Perhaps owning your own contracting business is a lifelong dream of yours. And maybe you’ve been working in a specific trade for many years, just biding your time, waiting for the right moment to branch out and offer your unique set of skills to the world.
Well, if this is your plan, there are a few simple strategies that will help you become successful in the contracting world. But along this same line, there are also a few things that you should avoid doing at all costs.
Studies have shown that more than half of all business ventures fail before the 5-year mark. And no matter what industry you’re in, there are several pitfalls that you should learn to avoid–one of which is excessive spending.
If you want to grow into a successful career as a contractor, and you hope to establish yourself in your community, here are 3 things that you should never do.
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Early Expansion
They say Rome wasn’t built in a day. But one key reason for its fall was simply due to overexpansion. Essentially, Rome spread itself too thin, expanding beyond available resources. And this invited untenable economic troubles.
The same principle holds true in the modern business world. And you’d be surprised at how many businesses fail before reaching the 5-year mark just because business owners were far too eager to expand.
We find this principle again in the contracting business as well. The key takeaway: Build now, expand later.
You’ll find that you’ll be far more successful if you spend the first few years of your contracting business establishing relationships and focusing on producing quality work. After you have a firm foundation to work from, then you’ll likely have additional resources to allow for expansion.
Overspending
Perhaps the biggest reason why contracting businesses fail is that owners tend to overspend on materials and equipment. And this mistake can easily be avoided by utilizing cheaper resources.
For example, as a contractor, you probably want to land those big-paying jobs. But those big jobs probably require heavy machinery or other equipment that you don’t currently own. And if you’ve ever priced a new backhoe, you probably know that you could spend around 90,000 dollars on average just for this one piece of equipment.
As a means to allow yourself to work on larger jobs, consider renting work vehicles and heavy machinery. You’ll be able to get the job done and save a ton of money in the process by following this strategy.
At the end of the day, the best practice is to fill your time with smaller jobs, and only take on the big jobs when you have the capital to do so.
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Underestimating the Power of Marketing
No business can succeed in today’s busy world without gaining attention from customers. And this is done through marketing.
The problem in the contracting business especially is that most owners simply forget to market themselves, or they neglect to come up with a marketing plan before going into business–and this is truly the beginning of failure.
All businesses need a marketing strategy. And in the contracting space, this begins with relationship building and advertising. If you neglect these critical elements, you’re bound to a short business lifespan.
The fact is, the more you put yourself out there and engage with other professionals and members of the community, the more organic exposure you’ll gain. And this is what will ultimately make you successful in the long run.
Finally, don’t forget to utilize your local advertising resources such as local television and radio ads, as well as implement a social media marketing strategy into your plan.
The contracting space is a business like any other. As such, you need to embark on this journey with a sound business strategy in hand and execute your plan systematically as you grow and gain clientele. Doing so will allow you to grow into success, and offer you a long and rewarding career.
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