It’s feast or famine, right?
In construction, we seem to either have too much work or not enough. If you own a construction business then you know the rollercoaster ride all too well.
It doesn’t have to be this way though. There are some simple ways to smooth out the workload so you can live a better, less stressful life.
Wouldn’t it be nice to have a steady stream of projects that is predictable and doesn’t make you overwhelmed with too much or not enough work?
In this blog post, we’ll discuss the tips and tricks that I’ve learned over the past 20 years building a successful construction business.
How to smooth out the workload.
When people ask me if we are busy, I have a standard answer “always!”. I explain that I’m either busy performing work or I’m busy getting work. Either way, my level of busyness is fairly consistent. Over the years, I’ve learned some tricks that have allowed our company to survive some very difficult times including the great recession, regional market changes, labor shortages and most recently the pandemic.
There are both strategic and tactical approaches to approaching this challenge. Let’s first look at the big picture and talk strategy.
Tip 1: Defining your ideal construction project (ICP)
Knowing what type of projects you are wanting to do the most is very important. What is your company great at doing? Large jobs? Small jobs? Service work? Commercial work? Residential work? Projects less than one hour away?
For example, if you are an electrical contractor that is great at whole house residential projects but you struggle to do the smaller service projects or commercial work, that is good to know. If you specialize in commercial doors but you are less comfortable with residential doors or you like projects that are located within 60 miles of your shop, that should be defined.
Use this list to help you define your ideal construction project (ICP)
My best projects are ones that have the following characteristics:
Location: _________________________________________________
Type of work: ______________________________________________
Size of project: ______________________________________________
Type of client: ______________________________________________
Duration of project: __________________________________________
Now that you have a better understanding of what you are looking for, you can use this ICP definition to help you when your workload is maxed out and you need to modulate it downward. This will also help you when looking for more work. You can put more energy into finding projects that match your ICP and less into finding random projects that don’t fit your strengths.
Currently the construction industry is booming and work is out there. This is not always the case for anyone that has been around for a while. When things slow down you need to have a strategy to get more work. Use the ICP definition to know what types of clients you need more of and then find out how to market to them. It could be as simple as going to your past ICP clients and asking for referrals.
Tips for when you have too much work
If you’re like me, you worry about saying “No” and then having slow periods where you wish you had that project. Opportunities to make money can be addicting. It can feel like you need to make as much money now while things are busy to make up for when things are slow. I agree but too much is too much. If your projects are suffering from lack of labor or you simply can’t manage them all and they start to make your company look bad, then you are doing more harm than good.
So, how do we smooth out the workload roller coaster?
Tip 2: Say “No” to non ideal construction projects (NON-ICP)
When you are bursting at the seams with projects, you need to look at your ICP and either postpone or decline projects that don’t fit. Saying “No” to a NON-ICP is not easy but it will feel great once you do….and you will benefit from it. You will have more time to focus on the projects you have and maintain your quality standards.
In our business, we have so many ICP’s that we are not doing any small projects unless it’s to help an existing client. When we slow down, we’ll start doing smaller projects again to help maintain a steady workload.
Tip 3: Create a waitlist
Depending on the type of project, you may be able to say “Later” instead of “No”. For example, if you do restroom remodels, you can tell your client that you can do it but not until other projects finish. You can also say “I have a waitlist and I would be happy to put you on it and call you when I have capacity”. This is a way to create a backlog of projects to help you smooth out the workload. Clients that value quality will wait for a good contractor. You can even ask them to “sign-up” with you to hold their spot on the waitlist. This creates more commitment and locks in the work.
Tips for keeping your company busy
Tip 4: Use a project timeline to plan workloads
Having a master list of all current and upcoming projects is essential. Now, you need to know the approximate start and end dates for each project. It could be a guess but that’s ok because this should be reviewed and updated on a regular basis. We update ours weekly but you may find that it should be done more frequently or less depending on the length of your projects.
Once you have your timeline, it helps you determine where you have gaps. It will allow you to make better decisions on which projects to go after based on your capacity.
Here is a sample project list:
Tip 5: Don’t stop filling the pipeline
Having a strong project pipeline or “backlog” is critical regardless of the size or type of projects you do. I know from experience when you “take your foot off the gas” and stop going after work because you are so busy, guess what happens…….you get slow and it can take months to ramp up again. This is something that is so easy to do when you are busy so use your timeline chart to help you see the work fall off before it’s too late to fill it back up.
Tip 6: Diversification = insurance
Ever heard the term “don’t put all your eggs in one basket?”. That is what diversification does….it helps you get through the slow times by not being too narrow in your offering or client base. For our company, we prefer to do medium sized projects when times are busy. When work slows down, however, we will do small projects to keep busy. Another example is working for one main client or GC. Something can change and that client can go away very quickly. Make sure you have other streams of work that can get your company through the slow periods.
Summary
In construction, the rollercoaster of project workload is not going away. We can, however, smooth out the highs and lows with some strategic planning and smart tactics. Creating a backlog of work and being able to visualize the workload is an important first step.
With a more consistent workload you will be able to live a better life with less stress.
Additional Resources:
- Download the “Perfect Construction Timecard Template” to get your workers tracking time so you can start job costing
- Try BuildCenter for free to see how you can track workers time and automatically apply to jobs
