It’s important to be prepared when planning your next moves. A recent survey conducted in April shows that construction output growth in 2020 could range anywhere from zero to -8%. While this news may seem bleak, a strategic plan can help you navigate through the uncertainty.
Target Growth Sectors
While some industries may struggle during the next 12 to 18 months, there are many sectors that will grow. By undertaking a deep analysis of the current economic landscape — and reanalyzing the landscape every few months — construction firms will be able to redirect their resource efforts to industries expected to grow. Going forward, it is best to diversify current sectors. For example, construction firms that focus on serving realtors may want to redirect some of their resources into industries with more favorable growth prospects, such as retail distribution chains and grocery stores.
As seen previously, smaller firms may be more flexible in sales terms during a period of recession. If a smaller firm has a healthy enough balance sheet, it is worth considering an acquisition. Not only will this diversify business, small acquisitions allow larger construction firms to boost both its exposure and expertise, allowing them to build long-term resilience.
Investing in Tech
There’s often a long list of technology upgrades that construction firms wish to implement, but for one reason or another, they have not gotten around to. Investing in new technology solutions can allow a construction firm to leverage data, improving efficiency and decision-making. These tools will allow firms to analyze the recession’s impact on their own business as well as on numerous sectors. With this quick and relevant information, resources and time will be freed up, and firms can focus their time on completing more productive tasks.
Technology also allows organizations to continue working from home in the event of a second wave. With 90% of construction firms continuing to work from home during these uncertain times, it is clear that collaborative technology is here to stay. Investing in your firm’s technology will not only make working from easier, but it may even lead to increased safety when projects begin to pick up again; many in the industry have used this time to develop new safety procedures that can be implemented in future projects.
Search for New Talent
As the previous recession demonstrated, crisis often sparks talent. Construction firms should actively seek out new talent. By recruiting high performers at bargain prices, companies can restructure their teams to ensure talent at every level. However, note that the recruitment process is set to take place almost entirely online. Open your recruitment opportunities up to new platforms, including Indeed and LinkedIn.
With a strategic plan, construction firms will be able to navigate the upcoming recession. It’s important to begin analyzing growth sectors and planning now; being ready for the recession could very well be what gets you through it. At Small Business Growth Partners, we can help you develop strong internal operation systems that will prepare your business for growth. Our model caters to the unique needs of the construction industry.