Branch Out Into New Types of Projects
We are in the middle of a time of rapid growth in the construction industry. From our unique perspective, a hot market is the perfect environment for construction companies of all sizes to take a step back, get a sense of the big picture, and strategize how to grow by branching out into new types of projects.
During the last recession your company may have focused on only one one type of project because that was the only option. However in today’s market, with so much more demand for new construction across sectors, it is much easier to start branching out and getting into other types of work. Now, you might have six different types of projects you could build. Your company may be building more big box retail than you have ever built before, but that doesn’t mean that big box retail has to be your only focus forever. It is true that you might get a lower return and larger ramp-up when building new types of projects, but now is the time to take on those new opportunities to begin broadening your portfolio.
Entering into new sectors or segments can set your company up for stability when the market begins to get colder again (as it inevitably will), and it can help you maximize your future profitability and growth. Not taking steps toward diversification can be just as risky, or even riskier, than taking on new types of projects. When the last recession hit, we saw many contractors who had a narrow focus basketball-weddingstumble, while those who had multiple project options were better able to weather the storm.
At the very least, if you only build one type of project, then you are cutting yourself off from a lot of opportunity. Do not get so caught up in your company’s current projects that you cannot take the time to see the big picture or make a new roadmap to greater success. Deliberate and calculated diversification is smart growth.