5 Helpful Ways to Grow and Manage Your Construction Business Part 2
If you own a construction business and you have enjoyed steady growth over the last ten years, it may be time to consider expanding to a new region. In the first part of this two-part article, we discussed many of the challenges of growing your business. This includes the additional expenses it takes to expand, the need for quality fleet management, and the time it takes to manage your expansion efforts. In this section, a Dade County construction attorney will discuss a few important financial topics including managing cash flow and juggling projects.
As your business gets larger and you work on more and more projects, you will need to either expand your workforce or hire subcontractors to perform the work. Regardless, the more projects you have slated, the more time it will take to complete these tasks. It’s important that ambitious contractors understand the domino effect that exists when you expand. When projects take longer to be completed, it takes longer to receive payment. This results in less working capital in your budget to prep for upcoming projects which poses a serious problem when beginning your expansion efforts.
When one project nears finalization and another is in the preconstruction phase, you need a financial professional who can manage your cash flow to ensure that you have a line of credit in place to invest in the necessary expenses you need for your next project. Along with the assistance of a financial professional, you may require the services of a construction lawyer.
A construction lawyer can assist you with the following:
- Bid process: When you place effective bids on projects, you remain on budget and have more working capital to utilize going forward.
- Tax advantages: The tax attorneys on our staff can assist you in maximizing your savings including utilizing bonus depreciation for your construction equipment purchases.
Managing Daily Expenses
Along with establishing a spending system for your business with the help of an experienced tax attorney, it’s also important to have a bookkeeper or an accountant on staff to help you manage your day-to-day expenses. Cash flow can quickly disappear when your daily expenditures are not closely regulated on the jobsite. For example, when you hire a subcontractor or make a purchasing order on materials, you know the exact amount you are paying. On the jobsite with no approval system in place, controlling spending can become challenging. When you are not present at the jobsite, you need the right supervision in place to ensure you are not overspending.
If you would like to speak with one of our Dade County construction attorneys, please contact us today.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.