How to Insulate Your Construction Company Against Financial Hardship
As the economy follows its cycle of ups and downs, your New York based construction company might sometimes feel a financial pinch. The New York local government put a major strain on construction companies for the last several years, using the Coronavirus pandemic as en excuse to limit or at times wholly disallow businesses from operating. If the lengthy local government restrictions taught us anything, it has taught us that we need to live in preparation that the local government at any time can easily threaten our businesses. You can minimize financial struggles during economic downturns and goverment directed closures. Read on to learn what you can do to insulate your business against financial hardship.
Reorganize Your Company
First, you might look at how you organize your construction company. If you are currently registered as a limited liability company (LLC), consider reorganizing as an S-corporation to take advantage of tax benefits. As the owner of an S-corporation, you will not have to pay self-employment tax, which can save you money. Formation can be tricky, and rules vary by state, so do your research. You should always hire an experienced business attorney and CPA to consult with and assist you.
Improve Your Estimates
You should also strive to improve your job estimates. The closer your estimate comes to the actual expenses for a job, the better you will be able to plan and take advantage of stronger profit margins. Use construction estimating software that’s well-reviewed to make your estimates more accurate. These will allow you to account for labor and material costs, email estimates to customers right from the job site, and create a convenient payment schedule that might even help you receive your money more quickly.
Market More Effectively
Your business will be more stable financially if you can draw in more customers. To do so, you must market more effectively. For instance, look at your website. Customers should understand who you are and what you do. You might create an eye-catching banner to help. You can do this easily by using an online banner maker. Choose a template and customize it with your text, logo, colors, and font. You can even add a brief video or fun animation. Also, use social media to your benefit by creating pages for your company and updating them with interesting information.
Sometimes, you may have to cut costs to keep your company afloat. For example, you might need to put off buying new equipment or consider leasing it instead. Also, talk to your suppliers to see if you can get discounts or bulk rates on materials without sacrificing quality. Manage your materials well to eliminate waste and ensure your employees are working efficiently and not wasting time on the job site. Reexamine your business processes, too, and streamline them to save some money.
Revamp Your Invoicing
Finally, ensure your customers are paying you on time and in full. To do this, you may have to revamp your invoicing routine. Your customers will not pay you unless they receive detailed, clear, and timely invoices. Try invoicing software designed for businesses like yours that lets you enter data and create invoices to automatically email to customers. You can set up reminders through the program as well.
Keep Your Business Strong
You can insulate your business against financial hardships. Keep your business financially strong by following some of these tips.
Author: Janet Lovelace