There are many educational paths to working in construction, and apprenticeships can be a popular one. The concept of the apprentice is hundreds of years old, presuming that people who wanted to take up a particular trade would study under an expert for years. At the satisfactory conclusion of the apprenticeship, the apprentice would have the skills they need to move into their careers. Here are a few things you should know about construction apprenticeships.

Why Does Construction Offer Apprenticeships?
If you’ve worked in other industries, you might wonder why apprenticeships are much more common in construction. There are many industries in which you can learn everything you need to know simply by doing the job. In others, you might need to pursue a college education in order to get the foundation you need to qualify for the job. Construction is a little different. In this industry, workers can often start doing the most entry-level tasks with relatively little instruction. Over time, they need more support and training to be able to do the work correctly and safely. Apprenticeships are a great way to get that training in a supportive environment, without having to work for free.

How Does an Apprenticeship Work?
If you’re familiar with the concept of internships in other industries, it may be easier to understand how a construction apprenticeship works. Apprenticeships are paid positions, and they usually involve working with a specific company. You have to apply for the apprenticeship, and depending on how popular it is, it may be difficult to get one. The company pays your wages while you are in the apprenticeship, although they may get some of that funding from government grants. During the apprenticeship, you receive on-the-job training and support from a qualified mentor. By the end, you may receive a certification or meet most of the requirements you need to apply for a contractor license.

What Are the Basic Qualifications for an Apprenticeship?
Apprenticeships may have a variety of qualifications. It all depends on the particular job, so it’s a good idea to investigate and make sure that you can meet the requirements before you apply. As a general rule, you can expect these qualifications:

• At least age 16, or 18 for certain jobs
• High school graduate or appropriate alternative
• Ability to do all the tasks that the job requires
• Residency in the region, or a willingness to relocate

In some cases, you may need to have a certain amount of experience in the industry or additional training.

How Does an Apprenticeship Compare to College Education?
In many ways, apprenticeships are comparable to a college education. For example, an apprenticeship gives you access to experts in the field who can teach you and guide you through the tasks, not unlike a college program. Some apprenticeships can last for several years, approaching the length of a four-year college program. In some cases, you can even get college credit for completing an apprenticeship, although that’s heavily dependent on the individual program and school. The biggest difference is that you don’t generally get paid to get a college education, while an apprenticeship usually does provide some kind of stipend.

How Can People Find Available Apprenticeships?
The availability of apprenticeships depends a lot on the area you live in and the field you’re looking to go in. If you’re interested in applying for an apprenticeship, you can search online for options close to you. You may be able to locate them through job-posting websites, or from listings tied to local trade organizations. If you don’t find what you’re looking for, keep searching. The availability of apprenticeships may not follow a typical calendar or school year, as it depends on the company offering it.

An apprenticeship might be a way to jumpstart your construction career. For more information about what you’ll need to become a licensed contractor, contact CSLS today!

When property owners look for a contractor for a project, they are often searching for the lowest price. So it’s not entirely surprising that, on occasion, you might interact with a property owner or a contractor who reveals another contractor’s bid in an effort to get you to lower yours. This concept is known as “bid shopping,” and it is illegal in certain contexts. By understanding it, you can have a better chance of avoiding it.

What Is Bid Shopping?
It’s common for property owners to ask for lots of companies to bid on a project, so that they have various options. This is not the same as bid shopping. When a general contractor is looking for subcontractors for their own bids on a project, they might publicize the bids that they are receiving in the hopes that subcontractors will offer to do the work for a lower price. Bid shopping essentially encourages other contractors to lower their prices in an attempt to secure work.

What’s Wrong With Bid Shopping?
If you have ever done comparison shopping or asked a company to match the price that a competitor is offering, you might wonder what is wrong with bid shopping. As a contracting business owner, you may quickly understand how bid shopping can create significant problems within the industry. There’s already a lot of pressure for small businesses to compete with larger ones by lowering their prices and cutting into their profit margins. Bid shopping can create a “race to the bottom” mentality where the lowest price becomes the biggest factor for general contractors or property owners to determine who gets the bid. If you’re constantly having to cut your bid to meet the lowest price, you may eventually end up losing money on projects.

What’s the Difference Between Bid Shopping and Bid Peddling?
The difference between bid shopping and bid peddling is the person who is doing it. Bid shopping usually involves a general contractor or property owner looking for lower bids from subcontractors. Bid peddling comes from a subcontractor offering lower prices than another subcontractor in the hopes that they can supplant that subcontractor for the same job. Both actions can be sneaky and unethical, they just come from different directions.

Is Bid Shopping Illegal?
In many cases, bid shopping is illegal. In fact, California state law requires that for public projects, contractors have to publish a list of the subcontractors whom they would hire to complete the work for the project. With a few exceptions, this law makes it much harder for contractors to substitute a lower-bidding subcontractor on a whim. Outside of this context, however, it may not be illegal. It’s worth keeping in mind that most professional organizations in construction dislike the practice, mostly because it kills profit margins and makes it more difficult for businesses to thrive in a competitive environment.

