How to Manage Expenses For Your Construction Business During the Off Season
In some areas of the country, it is generally necessary to shut down your construction business for the winter season, because working conditions are so unfavorable. But that creates a problem for a business which still has expenses during the off season, and which still has employees to pay. Here are some tips on how to manage the off season for your construction business.
Establish a plan for cash flow
Especially in the first few off seasons of a construction business, cash flow may be a real problem, so having a plan to deal with that is essential. Your operating expenses will be much lower of course, so that’s one big help, but incoming revenues will also be way down, and at least some of that shortfall will have to be made up. Until your business becomes better established, it may be necessary to take out a business loan during the off season to bridge the gap until construction can be resumed in better weather. If a traditional bank loan isn’t available, alternative lenders may be able to help.
Diversify revenue streams
It can be damaging to your business to drastically cut down expenses in the off season to the point where even valued employees are laid off. When it comes time to gear up for the new construction season, those employees may be unavailable, so if it’s possible, adding other services to your business operation might be the answer. For instance, plowing snow, clearing off roofs, and doing interior renovations may all be options which you have the equipment for, and can provide services to customers for.
Create a flexible workforce
Rather than trying to go through winter layoffs and spring hiring cycles every year, it may be worthwhile to setup a flexible workforce for your construction business. Local high school or college students may be willing to work during summer months, and return to school in the fall, which is a fairly good fit for your off-season employment needs. It may work well to have some full-time employees and some part-time employees on staff, to make sure all off-season work can be managed, without over-staffing and over-paying. Some tasks like the company receptionist, might even be automated to reduce staffing requirements.
For more information on how Trihawk Capital can help your construction business in it’s off season, contact us at 732-784-1808.
