How To Grow Your Construction Contracting Business: 9 Strategies

1. Set SMART Goals for Your Business 

Defining strategic goals makes your construction business successful and unique while maximizing its potential.

Evaluating the current status of your construction contracting business is the first step in strategizing for its growth. Does your company have repeat business? What kind of reviews or star ratings your services are getting? How low or high is your employee turnover? Finding answers to such questions will help you establish future goals. 

For example, if your construction business is experiencing cash-flow struggles, obtain lines of credit, loans, or other forms of financing. 

Once you have determined objectives, set SMART (Specific, Measurable, Achievable, Relevant, Time-Bound) goals for leveling up your construction business: 

1. Specific: Generating annual revenue of $1,000,000.
2. Measurable: Winning 5 major construction contracts. 
3. Achievable: Get qualified leads with a focused marketing strategy, both online and offline, targeting specific niches. 
4. Relevant: Boosting company revenue and industry reputation. 
5. Time-Bound: Successfully executing all five construction projects within 1 year. 

Another example of a SMART goal can be:

A construction firm wants to reduce its project completion time by 15% by training 20 employees in BIM and project management tools under 6 months. By implementing technology in construction processes, they aim to improve project efficiency. 

Develop a reliable system for tracking the progress of each task. Create regular reports, hold team meetings, and optimize plans accordingly. Most importantly, reward your employees for achievements, boosting their morale and productivity. 

2. Narrow Down on a Niche 

Specializing in a niche market sets your construction company apart from others.

The phrase, “A mile wide and an inch deep” truly applies to the construction business when it comes to service offerings. Hence, narrowing down your niche will make your contracting business a preferred expert in that specific area of construction, attracting clients seeking specialized services. 

Since studies reveal that half of Americans became millionaires by investing in commercial properties, we can say that commercial construction is one of the thriving industries. Office buildings, lodging facilities, RV parks, and storage facilities are the most profitable niches in the field of commercial construction. 

For example, if your company specializes in “commercial office building” or “retail renovation projects”, optimize your website SEO and online profiles to promote those niche services. This will increase your chances of getting hired whenever a business owner searches for a commercial contractor for their office or retail construction project. 

To further grow your construction business in niche services, try these strategies:

• Expand offerings in your core specialization, for example, provide interior designing services and building maintenance services along with office construction.
• Break into luxury niche services like solar panel installation, 3D printing, or skyscraper construction projects. 
• Grow your construction business in new locations, cities, or even states where demand for your niche services is high. 

You can demand premium prices for specialized knowledge, boosting your profit margins and business revenue. Working in a targeted niche also means facing fewer rivals and winning more lucrative contracts. Overall, identifying your niche within the construction contracting industry ultimately leads to increased authority, revenue opportunities, and business growth. 

3. Build a Dedicated Construction Team 

Hiring the right professionals, rewarding their achievements, and empowering them with skill training are the ways to build a dedicated construction team. 

As your construction business grows, hire additional employees strategically, ensuring they align with your company’s vision. Besides technical hard skills, contracting business professionals should also possess soft skills. For example, excellent communication, problem-solving, flexibility, teamwork, attention to detail, and other important personality traits. 

Once you have shortlisted candidates using an applicant tracking system (ATS), interview them to evaluate their proficiency. Use various recruitment practices before hiring; for example, you can conduct a hands-on job day where a worker is asked to interpret blueprints, operate construction machinery, or handle material selection. This approach will guarantee that only qualified workers are hired for the company. 

Offer regular safety training focusing on heavy machinery operations, material handling, and tool usage, which will boost employee morale and retention. Cross-train employees in different areas of the construction business to lessen the impact of absent employees. 

As the captain of the ship, motivate and lead your team towards success. Therefore, developing and maintaining a positive company culture is essential for growing your construction business in the long run. 

4. Deliver Quality Customer Service

Satisfying customers with exceptional service develops a positive reputation for your construction contracting business. 

Customer service begins with actively communicating with your clients, so you can meet all their expectations without fail. Respond to customer inquiries immediately.

