Skip to content
Business Plan

Business Plan

Business Reopen

Primary Menu Business Plan

Business Plan

  • Business Finance & Support
  • Business Plan
  • Their Business
  • Business & Finance News
  • Wealth Business
  • Financial Function
  • About Us
    • Advertise Here
    • Contact Us
    • Privacy Policy
    • Sitemap
  • Their Business

4 Ways General Contractors Can Increase The Value of Their Small Business

Linda Caughey July 6, 2022

By Chris Giambrone, CFP

As a construction pro, you’re a master at building or improving properties for your customers. But as a business owner, are you just as focused on building a successful, sustainable business model for your future buyer?

When you first started your business, you probably weren’t thinking about the day you might sell it to someone else. But now that thoughts of retirement have entered your mind, it’s time to begin planning your exit strategy more seriously.

Chris Giambrone is a co-founder of CG CapitalTM, a boutique wealth management firm based in New Hartford, N.Y.  He is a CERTIFIED FINANCIAL PLANNERTM and Accredited Investment Fiduciary®(AIF®).  Chris has also earned a Certificate in Retirement Planning from the Wharton School of Finance at the University of Pennsylvania.

Chris Giambrone

One of the most important parts of that exit strategy is increasing the value of your business to make it more attractive to potential buyers. 

With that in mind, below are four ways general contractors can increase their business value to attract potential buyers and garner an attractive price:

1. Attract & Retain High-Quality Talent

When buyers acquire a business, they want a smooth transition. If your key workers are highly skilled, trained, and professional, that’s a green flag for prospective buyers. Happy, committed employees indicate that your company culture is strong and your internal processes run like a well-oiled machine.

One of the first steps you can take toward increasing the value of your business is to take inventory of what you offer as an employer and make improvements if necessary. Current industry problems, such as shortages of general labor and skilled workers, are likely to continue. While this is surely a challenge, it’s also an opportunity to make your business stand out.

There are several ways to bring in and keep top-tier workers. One of the easiest, of course, is to promote your superstars from within and offer opportunities for advancement to current employees. Implementing these promotions now will give you a head start on preparing your key workers for future transitions.

Additionally, if you’re struggling to attract new hires (which wouldn’t be a surprise in today’s labor market), consider how you can increase your company’s appeal. Paying competitive wages is important, but it isn’t the only way to attract new talent. You might also improve your company’s safety standards, benefits package, or opportunities for further education.

Ultimately, think about what today’s talent is looking for in their career and how you can match their expectations and desires. Building a strong, reliable team will make your business stand out to potential buyers, as they won’t have to come in and completely overhaul after your exit. (Plus, this benefits the employees you care about as well!)

2. Specialize Where Possible

Businesses that specialize in one way or another may also stand out more to prospective buyers. By concentrating on just a few core work areas or committing to a specific company value, you can fine-tune your craft and develop a niched team of professionals.

Specializing may allow you to raise your prices, enjoy greater profits, and even develop a stronger community presence, ensuring the longevity of your business. All of these things are particularly attractive to prospective buyers.

When niching down, consider consumer and industry trends that may be attractive to your community and buyers. For example, becoming an environmentally-conscious construction company is one way to set your business apart from others and demonstrate commitment to a core value. Alternatively, identifying a unique need in your community, such as lakeside landscaping architecture as an example, is another opportunity for specialization.

Once you’ve done this, you’ll be able to prove to prospective buyers why and how your business is built for long-term success in your community.

3. Master Your Cash Flow

Cash flow constraints can be particularly problematic for general contractors and construction companies, especially contractors who are rapidly taking on new work. These individuals are more prone to the risks of negative cash flow. As a result, it’s essential that you address any cash flow issues before it’s time to put your business on the market.

Cash flow issues can come from a variety of sources, including time lags between sending invoices and collecting payment, sending advance payments to suppliers, overstocking inventory, and project delays. You’ll need to discover which are affecting your business the most and address those problems accordingly.

