Five Rules for Growing your Building Business in Australia

building business growth

Growing your building business is not as hard as you might think.

Some of you will know that I used to have a building company. It’s been a while now, I founded the company in 1983 and I sold the company to my junior partner in 2003, but I have many fond memories of my building days (and some not so fond).

Because of my background I am often asked how to grow a building business, while keeping margins up. In my experience, business growth in the building industry comes down to implementing Five Golden Rules:

  1. Be empathic
  2. Be predictable
  3. Under-promise and over-deliver
  4. Say No
  5. Communicate

Probably not the Rules you were expecting, so let me explain:

Muddy boots and cream carpets

The building industry in Australia is a strange beast. On the one hand, because of it’s widespread system of contractors and sub contractors, I believe it’s probably one of the most efficient building industries in the world, but on the other hand I also believe it is one of the unruliest building industries in the world. Most of us know one or more horror stories of builders going bankrupt, subbies walking off site, costs spiralling out of control, tradies walking muddy boots through cream carpets, leaking bathrooms, disputes before tribunals and indecipherable quotes on the back of enveloppes.

I’ve certainly have my fair share of war stories from my 20 years in the building industry in Sydney. And to be honest, I’ll even admit that I and my company might even have been at the root-cause of a couple of those stories.

It’s not easy running a building or building-trades company in Australia. But there’s two sides to that coin. There’s great opportunity in the building industry to grow your business and make good money, because there are so many drongos out there and customers are desperate to find professional reliable businesses to deal with.

Laying out the red carpet

It was that way in my days as a builder. The good, professional, reliable, tilers, bricklayers, carpenters, painters, plumbers, electricians, concreters, renderers and roofers were always busy. I would have to book them in 6 weeks in advance, I’d have to pay them well and lay out the red carpet for them, or they’d go somewhere else. And I learnt that I’d better do all of that, and then some, because getting the cheaper, available tradies always led to disasters of one kind or another and most importantly, unhappy customers.

The Golden Rules:

Hence my Five Golden Rules for Growing your Building Company above, because this is what I learned about developing a growing Beautiful Building Business (and Life):

  1. Be empathic: Building contracts are big things, in dollar terms as well as scope. Customers enter into building contracts with great trepidation, because it’s usually the biggest contract of any type they’ve ever signed and they can’t even see what they’re buying yet. You need to be sensitive to that anxiety, that all customers experience at some stage in the journey. You deal with big contracts and big turnover every day. For your customers it’s a great source of stress. Stress makes people behave irrationally… Make allowances for that.
  2. Be predictable: People are happy to pay your price if they feel confident they’ll get what they are expecting. If they don’t have that confidence, they’ll shop on price because that’s the only thing they can control.
  3. Under-promise and over-deliver: If you say you’ll be ready with something by Friday, surprise them and finish by lunchtime on Friday and then take some time to really clean up, dot the I’s and cross the T’s. Don’t ever tell the customer you’ll be all finished by Friday and then when they come home from work on Friday it’s still unfinished and a mess… That’s just asking for trouble.
  4. Say No: Don’t take on work you don’t feel confident you can deliver, fully, properly, on time, profitably and with a smile. Say yes, only when you are 100% confident you can do it how it’s meant to be done.
  5. Communicate: The three C’s: Communicate, Communicate, Communicate. If you come to the conclusion on Wednesday that you can’t complete the job on Friday as you promised… Tell them… on Wednesday… By email, by letter, by carrier pidgeon, by SMS, or by Whatsapp or Twitter… But for Pete’s sake, tell them. They won’t know, they expect to have a Barbeque on the new deck on Friday evening and they’ve invited their friends to celebrate. Similarly… If you strike something unexpected, you hit rock where you didn’t expect it, asbestos in the roof, an aboriginal artifact in the footings, a conflict on the drawings, you find out you’ve made a mistake in your calculations, ordered the kitchen benchtop 100 mm too short, or forgotten to order it at all… TELL THEM. Seriously. They’ll understand. They’ve made mistakes in their life as well.