For instance, after receiving a detailed inquiry on specifications for a building design, promptly respond with, “Thank you for reaching out. We’re actively gathering all the detailed information and will soon follow up with you.” 

Your clients will always remember how they got treated throughout the project, hence, hire workers who are respectful, patient, and talented. Avoid any misunderstandings by updating clients about the project’s progress in real time. Make efforts to go the extra mile for each project. 

Suppose, the client requests a last-minute expansion of the lobby area to accommodate extra seating. Quickly adapting to updated plans, your team needs to reallocate the resources and execute the job within the designated timeline, in order to surpass your client’s expectations. 

Word-of-mouth is one of the most effective advertising strategies for growing a small construction business. When you prioritize quality customer service consistently, it nurtures brand loyalty, earning repeat business and client referrals. As a construction business owner, keep seeking honest feedback from your clients, identify where they feel dissatisfied, and work on those aspects. 

5. What Social Proof to Build Trust 

Giving proof of customer satisfaction helps to gain the trust of potential customers.

If you want to grow your construction contracting business, providing social proof of customer satisfaction will establish your industry reputation as a trustworthy firm. Social proof represents honest feedback, endorsements, and experiences from your past clients that can attract potential new and repeat customers. 

You can prove your credibility as a construction business in the following ways: 

• Online Reviews – Ask your clients to submit their reviews on top platforms like Google, Yelp, and Facebook. Email review requests with quick links to review pages. Incorporate positive testimonials from satisfied clients on your website, indicating the quality of your services. 
• Testimonials – Seek permission from your clients to publish their honest feedback directly on your website. Additionally, include top reviews from third-party platforms. 
• Case Studies – Apart from the project gallery, include project case studies that will explain the challenges faced and how you derived successful solutions.  
• Project Photos – Visual proof of your finished projects demonstrates your business’s versatility, quality of workmanship, and reliability. Add construction process videos and before-and-after photos of various projects to your website’s portfolio. 
• Awards and Certifications – Highlight your professional excellence as a construction business by showcasing awards and certifications officially recognized by industry authorities. 
• Word-of-Mouth Referrals – Encourage happy customers to share their experiences about your contracting business with family, friends, colleagues, or on social media profiles. 

A global survey conducted by FMI and Autodesk reveals that trustworthy construction contracting companies have more repeat business, driving 2% to 7% higher gross margins than organizations without much trust. 

6. Match Newer Opportunities to Your Growth Goals

Seizing newer opportunities in high-demand sectors keeps your construction business ahead in the market. 

In the construction contracting industry, newer opportunities generally reflect the changing dynamics of the market. For instance, commercial building projects related to fast-food restaurants increased during an economic downturn when people were limiting their spending on lavish hotels. 

Similarly, the COVID-19 pandemic resulted in an enormous demand for the construction of healthcare facilities. Offices were renovated to accommodate hybrid work models while restaurants built outdoor dining spaces and drive-thru lanes. 

For your construction business to grow exponentially, seize newer opportunities in sectors with increased demand. Adapt your services to the client’s emerging needs and devise innovative solutions. This will help you position the construction contracting business uniquely in the market. 

While it is important for contracting businesses to take advantage of newer opportunities, make sure that the project fits your expertise and growth goals. 

7. Focus on Networking

Networking can create brand awareness, generate leads, and find vendors for your construction business. 

To grow your construction contracting business and win more clients and contracts, you have to network in local contractor associations or stay reachable to large construction companies that outsource. Forming professional connections with general contractors, architects, property managers, and engineers will create brand awareness in the market, generating valuable leads for your construction business. 

Join an industry association, for example, the Associated General Contractors where you can learn profitable business skills, upcoming regulations, industry trends, or expert construction-related tips. You can build a strong professional network by attending conferences, fundraising events, trade shows, exhibitions, and other business meetings. 

Matt Swann, president of Brawn Construction, advises construction business owners to leverage their business cards so that others can contact them to hire their company. 

