rewarding one but in order to set your foot strong in this business; one has to go through enormous planning and determination to execute them with precision. Firstly it is very important for them to establish a sound business plan and once that is in place follow the plan stringently so that you can achieve things in a phased manner. Now having a construction company, you have entered a dynamic industry which has no set rules of its own. Things that are found to be merrier now may turn into something drastic and therefore just having one set of plan with no flexibility can only harm your growth prospect. Therefore it is crucial that you analyze things, try to foresee them and be ready to revamp your strategy when the need arises or else you may find yourself in an unwanted and complicated zone.

Take baby steps in the beginning:-

If you have just started your construction company, avoid taking big leaps as there are chances that you may hurt yourself in this process. Dreaming big is not a problem but giving not much time to fulfill those dreams could be harmful and dangerous for the prospect of your company. So during the initial phase, you take small steps towards achieving your goals and once you start seeing things working out for you, you may then speed it up a bit. However, do not be in a hurry. Have patience and give some time for your business to grow. It takes a lot of time to form a concrete construction company. During this while you should enjoy your work and learn from it.

Your strategies should be realistic:-

When you are setting up strategies for your company, make sure that they are realistic and achievable. Strategies should always be formed keeping into consideration your business goals and the time by which you want them to be fulfilled. Keeping unrealistic goals can have drastic impact on the financial health of the company as well as on the morale of the employees. It is prudent that you consider all the facts well before you frame business plans.

Review your plans at regular intervals:-

Plans once framed should be reviewed at regular intervals. You should give a gap of 3 or 6 months and then review the ground figure. Take into account all the people from the senior management and review your plans with them. Give clear instructions on how you want the review to be. Reviews that are simple can be better understood by everyone. If you find one particular department not being able to perform up to its merit, you go to handle the situation delicately rather than exerting pressure on the team. First and foremost, try to evaluate the reason of underperformance and once you have earthed that check if they need any help from you to get it fixed. You should be ready to provide any assistance to improve your team’s performance. Once these things are taken care of, rest all will fall in place.

Keep yourself open to suggestions, it will help you grow

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While starting any new project, the company or any organization generally holds discussion to obtain views of its professionals and managers before it is executed. The senior management give suggestions to modify or improve the project in order to make it successful. Suggestions are always important so that the projects/tasks get executed in a planned manner and yield benefits. It is type of ‘caution’ taken before taking a major decision..

 

While embarking on any major task/project a person has to think analytically and plan well to execute it properly. A person can do it all on his own and many times suffer from failures. This is due to the ego and rigidity of one’s ideas leads to short-sightedness which fail to see the shortcomings in a project leading to failures. In case of failures of large projects, it causes permanent destruction of that organization.

 

In order to avoid this difficult situation, it is good if a person (or a company) takes suggestions for a project or task from trusted colleagues, mentors, seniors or hire a consultant. They may guide in proceeding of the project by giving their suggestions:

  1. Check if the aim and objectives of a project are clear. If they are not clear then will suggest how modify the aims so that the objectives are achieved
  2. Check for the loopholes/shortcomings of a project and suggest how to overcome them.
  3. May indicate whether the project is feasible or not. If not feasible then suggest to not go ahead
  4. May indicate about the investment to be done and if it is possible. If it is a huge investment and difficult to manage then suggest for decreasing the size of project.
  5. May show the underlying problems of a project and suggest desirable changes to be made to face or overcome those problems.
  6. May indicate the chances of success and failures of a project. To avoid failures some alternatives may be suggested.
  7. They may give strategies for proper planning and execution of projects/tasks

 

Many a time suggestions are not taken seriously due to ego problems. The person may not be confident that the suggestions will help and may yield any benefits. Although this being a case in 90% cases taking suggestions from experienced people has proved beneficial for the project work and made it successful. This ultimately has boosted one’s self confidence to perform better for the next projects. Further it leads to personal and professional growth of an individual.

 

 

Looking out for funds – Hunt for big investors

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If you venture out to do something big you also have to be ready with enough capital to fulfill the monetary needs of the project and in case you do not have enough money with you then the next thing will be to look out for investors who can help you get the money till you are done with the project. Any type of industry requires funding for the inception as well as the completion of the project and it has been generally observed that people who have the idea and the dedication to complete an unique task does not have sufficient money to fund the technological requirements and hence they have to depend upon people who are ready to fund them money and in return they share huge profits or have a bigger stake in the project. So there are investors for everything that you can think of and also for things that you are beyond your imagination but can be brought into existence by some intelligent brains.

Construction companies per say are always in hunt of investors. Be it constructing a hotel or building a bridge or a residential apartment they need investors who are ready to fund their project. In some countries, construction companies do not enter into a project without the consent of their investors. They do not bother to think about how beneficial it will be for the growth of the company but are more concerned about how much profit will the project be able to generate for the investors and accordingly they give their nod once they get a kind of acceptance from their investors. They may not be a normal practice but is increasingly followed by many construction companies.

The big question is how to hunt down a big investor and why will he invest his money into your project. Well the answer is simple. They only invest their money where they see scope of getting high returns in a comparatively shorter time span. So when you get hold of someone whom you know to be an investor and has been funding projects, you got to be pretty sure about your project and what return it will generate for him. Not all investor wants only money out of a project. There are few who are really interested in the type of project that they will be investing their money. So if it is something that goes in sync with conservation of nature and will generate money few years down the line, getting investors for such project is not like having a dream come true. However, finding such men is a bit difficult.

But if you are there to construct a hotel or a bar and you need investments, you will find men willing to fund you. The only clause is the project should be a big one and they should see substantial amount of profit in it. Giving an ad on a website that helps construction companies to find investors will be the right thing to do. You can also check with guys in your business circle and may come up with someone who will be ready to fund your work.

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