As a general contractor, there are three ways that you can increase your bottom line. You can either charge more, reduce your operating costs, or do both.
Reducing your costs is, in our opinion, the easiest and fastest way to increase your profits. There’s a strong chance that you’re spending more money than you should in certain areas, and if you haven’t looked over your operation yet to see where you might be overspending, then you should do it right away and see where there might be some issues.
Let’s take a look at how you can keep your costs low as a general contractor.
3 Crucial Ways To Keep Costs As A General Contractors:
1. Work with the Right Suppliers
Your suppliers will make a big difference in how much money you keep in your pocket, so choose them wisely. Look for multiple suppliers and compare their quotes. Ask if they offer special bulk discounts and when these discounts kick in.
And see if you can buy everything from the same suppliers as you’ll usually be able to get discounts that way. Note that not everything can be bought in bulk, however, and it can be hard to find great discounts on single items or items you only need a few units of, but it’s still possible.
If you’re looking for single tools, for instance, or a toolbox or bag, then the best way to save money here would be to go for specialized online retailers. They will usually be much cheaper than your average hardware store while offering professional-grade quality.
These tool-bags, for instance, are much cheaper than anything you’d find anywhere else, so if this is something you are looking for, this retailer is a great place to start.
2. Improve Site Management
The way you manage job sites will also affect your cost. Poor site management can lead to delays and not managing employees properly could lead you to pay for much more work hours than you should.
Various tools will allow you to manage your sites better, but everything starts with your site managers. So, make sure that you’ve vetted them thoroughly and that they have the skills needed to keep everyone in line.
They should be good communicators and be strict without being domineering. They also have to have great people skills, be well organized, and work well under pressure.
3. Hire the Right Employees
The employees you pick will also make a huge difference to your bottom line. You have to hire people who are motivated and believe in doing their job correctly. Before you hire anyone, make sure that you conduct a thorough background check and check references.
When interviewing them, try to gauge their general attitude and ask any references if they have had issues with absenteeism before. Absenteeism is very bad for contractors as finding replacements at the last minute can be close to impossible, so this is something you have to know before you even think of hiring someone.
These are all things that will allow you to reduce your operating costs significantly as a good contractor. Always keep a close eye on your expenses and find ways to be as frugal as possible without compromising the quality or the safety of your employees.