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Thursday, December 06, 2007

Getting started -- it can be hard

Today, on the Construction Management Network, Canadian contractor Chris Lowes posed a provocative question:

I joined this group a little while back but haven't a chance to introduce myself, so here goes.

I have over 20 years experience in ICI construction sector. As Matt Stevens says in his book Managing a Construction Firm on Just 24 Hours a Day I'm a "mud on your boots Guy". I worked my way up through the ranks starting as a Carpenter Apprentice to a Site Superintendent with a little Project Management in there as well. I'm a strong believer in continued improvement and in the course of my continued improvement I achieved my Professional Gold Seal Certified status by the Canadian Construction Association.

Having gotten to this stage in my life I decided to go out on my own and have started my own Commercial Construction company. I have plenty of field experience, but lack the business experience of running a construction company. I have worked hard to earn an excellent reputation among the sub-contractors and know once the business takes off I will earn the same reputation with my customers. Here is my problem (that I hope this group can help me with)most of those 20 years experience I spoke of was with a large union general contractor -- their customer base is quite different then mine. The contacts I earned through them are mostly among the trades. I'm finding it difficult to start as people want to see a track record for your company, not just your own.

Should I just remain patient and work through my start up? Or is there another avenue I should pursue? What I'm offering to the market is a professionally run project that comes with my commercial credentials and the total commitment to a project that comes from a small contractor.

I responded with some suggestions -- turns out I had met him at the Construct Canada trade show last week and provided him a referral to someone relevant for his business. But this answer from another network member, who provided his real email address but didn't identify himself directly, speaks closer to the heart of real experience.


Great question. I too am recently out on my own and facing much the same dilemma. With several partners I formed a GC firm in 2004. By default of personality it fell on me to become the chief evangelist for that new venture. Like you, I had always built projects for whatever firm I worked, but I never had to figure out how to find that work. I spent two years trying to "invent" myself as a salesman and trying to sell a company that had almost no resume. Once we had some good momentum our financial partner pulled all his money at once and left us high and dry. I left with one of the partners and we struck out again.

So here I am for the second time in three years trying to sell a start up construction company.

Here's what I've learned along the way.

1. The sales cycle is long, be patient. We go to bid next week on a$1.5M project that I've been chasing 18 months.

2. While you work toward the better stuff, consider keeping your business model flexible enough to do other things. We're doing lease renewal carpet and repaint projects for a property company right now to make ends meet.

3. Work all your professional and personal contacts mercilessly. There's no shame in calling everyone who'll answer your phone call and asking them if they know of any work you can do. Just get something going. Even if you have to paint an office, the photo will look good in your brochure and make a little money along the way.

4. Join a couple of good professional groups and network. and are sites you can look at to get an idea (of) what I mean. Figure out where your client base might be and go do the "grips and grins". And get involved in that group more than just a morning coffee meeting once a month. Get on the golf committee or the government affairs committee or something like that. People need to know who you are.

5. I learned this one the hard way. If you are going to be a construction company owner, you have to be a marketing and sales juggernaut. As soon as you get distracted by managing the work you are no longer finding the next project. By the time you realize you're about to be out of work, it's already too late. Remember #1above. My rule of thumb is that generally the sales work I'm doing today is 12 months out from making me any money. While your men are out doing work today and thinking about the coming Christmas holiday, you need to be thinking about December 2008 and beyond!

Good luck and hang in there. It's tough but it beats punching the clock for "the man".

These suggestions count a whole lot more than anything I could offer -- the person who wrote this response is experiencing, first hand, the realities and challenges most new and start-up businesses encounter. It is hard work, indeed, but ultimately truly rewarding.

1 comment:

Construction Marketing Ideas said...

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