Mastering your cash flow may involve establishing a (better) credit line with a bank, decreasing tax liabilities, or improving the accuracy of your forecasting and budgeting. Working with an advisory firm that understands the unique challenges faced by general contractors can help you take control of your cash flow with more confidence.

4. Streamline Work Processes

The world of general contracting can be a hectic one. Between hiring reliable subcontractors, paying workers, keeping track of equipment, and adapting to supply chain problems, it’s easy to become overwhelmed by obstacles. That’s why your processes need to be streamlined to address potential challenges before it’s time to sell your business.

If you want to increase business value, you need to increase productivity and decrease inefficiency. Since time is your most valuable resource, identify the areas where time is being used inefficiently. Then, seek technological or outsourced solutions to get that time back. Below are examples of ways to get started streamlining:

  • Project Management Technology: To streamline your processes, take advantage of technology that’s been specifically designed to help general contractors stay on top of their projects. Softwares such as Buildertrend or CoConstruct can help contractors create detailed estimates, schedule jobs, and send invoices — all from a single platform.
  • Outsource More Functions: As a general contractor, you’re a master of DIY. But when it comes to running your business, DIY isn’t always the best option — especially when you’re looking to sell your business. If tasks such as scheduling jobs, sending out payment reminders, or filing taxes are taking up too much of your bandwidth, consider outsourcing these tasks to a pro who can take them off your plate.
  • Improve Communication: Team members have to be on the same page. If they aren’t, projects are subject to turbulence and delay. Depending on your business, you might consider improving on-site management, communication systems, or defined worker expectations.

Streamlining these different workflow processes will make any transition easier on a buyer — and will make your company all the more attractive when it comes time to negotiate the value of your business.

Now, Create a Business Exit Strategy

It’s normal to feel overwhelmed when the selling of your business is in sight and retirement is near. But entrepreneurs who fail to act strategically risk trying to sell an efficient, low-value business — with long-term consequences for their retirement.

Business buyers want to see companies that are adaptable, scalable and offer an easy transition. And they’re willing to pay more for companies that meet these expectations. For these reasons, it’s paramount that you stay focused on increasing the value of your business.

By investing time to increase your business value, you can set yourself up for success not only in selling your business, but also in building your wealth.

About the Author: Christopher C. Giambrone, CFP®, AIF® 

Chris Giambrone is a co-founder of CG CapitalTM, a boutique wealth management firm based in New Hartford, N.Y. He is a CERTIFIED FINANCIAL PLANNERTM and Accredited Investment Fiduciary®(AIF®). Chris has also earned a Certificate in Retirement Planning from the Wharton School of Finance at the University of Pennsylvania.

Branch Address: 139 Genesee Street, New Hartford, N.Y. Securities and advisory services offered through Commonwealth Financial Network, Member FINRA/SIPC, a Registered Investment Adviser. Branch Phone Number: (315) 765-6032.


You May Also Like…

Other relevant articles from Retirement Daily 

5 Questions to Ask Yourself Before Exiting Your Business

small business thumbnail

If you’re thinking about exiting your business, asking yourself these five questions can help set you on the right path.

The Three Phases of Retirement

My project

The three phases of retirement impact our desires and finances. Here’s how to make the most of each phase.

4 Retirement Challenges Small Business Owners Face

retirement thumbnail

Saving for retirement can be tough, especially for small business owners. But you’re even tougher. Here are four retirement challenges and how to approach them.

Top Tax Write-offs for the Self-Employed

Taxes thumbnail

Whether you do contract work or have your own small business, tax deductions for the self-employed can add up to substantial tax savings.