Moreover, networking with suppliers will provide you with discounted deals and cost savings on equipment, materials, or tools, something that appeals to every customer. Helping other contractors in their building projects or making donations in a community is another great networking strategy to grow your construction contracting business. 

If you are about to spend a few weeks or months on a project, try to network with trade and specialty contractors at the actual job site. This is one of the easiest ways to expand your network as it allows you to meet contractors who may work with your contracting business in the future. 

8. Using Technology for Efficiency 

Investing in specialized construction software can help you deliver efficient services, improving business growth. 

As a construction contracting company, you should make long-term investments in smart technologies that can help you complete projects on time and at lower costs. From software to mobile applications managing every aspect of a construction project, new technology can streamline processes and boost productivity. 

According to JBKnowledge’s 2021 Construction Tech Report, 44% of contractors have dedicated IT departments, using tech solutions for estimating, scheduling, project management, and safety. 

We recommend using the following tech solutions to grow your construction business efficiently: 

• Construction tender management software 
• Construction estimating software 
• Project management software
• Cloud storage solutions 
• Customer relationship management (CRM) software 
• Human resource management (HRM) systems 
• Building Information Modeling (BIM) software 

Most software solutions are cloud-based, meaning team members will be able to update documents, schedules, and tasks in real time. For example, a construction employee working on-site submits a request for information (RFI) to clarify the installation procedure for a new energy-efficient heating system. 

9. Market Your Construction Business 

A strong online presence helps drive qualified leads for modern construction companies.

Today, most customers are using the Internet to find local businesses. If you want to skyrocket your construction contracting business, develop an online marketing strategy to put yourself out there. Without marketing efforts, your contracting business will either turn stagnant or decline. 

Follow these valuable tips on how to market your construction contracting business:

• Launch and optimize your Google Business Profile using local keywords including “construction contractor near me” or “construction companies in San Francisco”.
• Run highly targeted pay-per-click (PPC) ads and Google ads to market your local construction services.
• 75% of people judge a company’s credibility based on its website design. Your website should be navigable, visually appealing, and encompassing necessary information related to your business. 
• Leverage social media platforms like Facebook and Instagram that offer targeted ad features based on location, user behaviors, financial income, interests, etc. 
• Incorporate engaging video content about construction topics into your website and social media, driving maximum traffic. 
• Maintaining an informative construction blog can improve your SEO and overall business authority. 
• Keep your brand top-of-mind by sending tailored emails marketing construction services to your subscribers. 

Online marketing, especially helps to reach new potential customers on multiple channels, leading to the construction business’s growth. Whether it’s website SEO, content marketing, social media marketing, or digital advertising, pick your channels wisely and invest depending on your budget. 

Conclusion 

When it comes to growing your construction contracting business, there are many useful strategies, from identifying a niche and establishing achievable goals to providing quality service to marketing your brand. With the right mindset and the determination to follow these strategies, there is no reason why your construction contracting business can’t make more money and fulfill your goals. 

Work With Us 

If you are looking for a dependable commercial general contractor, look no further than us. Constructive Solutions, Inc. has decades of experience handling commercial construction projects across San Francisco, San Jose, and San Mateo. 

Contact us today to discuss your building needs. 

FAQs

Is construction a profitable business?

The construction contracting business is profitable, however, industry experts suggest average margins are 1.5-2%, lower than other sectors. Fortunately, with operational redesign, contractors could reach 20-30% margins.

What construction business has the highest profit margin?

Land developers have the highest profit margin with an average pre-tax margin of 17%, followed by remodeling and excavation at 7.2%.

How to start a construction business? 

To start a construction contracting business, follow these steps: 

1. Register your business; obtain necessary licenses and permits.
2. Secure the required funds. 
3. Purchase a commercial space for office work. 
4. Build a network of suppliers, employees, subcontractors, and potential clients.
5. Invest in necessary equipment and insurance. 
6. Market your business via online marketing and networking.

Relevant Resources:

• 15 Great Sources for General Contractor News
• How to manage your clients and sub-contractors so they don’t bypass your business