With volatility in the commercial construction market at an all-time high, trust is more important than ever.
It’s been nearly two years since COVID-19 became part of our vocabulary and changed lives all over the world. As life slowly returns to normalcy, people are excited to start construction projects that have been on hold for months. However, it’s not always that simple.
What’s going on in the commercial construction market?
With just a glance at a few trending headlines, you’ll quickly see that these are challenging times:
Skyrocketing steel, lumber costs threaten to slow construction jobs
Soaring material prices, supply chain delays spook owners and developers
CONSTRUCTION INFLATION ALERT
The construction industry is still reeling from the disruptions to the supply chain and the labor market. There’s a mad rush to get going on projects sidelined by the pandemic. Contractors are overwhelmed with calls, requests, and bids. However, there are significant barriers to moving forward with all these projects.
No industry has been spared from the challenges of hiring during our historic labor shortage. Many construction companies are increasing their wages to remain competitive in the hiring market. But nearly everyone is struggling to assemble the crews they need to get work done.
Fewer workers means longer project timelines and higher costs.
Additionally, material prices are in a state of constant flux. Because of unpredictable supply chains and limited availability, it takes much longer to procure materials. And what can be procured is much more expensive. Concrete prices are up and lumber costs have increased as much as 100% since 2019.
Contractors are having to redo bids from 2020 to reflect the escalating costs. People are frustrated by the price hikes and shopping contractors in search of a better deal.
Some have halted projects altogether because they can no longer afford it. In some cases, contractors are having to sacrifice profit margins to stay competitive.
Trust: the differentiator in uncertain times.
In a volatile, fast-moving environment, the pressure to act quickly can feel overwhelming. There’s hardly time to make informed decisions before circumstances change.
The best solution is to find one contractor you can trust, rather than starting from scratch on every project.
There are a few key elements of trust in this context:
- It may sound obvious, but you need someone who will tell the truth when it comes to their current capabilities. The last thing you need is someone making promises they can’t keep. Your contractor should tell it to you straight, even if it’s something you might not want to hear.
- You need someone you can trust to make fast decisions on your behalf. Things are changing so fast right now, there’s not always time for drawn-out analysis. If you trust your contractor to represent you, they can seize openings and lock in good prices for you. A good contractor will have the knowledge needed to make smart judgment calls and act fast. This also saves you from the stress of making decisions under pressure yourself.
So, how to find a trustworthy concrete contractor?
In a previous post we shared some tips for spotting a good concrete contractor and offered the following due diligence questions.
Ask your prospective partners:
- How long have they been in business?
- How would they handle a redo? What’s the process? Can they offer an example of a recent instance?
- What’s their process for maintaining quality standards on the specific work you need done?
- Are they and their vendors insured?
- How long have they been working with their vendors?
- Do they have a good grasp of the plans and drawings?
But even if you don’t choose FraserCon, we encourage you to look for experienced partners with great reviews.
Experience is king when margins are as tight as they are now. Make sure you find someone who knows what they’re doing.
FraserCon has been in business since 1998. We’ve experienced fluctuations in the industry before, and we can guide you through this season of uncertainty. If you’re ready to talk about your next project, get in touch.