Tags: Amazon Business Credit Card, American Airlines Business Class, Att Business Login, Austin Business Journal, Best Bank For Small Business, Best Business Bank Accounts, Best Business Schools In Us, Best Business To Start, British Airways Business Class, Business Attire Men, Business Card Ideas, Business Casual Shoes For Women, Business Continuity Planning, Business Entity Search, Business Letter Template, Business Management Degree, Business Manager Facebook, Business Plan Outline, Business School Rankings, Colorado Business Search, Delaware Business Entity Search, Drop Shipping Business, Family Business Bet, Fox Business Live, Georgia Sos Business Search, Google Business Account, Harvest Small Business Finance, How To Build Business Credit, Is Saturday A Business Day, Is Sears Still In Business, Microsoft 365 Business, My Business Google, Name Generator Business, None Of Your Business, Ny Sos Business Search, Open A Business Bank Account, Pa Business Search, Plus Size Business Casual, Pnc Business Banking, Sos Business Search Ca, Sunbiz Business Search, Taking Care Of Business, The Business Of Being Born, Turbotax Home And Business 2020, Tx Sos Business Search, Venmo For Business, Verizon Business Plans, Virtual Address For Business, What Are Business Days, Women Business Casual

Continue Reading

Previous Get the Most Out of a Smart Landing Page Builder—Just Like This Business
Next 5 Simple Tips for Marketing Your Brand On Clubhouse

More Stories

Create Time, Reduce Errors and Scale Your Profits with Proven Business Systems -
  • Their Business

Create Time, Reduce Errors and Scale Your Profits with Proven Business Systems –

Linda Caughey June 8, 2023 0
man in a wheelchair holding a computer tablet
  • Their Business

Client Onboarding Checklist for Agencies

Linda Caughey June 8, 2023 0
Channel99 will help marketers measure the performance of channels and vendors
  • Their Business

Channel99 will help marketers measure the performance of channels and vendors

Linda Caughey June 4, 2023 0
June 2023
M T W T F S S
 1234
567891011
12131415161718
19202122232425
2627282930  
« May    

Archives

  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • November 2018
  • October 2018
  • December 2016

Recent Posts

  • Create Time, Reduce Errors and Scale Your Profits with Proven Business Systems –
  • Client Onboarding Checklist for Agencies
  • How 25 Side Hustlers Made Their First Entrepreneurial Income
  • Marketing Analytics: Attribution Is Not Incrementality
  • Why Emotional Marketing Beats Promotion By 2X

BL

Tags

Amazon Business Credit Card American Airlines Business Class Att Business Login Austin Business Journal Best Bank For Small Business Best Business Bank Accounts Best Business Schools In Us Best Business To Start British Airways Business Class Business Business Attire Men Business Card Ideas Business Casual Shoes For Women Business Continuity Planning Business Entity Search Business Letter Template Business Management Degree Business Manager Facebook Business Plan Outline Business School Rankings Colorado Business Search Delaware Business Entity Search Drop Shipping Business Family Business Bet Fox Business Live Georgia Sos Business Search Google Business Account Harvest Small Business Finance How To Build Business Credit Is Saturday A Business Day Is Sears Still In Business Microsoft 365 Business My Business Google Name Generator Business None Of Your Business Ny Sos Business Search Open A Business Bank Account Pa Business Search Plus Size Business Casual Pnc Business Banking Sos Business Search Ca Sunbiz Business Search Taking Care Of Business The Business Of Being Born Turbotax Home And Business 2020

Visit Now

Xtreme Free Games

pest control las vegas scorpion 

getlinko

Related Article

Create Time, Reduce Errors and Scale Your Profits with Proven Business Systems -
  • Their Business

Create Time, Reduce Errors and Scale Your Profits with Proven Business Systems –

Linda Caughey June 8, 2023 0
man in a wheelchair holding a computer tablet
  • Their Business

Client Onboarding Checklist for Agencies

Linda Caughey June 8, 2023 0
How 25 Side Hustlers Made Their First Entrepreneurial Income
  • Business Plan

How 25 Side Hustlers Made Their First Entrepreneurial Income

Linda Caughey June 7, 2023 0
attribution_paid_search
  • Business Plan

Marketing Analytics: Attribution Is Not Incrementality

Linda Caughey June 7, 2023 0
man laughing and crying
  • Wealth Business

Why Emotional Marketing Beats Promotion By 2X

Linda Caughey June 7, 2023 0
fit-body-24ua.xyz | CoverNews by AF themes.

WhatsApp us