Use growth to beat the next recession

Boom and bust cycles are a part of economic life – what’s important is that you not only grow your business with the recovering economy, but ensure you don’t lose those gains in the next recession 

With the economy slowly recovering, self-employed builders have the opportunity to grow their businesses. A smart builder uses these times to improve his business, so it thrives now and is well positioned for the next recession. Here are four tips to help you lay strong foundations now, to ensure your business remains healthy during the next recession.

1.  A long-term plan

While the marketing of yesterday may not be relevant today, it’s worth taking time to review what did work during the recession and file it away – it will give you have a successful foundation to build upon when the next recession hits. With some updating, your old strategies are likely to give you get a head start, while others flounder.

Skilled labour is easier to find in a recession, which means less supervision is needed. But when skilled labour is scarce and you have to work with lower skilled or migrant workers, you need to ensure better supervision. During a recession, get your skilled team to record the processes and systems they use to complete efficient, quality work first time – these systems become a valuable tool to keep less skilled workers on track when growing your business.

2.  Work on your sales skills

During a recession, you need better sales skills. However, when growth comes along, it’s easy to forget these skills and rely on demand to assure you work. The temptation when you are busy is to fill your week with on ‘the tools’ work, because the money is good and it feels great to be getting it again. This is not a good long-term strategy; those profits are lost while trying to survive the next recession.

Long-term, real profits are directly related to a business’ ability to sell. If you lose your selling skills, you will be destined to stay on the tools forever. This is okay, if it’s what you want, but not if you wish to grow a building business. Growth periods are the best time to develop sales skills, because you can afford to lose a few sales, while growing your skills.

“Long-term, real profits are directly related to a business’ ability to sell. If you lose your selling skills, you will be destined to stay on the tools forever

3.  Build your online presence

Many builders underuse the internet as an advertising tool. Ask yourself where you last searched for a restaurant, a mechanic or subcontractor: chances are it was the internet. A strong website is vital to a growing business.

In the past, a website with a great gallery and heaps of information may have been enough to get business; it is unlikely to keep working in the future. As the competition gets stronger, you need a website to attract your market’s attention.

Now is the time to start focusing your web marketing budget on developing targeted, specific websites and online strategies that will attract visits from your specific target searchers. As search engine technology gets more and more sophisticated, websites providing specific answers are likely to be the ones with the most visitors.

4.  Grow your business intelligence

It’s easy to let things slide with money in the bank and work in the schedule. Monthly reports measuring advertising and sales effectiveness, back-quoting to measure productivity and other documenting routines can all get forgotten when business is good.

However, businesses do collapse in growth and it is always the right time to improve your information gathering systems and efficiencies.

A wise man once said: “Build your house on the rock.” Now is the right time to do just that; solidify your business foundations so, no matter what the forecast, it will withstand the elements. The beginning of a growth cycle is always the best time for wise investment in your businesses future.

 

About The Successful Builder

Graeme Owen, based in Auckland, is a builders’ business coach. Since 2006, he has helped builders get off the tools, make decent money, and free up time for family, fishing, and enjoying sports. Get his free ebook: 3 Reasons Builders Lose Money and How to Fix Them for High Profits at  http://TheSuccessfulBuilder.com.