With the heightened stress at the moment regarding COVID-19, It’s important to take the time to address the situation that is at hand, be proactive and not shy away from it or expect it to all blow over in a few weeks.
Everyone is affected by this in some form and in order to get through this as a collective, leadership, transparency and kindness are attributes that must be acquired now more than ever.
With a lot of jobs in the global building industry coming to a halt, now is the perfect time to assess and address your company’s current structures. Identify the areas that need improving so your business can come out stronger once the dust has settled.
To make your building company more resilient through COVID-19, implement these 11 steps:
1. Review your profit and loss
Now is the time to review your profit and loss to see where you can cut costs. Go line-by-line through your P&L and identify easy to lose expenses and areas you can remove that don’t help improve profit or cash collection. This can include any unnecessary equipment and assessing if lay-offs are necessary to low performers in your team that aren’t willing to step-up and help your business get through these challenging times.
2. Cash flow
Cash Flow is king right now and in order to keep your business moving, now’s the time to check your books and go over what is owing and what you are owed. Redo your cash flow forecast on a weekly basis. How much working capital do you have on hand to cover your overheads? You should have a minimum of at least three months. Recession-proof your building company by implementing effective cash flow systems.
3. Conserve cash
Now is the time to conserve cash, wait before paying any big bills, invoices or long term debts you may have been considering paying off. Set aside cash that your business generates under a reserve fund and avoid any frivolous expenses. Wait to pay down big debts, large bills, etc. Conserve, Conserve!
4. Daily planning
Minimise negative emotions, such as fear and panic and implement more positive actions. Set up a daily routine i.e. meditation and exercise in the morning, 3 main goals in the day you must achieve and spending quality time with friends and family after work. If your mind is clear you can treat this like any other road bump that your business has faced and overcome.
5. Retain existing clients
Through an economic downfall, you need to find creative solutions that will install trust with your clients. Retain your existing and look for referrals by stepping up, communicating frequently and specifically on timeline, sub-trades, labour, materials and inspections in their jobs. Keeping your clients will also ensure your cash flow is consistent and stable.
6. Communicate regularly with your clients
With uncertainty and delays becoming more prominent it’s vital you communicate regularly with your clients over various platforms (text, email, Messenger, call, project management software) with updates on milestones, deadlines and current status.
7. Secure deposit before purchase
Make sure you secure all deposits for your materials before making purchases. The risk of clients being unable to pay increases with economic uncertainty. You don’t want to be left with missing pieces to the puzzle when completing a job so securing a deposit for your material or product will ensure you can progress with the next stages.
8. Audit job risk
Audit your risk on current jobs for time extensions and price increases due to disruptions and amend your future pricing and contracts. Doing a full audit will ensure that you’re following best practice and providing a safety net for your client, contractors and workers.
9. Change your marketing message
This is a sensitive time so make sure your messaging aligns with the current situation or can be of help. Over the next 90 days dominate with frequent (relevant) messaging. It’s time to lead! Remember, 10% of the fisherman catch 90% of the fish.
10. Update your online presence
With the current isolation rules in place, it’s never been a better time to have a strong online voice. Update your website and online marketing strategy so you can acquire more leads and be booked out 6 to 12 months in advance. There’s no reason why you can’t come out stronger after the next 90 days. Test and measure your leads from the last 12 months to now so you know which marketing strategies are working and which are not.
11. Regular team meetings
Now is the time to communicate regularly with your team so utilise the various remote conferencing platforms like Zoom, Google Hangouts or even just Messenger. Be clear about your expectations so your team knows what is required over the following days, weeks and months. Now’s the time to take control of your business and not only survive but thrive through this current situation!
If you’re serious about creating a building company that can be resilient and forward thinking in times like these, then download our COVID-19 Fast Action Checklist