And if you do all of that… If you live and breathe those rules, every day, and you hammer those rules into the heads of your employees and subbies, your business will grow and grow and grow, because your customers will be your Raving Fans and they’ll do your marketing for you. They’ll tell their friends all about how you finished the deck early on Friday, cleaned and tidied up and left a bottle of wine to have with the barbie on the deck when you came home from work. They’ll talk about you to their work-mates and convince their neighbours to have their own decks built by you as well, even though they’ve had cheaper quotes.

The alternative means you’ll have to endlessly compete on price and competing on price is a dog’s game… trust me on that.

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AYB Business Coach for Builders

Builders, contractors and trades

Watch this quick video in which I explain about a couple of the unique challenges that are part of running a business in the building  and trades industry in Australia.

I have worked with many builders, subbies and trades people over the years. The building industry in Australia has many great opportunities to build Beautiful Businesses and Lives, but it also has a bunch a unique challenges. I love supporting tradies to become mature business owners and help them build Beautiful Businesses and Lives.

“Working with Roland set the path for my business to be everything I dreamed it could be”

(Brad Chapman BIC Construction)

Does this sound like you?

These are some of the things I hear people in the building industry say all the time (and to be honest, I’ve certainly said most of them myself at different times in my building days):

  • “I spend so much time training my staff and as soon as they’re all trained up, they go and start out on their own.”
  • “I spend days preparing detailed budget estimates for clients and architects but in the end they still just pick the cheapest quote.”
  • “I’m always the last one to get paid”
  • “My staff earn more money than I do.”

building trade construction builder subbie

  • “As soon as I turn my back they stuff something up.”
  • “I have no idea where I make money and where I lose money.”
  • “I’m so busy but I think I made more money when I was on my own.”
  • “I’m always struggling to pay the tax bill when it’s due.”
  • “I’m run around from crisis to crisis, extinguishing brush fires all the time.”
  • “I get stuck doing jobs I don’t actually want to do (my friend’s bathroom, my uncle’s deck).”
  • “The last 5% of any job has as many challenges and takes as long as the first 50%.”

As a former carpenter and builder myself I know what those statements are about and I have worked with many builders, carpenters, plumbers, electricians, painters and others on turning those challenges around.

“Working with Roland taught me the correct way to run a business and more importantly, run it so that I can spend more time with my family.”

(Mark Nashaty, On the Go Plumbing)

Click here to download my Free Guide to finding the perfect coach or mentor for you.

What you can expect:

How I’ll help you discover and build your own Beautiful Business and Life:

  • Implementing better bookkeeping, workflow management and project management systems; Your fingers on the pulse of all the key indicators of the health of your business, as opposed to keeping your fingers crossed.
  • Developing absolute clarity about the Purpose of your business; the reason your business exists and why anybody should care about that; Know where you’re going and how you’re getting there.
  • Developing marketing plans that are simple and effective; Clients walk in the door, wanting to do business with you.
  • Building relationships with the right people; Referral marketing is the most powerful way to build your business.
  • Designing and implementing Quality Assurance and Safety approaches that are practical and appropriate for your business; Make your business run like a Swiss clock.
  • Developing systems and procedures that you can rely on; Feel confident that things happen the way you want them to happen even when you’re not looking.
  • Developing better approaches to managing and engaging your staff and your subbies, so that you won’t have to stand there and watch them all day.

“Roland helped me install the right systems into my business and helped put all the missing pieces together to form a business that is now performing 100% better on all fronts: It’s making profit, my clients love our work and my staff love working with me, and It’s a lot of Fun.”

(Brent Tamati, Direct Building Solutions)

Five Steps to Discovery

If you recognise some of those statements above and you’d like to explore how I can help you overcome some of those everyday struggles, click here to book in a free Discovery Coaching Session now as part of my Five Steps to Discovery Process, designed to help you discover and build your own Beautiful Business and Life.

More reading, books, surveys, webinars

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