When it comes to construction entrepreneurs, and especially homebuilding entrepreneurs, there are two types "the quick, and the dead." Both interpretations of this quote are equally applicable. In the King James Acts 10:42 Jesus is depicted as the judge of the quick and the dead, that is those who are alive (quick) and those that aren't. In this case, the economy is the judge of the quick and the dead.
We will spend decades learning from the mistakes of those run bankrupt and the good fortune and wise direction of those prevailing in this economy. One of the common threads that will be found in those that survive is their flexibility, their ability to maneuver "quickly" which brings us to the second translation of the "quick and the dead." In swordsmanship as well as martial arts, the difference between emerging the victor and not emerging at all can be a difference in reaction time of milliseconds. Their success is also greatly attributed to the ability to follow a given set of standards while simultaneously being innovative enough that the opponent cannot predict their next move. If you watched Mariel Zagunis beat Sada Jacobson in the 2008 Olympic Sabre event, you could see how Zagundis invited Jacobson to attack by dropping her sword while simultaneously stutter stepping toward Jacobson. Jacobson held her sabre out in front while retreating as far as the warning track. Invariably, Zagunis scored a subtle touch in the side of Jacobson with such swiftness; it is hardly perceptible on slow motion replay. In order to remain among the quick, businesses must swiftly review their business plan (or write one) locating any weaknesses not shored up and exploring their strengths in the context of today's economy, not last years.
In other words, what may have sounded like a ripe market segment last year may well have dried up today. It may be time to look to use resources in normally unconsidered areas. Some contractors are leveraging their satisfied customers to secure renovation contracts. Others are pursuing other market strata altogether. One of the potentially overlooked possibilities may be government contracts. Of all the jobs a contractor has ever had to bid on, perhaps government contracts are the ones with the most detail going in. This can be good and bad. If your firm is used to bidding a homeowner's dream house at a nice round $xxx per square foot, the necessary details of bidding government contracts may appear intimidating. On the other hand, if you are capable of reporting your variance on any given job today, it may not seem like that much trouble. Here's a couple things to consider:
If you have never done work for the city, county, state, or federal government, you will need to get registered. Every entity has its own rules. But be prepared to answer a lot of questions about your finances, past projects, and diversity within your organization. Once you have registered, there is a (small) chance you may be contacted directly to bid on projects. More than likely though, you will need to find out where they post new opportunities and monitor the list yourself. Also, be prepared to buy bonds, not the good kind where you make money, but surety and bid bonds.
Next, the government loves small businesses (for most things). If you are a custom builder, you are most likely a small business. When you bid, there is a significant amount of small business recordkeeping involved. Remember to be diligent from the beginning of the process all the way through. The last thing you want is to lose a bid because govco asks for detail and you don't have it. Don't worry, they already have a form for everything. And in the spirit of efficiency and 21st century technology, everything is hand written on photocopied forms.
The good news is low bid wins unless they get themselves disqualified. It is imperative to know and follow all due dates. For instance, if bidding on a project is due September 15th and today is September 1st, you may not even be able to bid the job because there was a mandatory pre-bid conference two weeks ago. The other good news is govco pays.
So if you are in the process of dusting off your business plan looking for answers, try googling small business and your municipality and make a few calls. It could be the start of a beautiful friendship.
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