As a business owner, you’re responsible for every aspect of your company. Keeping track of every invoice, managing supply chains, and monitoring the books can be challenging. However, a well-organized business will help you make important decisions faster and understand the impact of your actions. If you’re a trade contractor, small business management might not seem like an obvious priority. After all, building houses is what you love to do!
However, without effective management, your contracting business won’t last long. Fortunately, there are many proactive steps that you can take to manage your business and financial risks as a contractor. If you’re struggling with organization or feel as if your contracting business is falling apart, read on for effective ways to improve your management abilities and keep things running smoothly.
Have a Weekly Planning Session
As a contractor, your work is subject to the whims of your clients. What if the next job doesn’t come in? Or if the client decides to change the scope of the project in a significant way? You’ll need to have a set of contingencies in place so that your business can survive and thrive. In order to do this, you’ll need to have a weekly planning session where you focus on the following:
What work is in the pipeline?
What work has been awarded?
How much does each job pay?
What are the due dates for each job?
What are the contractual obligations for each job?
What are the materials and resources requirements for each job?
What are the potential problems and issues on each job?
How much cash will you have next week?
Run a Risk Management Program
When managing risk, you’re focusing on identifying and minimizing the threats to your business. You’ll need to ask yourself questions like:
What could go wrong? What are the financial risks of each project?
What are the reputational risks?
What are the technical risks?
You’ll also want to keep track of risk ratings for each project. You can use a simple scale such as 1-5 (with 1 being low risk and 5 being high risk). This will allow you to focus on the issues that matter the most. You’ll also want to keep track of potential solutions for the issues that you identify.
This way, if you notice an issue on a project, you’ll be able to refer back to the issue and potential solution at a moment’s notice. This will help you take action immediately and solve problems as soon as they crop up.
Monitor Your Employees
As a contractor, you’re responsible for managing your own performance. However, you’ll also likely have employees working for you—whether it be part-time workers or full-time staff. When hiring, you’ll want to focus on careful selection. You’ll want to make sure that you hire only the very best candidates—after all, they’ll be an extension of your brand!
Additionally, you should confirm that an employee handbook is already in place. This will make it easier for you to guarantee that each employee is aware of their responsibilities and what to anticipate from you as the business owner. Setting expectations will prevent unpleasant surprises. Also, it will assist you in maintaining structure and achieving staff performance targets.
Use a calendar to organize your workflows
One of the most efficient methods to stay organized is by effectively managing your time. A calendar is a great tool for managing your time. It allows you to see exactly how you’re spending your day so that you can make adjustments where necessary. You can use a calendar to schedule important tasks, track your daily goals, and plan social activities.
Plus, having a visual overview of your schedule will help reduce stress and improve your overall well-being. There are lots of different types of calendars you can choose from depending on your preferences. You can find paper, electronic, and even app options to suit your needs. It’s also a great place to keep track of appointments, meetings, and due dates so that you never miss anything important.
Monitor cash flow and contractual obligations
The most important aspect of managing your business is understanding the financial realities of your work. You need to know exactly how much profit you’re making and how long it’s going to take to pay off your bills. You’ll want to keep track of your contractual obligations. This will allow you to stay organized and make sure that you finish your work on time and to the correct specification. It will also allow you to prepare for potential delays.
Negotiate better contracts with suppliers
You’ll want to pay close attention to your procurement process. Your suppliers are critical to keeping your business afloat. They provide the materials that you need to build your projects. You’ll want to negotiate better contracts with your suppliers.
This will allow you to get better pricing and make sure that you stay competitive in your industry. You’ll also want to pay your bills on time. Paying on time will help you avoid damaging your reputation with suppliers and give you leverage with contractors who are behind in paying you.
Track Staffing and Payroll Effectively
Tracking your staffing levels is critical to keeping your business afloat. You’ll need to make sure that you have enough employees to handle the work and no more. Keeping track of this will allow you to respond to changes in demand. You’ll also want to keep track of employee hours. This will allow you to ensure that you’re paying your employees fairly and that they’re not exceeding their hours. It will also help you understand when you’ll need to hire more employees.
You can track this information in a basic spreadsheet. More robust software is also available, but it’s best to start simple and then add more functionality as you get more comfortable with keeping track of your business.
Utilize the Equation for Risk Management
Risk is an ever-present issue in business. You’ll want to keep track of the risks that you take on a daily basis. You can utilize the equation for risk management to keep track of potential issues and how you’re dealing with them. Simply keep track of issues that arise in a risk log. As you log issues, make sure that you add the following:
Take Advantage of Technology
As a contractor, you’ll be managing a lot of different workers and projects. You’ll need to keep track of everything and communicate effectively with your team members and clients. You can take advantage of technology to make your management tasks easier. You can choose from a number of software solutions that will help you track your time, optimize your workflow, and keep track of your finances.
Bottom line
Large-scale projects are complicated and require effective management. If you want to be a successful contractor, you’ll need to keep track of your workflows and all of the issues that arise throughout the process. You’ll also need to communicate effectively with your team members and clients so that everyone stays on track and the project is completed on time and to the correct specification.
You must keep track of everything if you wish to become a productive contractor. You should keep a record of the problems you encounter, the fixes you implement, and the advancement you achieve on each project. With the right organizational and management techniques, you’ll be able to keep track of everything and thrive as a contractor. Visit SYP.net to learn more about how to effectively take care of all your business-related needs.