Brought to you by Construction Business Owner
Economic downturn
What are construction companies doing to adjust to the economic downturn? Surviving? Restructuring the business? Losing godd employees that may not come back?
Bill
Bill
Views: 0
Replies to This Discussion
-
Permalink Reply by Brian Hall on -
Hi, This is something form Sussex enterprise our local chamber of commerce which might help stimulate discussion.
Best Wishes
Brian
Business News Online January 2009
Top ten actions businesses are taking to combat the downturn
In November 2008 we conducted a survey of customers and asked them what actions they have taken to lessen or mitigate against the effects of the downturn.
The vast majority, 85%, had already taken at least one of these advisable precautions:
1. Revise your Business Plan (41%)
Major events in your business' environment should trigger a review of your strategic objectives.
Read our guide: how to review your business performance
2. Streamline processes to cut costs (41%)
You can identify wastage to reduce, but be careful not to cut costs at the expense of the quality of your products and services. Read our factsheet: manage your costs
3. Use or investigate different sales channels (41%)
Try our 5 minute online interactive tool: Identify potential sales channels
4. Reduce business journeys made by car or reduce fuel costs (39%)
Think about ways you can cut down on the need to travel.
Read our money saving guide - How to create a workplace travel plan
5. Seek cheaper suppliers (39%)
A sharpened focus on buying will reduce your business costs.
*
Case study
McMillan Scott rationalised its supplier base and negotiated better deals with key suppliers. Find out how: Here's how I reduced supplier costs.
Download this factsheet from the Buying Support Agency Why shouldn't your business benefit from best practice buying? - Opens in a new window
6. Implement waste management activities (28%)
There are free national and local site surveys to look at ways to cut your waste, water and energy costs. Email us for more information.
7. Reduce worker hours ( 17%)
8. Make redundancies ( 12 %)
9. Implement pay freezes (12%)
Explore options to manage wage costs. Read our factsheet on redundancies, lay-offs and short-time working
10. Seek alternative finance (11%)
Business Link will be announcing improved access to funding very soon. Please refer to this article: Finance and support news.
Price drops
We have not asked customers if they were dropping their prices. However there is evidence in the construction industry in particular of deflationary tactics with contractors resorting to 'zero-profit' bidding. Building Magazine reported in December that tender prices in the private sector* are being cut by 10-15% in attempt to bolster order books. The practice of “buying turnover” is ill-advised say experts who warn low bidders to expect crippling cash-flow problems down the line. You can find out more about how to bid sensibly and profitably for commercial and public contracts at our Bid Writing Workshops.
-
Permalink Reply by Bill Cook on
-
Brian Hall said:Hi, This is something form Sussex enterprise our local chamber of commerce which might help stimulate discussion.
Best Wishes
Brian
Business News Online January 2009
Top ten actions businesses are taking to combat the downturn
In November 2008 we conducted a survey of customers and asked them what actions they have taken to lessen or mitigate against the effects of the downturn.
The vast majority, 85%, had already taken at least one of these advisable precautions:
1. Revise your Business Plan (41%)
Major events in your business' environment should trigger a review of your strategic objectives.
Read our guide: how to review your business performance
2. Streamline processes to cut costs (41%)
You can identify wastage to reduce, but be careful not to cut costs at the expense of the quality of your products and services. Read our factsheet: manage your costs
3. Use or investigate different sales channels (41%)
Try our 5 minute online interactive tool: Identify potential sales channels
4. Reduce business journeys made by car or reduce fuel costs (39%)
Think about ways you can cut down on the need to travel.
Read our money saving guide - How to create a workplace travel plan
5. Seek cheaper suppliers (39%)
A sharpened focus on buying will reduce your business costs.
*
Case study
McMillan Scott rationalised its supplier base and negotiated better deals with key suppliers. Find out how: Here's how I reduced supplier costs.
Download this factsheet from the Buying Support Agency Why shouldn't your business benefit from best practice buying? - Opens in a new window
6. Implement waste management activities (28%)
There are free national and local site surveys to look at ways to cut your waste, water and energy costs. Email us for more information.
7. Reduce worker hours ( 17%)
8. Make redundancies ( 12 %)
9. Implement pay freezes (12%)
Explore options to manage wage costs. Read our factsheet on redundancies, lay-offs and short-time working
10. Seek alternative finance (11%)
Business Link will be announcing improved access to funding very soon. Please refer to this article: Finance and support news.
Price drops
We have not asked customers if they were dropping their prices. However there is evidence in the construction industry in particular of deflationary tactics with contractors resorting to 'zero-profit' bidding. Building Magazine reported in December that tender prices in the private sector* are being cut by 10-15% in attempt to bolster order books. The practice of “buying turnover” is ill-advised say experts who warn low bidders to expect crippling cash-flow problems down the line. You can find out more about how to bid sensibly and profitably for commercial and public contracts at our Bid Writing Workshops.
-
Permalink Reply by Bill Cook on
-
Thanks Brian. Some really good thoughts here. I'll sumarize all the reponses I get later.
Bill
-
Permalink Reply by Steve Donnelly on -
A good question but one with a pretty obvious set of answers. Firstly margins have to drop and the points seem to be driven by the cost of 'keeping the lights burning'. The first employees to be released are those that become noticeable for their lack of production, commitment and ability to be profitable. My company has focused on the core competencies and now avoids frivolous moves into scopes that are considered risky. The next big issue is watching for the health of subs and vendors and making sure that the front-loading days are gone!
Finally you get the opportunity to see the team members who shine and are committed to the health of the company and not just trying to keep their jobs, I have several and I also have some who now have a spotlight on them; times are different, pay raises have stopped, loose threats to leave have stopped... In some respects we are only just getting to a point where we can now rely on good folks...
Steve Donnelly,
teamglobalgroup.com
-
Permalink Reply by Jon Mendelson on -
Market, Market, Market and have a plan to do it
-
Permalink Reply by John M. Feeney on -
Most companies I talk with are very skeptical of what the near future holds. Some are actually expanding there coverage area's just to get jobs.
Many just look out their windows and see the yard full of equipment, not a good sign.
The Place to Connect with Contractors Worldwide
About
© 2012 Created by Hardhat Connect.
