Market Shake-Up Will Come – Graduate Summa Cum Laude

Here in the bay area commercial construction is booming. We are all busy to say the least! But now is the time to look ahead to what we can do to improve our ability to thrive during the eventual slowdown. We don’t know when it will slow but we know it will. Equilibrium is funny that way.

Here are 4 courses to ace now to graduate summa cum laude from the next market slowdown:


Prerequisite – First we need visibility – lets clean the windshield. How will you know if your market is slowing down? To perform well during the slowdown you’ll need to know that you are actually in one. What internal metrics do you currently track that will wave the caution flag giving you enough time to react? No internal metrics? Try tracking how many (and/or approximate dollar volume of) new project opportunities you have each month. Track the percentage of those opportunities you’ve won. Review the trend at least monthly. A drop off in any of these could signal the market is cooling off. If you use this metric remember to consider seasonality and bidder identity (which of your team members bid the projects and put numbers on the board).


Core Course – After we know the slowdown may have started you will want to respond quickly. Be able to move fast (without overreacting) by already having decided what you are going to do ahead of time. You need to agree on your defensive moves to best weather the slowdown. The faster you can react, ahead of your competition, the better off you will be. Make a prioritized list of what services and expenses you can axe. Same goes for personnel – which of your project managers, superintendents, estimators, laborers, and office staff will be less of an asset during the downturn. Trust your gut (but verify) who is going to cost you too much. The names that just popped into your head are the names that should go first. Don’t bleed money for months for someone you eventually decide to let go.


Elective Course – Conversely, know that there will be more good people than there are secure positions. Go on the offensive. Make your list of employees at other companies that you (should) have your eye on. Is there a player that has a solid relationship with a client you have been trying to do work for? Who do you bid against that, more often than not, wins the contract. Offer better job security than they perceive where they are now. If they are worth having, get them to the table.


Honors Course – What changes can you put in place right now to make your company more robust when it slows down? Identify those improvements and start working a plan to get them in place. Change your product mix (emphasis on maintenance contracts, etc.), get those master agreements and service contracts in place, promote and train your team (this will help keep other companies from taking your best people). Look at the number of primary sources of project opportunities. Start making the relationships now that you will need to increase that number. When things quiet down some of your sources of work will dry up. Start doing some extra credit work to have what you will need to thrive


We are having a fantastic ride in bay area construction. And we’ve been here before. It will eventually slow. Instead of fearing the inevitable, position your company to benefit. Make sure you have visibility of how your business is trending, make both defensive and offensive plans, and identify what to do now to benefit from the shake-up. Graduate from the next market cycle with honors.



For past articles and additional resources click HERE.

By Jonathan Walters with Crux Consulting, Inc. – Crux Consulting Inc. provides practical growth and success tools for general contractors and subcontractor trades in the construction industry. Want to know more? Contact via email at or go to


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