Small construction enterprises continually face a challenging landscape in competing with their larger counterparts. The resource disparity, limited networks, and stretched workforce often put these smaller organisations at a disadvantage in securing profitable projects and thriving in the industry.
Challenges and Risks for Smaller Contractors
The struggles faced by these small construction businesses often lead to narrow profit margins, intensifying the pressure to perform really well. In an environment where merely 35% of small contractors manage to surpass their fifth year in business, these companies have to deal with lots of challenges and risks.
Incomplete design documentation and missing plan details pose some hurdles for smaller contractors. They consume a lot of really valuable time in the bidding process. The risks of winning unfavorable projects that could even bankrupt a company tells us how precise project selection needs to be for the survival of smaller firms.
Reduce Risk by Embracing Technology
Overcoming manual processes and the reluctance to use technology is a must for smaller construction firms. Many companies just insist in continuing the use of outdated methods, such as spreadsheets, despite the fact that they are known for inaccuracies and time-consuming data entry. Embracing technology is a great solution to be rid of these everyday risks and inefficiencies.
The fact that smaller contractors refuse to adopt high-tech tools impacts their ability to compete effectively. Nevertheless, introducing modern technologies, even in basic forms will still offers lots of benefits.
Simple Steps to Level the Playing Field
The implementation of technology does not need to be complex at all, it could involve just a simple digitization and automation of administrative tasks. The shift from paper based processes to automated time tracking apps and modern type of accounting software is a step many contractors are taking to make improvements. You really have to decide whether you want to grow your business or stick to your old ways of working, because that’s what it comes down to in the end. Lots of small construction companies have a lot of potential but they’re so set in the way they work they refuse to see how technology could benefit them.
New technological solutions, even in their basic form have potential for smaller construction firms. Whether it is embracing software for estimations or adopting enterprise resource planning (ERP) systems to automate the back office, companies can use these tools to get more projects and earn a profit even with tough competitors. In the past it was a little bit easier for smaller businesses to continue to get work from their localities. But now with technology it is harder for small businesses to stand out and construction firms that are marketing themselves properly tend to reach potential customers and clients first.
In order to continue to get customers and level the playing field a little bit smaller firms need to take some action. With technology they can automate certain jobs and focus more of their energy on tasks that require extra effort and attention. Besides it is a known fact that it is better for construction estimators to use technology so they can get results that are free of human error. When you have tough competition you don’t want to mess up on a bid just because you miscalculated.