What Should I Do If I Encounter Bid Shopping?
Although bid shopping is often illegal and generally looked down upon, you may still encounter it on occasion. The best thing you can do is to understand the laws for submitting bids to a contractor. If there’s a contractor in your area who you find is trying to push the envelope to see what they can get, try to avoid doing business with them in the future. Ask your lawyer about adding clauses in your contracts to protect the confidentiality of your bid. You won’t be able to get rid of bid shopping entirely, but you can establish yourself as an above-board contractor who prizes a healthy industry. You’ll be able to build more credibility with that view anyway.

Bid shopping is a problem in construction, but if you know what to look for, you can generally avoid it. For more advice about getting started in construction, visit CSLS today!

When you start researching the various things you need to start a contracting business, you might be surprised by the simplicity. In fact, you don’t need a degree in business or years of experience handling money to get started. But there are a few things that you should make sure you’ve done before you open. Keep these five things in mind.

Find Your Target Market
Once you start your business, you’ll be eager to build a steady stream of new customers. But before you can do that, you need to figure out who your target market is and how you can find them. You can search online to determine which people are most likely to need your services. Then, you can do more research to learn how they find businesses like yours when they need one. This step is not as simple as it looks. You might need a month or two to get answers to these questions. The good news is, you’ll have a much better chance of securing clients once you know where they are.

Figure Out Your Funding Options
People who start a small business often rely on a variety of types of funding, including:

• Personal savings
• Gifts or donations from family and friends
• Crowdfunding
• Credit
• Business loans

The amount of money you need depends a lot on the type of services you’re going to provide. For example, if you’re planning to focus on home repairs, you might not need as much as you would if you want to become a builder of new construction. Research your options and how to apply for different kinds of funding. That way, you’ll be prepared once your business is ready to go.

Make a Plan for Advertising
Construction professionals often rely on word of mouth to get new clients, but you may not want to make this your only option. You don’t need to have a hugely expensive or complicated marketing strategy, but you should probably have something. Think about how you would like people to find out about your business, whether that’s an ad in the local newspaper, online advertisements, or even your business’s name on your vehicle. Get a sense for what you can expect to pay for advertising so that you can budget for it once you have some funds to work with.

Research Rules for Starting a Business
Every state has specific rules that you have to follow when you want to start a business. Your city may also have guidelines that you need to obey as well. In order to get a license, you usually need to pick a business name that is unique and pay a fee in order to get your license. As a general rule, you should plan to maintain a business license, even if the business name is your own name and you’re planning to operate as a sole proprietor. If you decide to create an LLC or a corporation, you’ll need to follow those rules as well.

Prepare for the Contractor Licensing Exam
If you haven’t taken the contractor licensing exam yet, you’ll need to do that before you can open your contracting business. Keeping a current license shows your clients that you are committed to performing professional work that will provide a good investment for them. One of the best ways to ensure that you can pass the contractor licensing exam is to complete a course of preparation in advance. Exam preparation helps you understand what you can expect on the test and confirm that you have the right knowledge to get the desired result.

Starting your own contracting business might be a dream that you’ve had for years. If you do these things beforehand, you’ll have a good sense of where to go next. To get started, visit CSLS today!

Marketing is one of the best ways that customers can find you. But if you’re not investing time into it, you might find that you’re not getting a very good return. It’s tempting to set up your marketing and hope it will run by itself, but without occasional changes, sometimes you get stuck in a rut. Here’s how you can get out.

Get Data on Your Marketing Efforts
The first thing that you need to do is figure out what is working and what isn’t. In many cases, business owners start to gather data on their marketing strategies and discover that only some of the parts aren’t working. For example, your marketing might be driving lots of people to your website or your social media, even if it doesn’t lead to conversions. You don’t want to drop the first in favor of the second. There are a handful of free data-collection services that you can take advantage of, but it may be worth investing in a paid version that provides detailed insights that you can use to tweak your strategy.

Rethink Your Marketing Approach
There are a few things that you should know about marketing, including the fact that the most popular approaches change on a regular basis. This means that if you are taking marketing tips from five years ago, or even ones from last year, they may not be very relevant today. Regardless of your clientele, you’ll probably need to do more than rely on word-of-mouth or minimal advertising. This will likely require you to invest a bit more, usually in the form of money but also time. The good news is that trying out new methods gives you more information to make your marketing work more efficiently.

Look for New Sales Channels
In order to tailor your marketing strategy, you need to consider all possible sales channels for your business. The right ones depend on the type of business that you do. For example, if you work primarily with non-business clients, you might want to market your services directly or through an intermediary. An intermediary is a company that offers an auxiliary product or service through which you may be able to secure new customers. If you’re having a hard time getting clients by marketing to them directly, this may be a practical approach.

Try New Advertising Formats
Marketing may seem like one of the driest, most boring aspects of running a business. But it doesn’t have to be. In fact, improving your marketing and sales can sometimes be much more interesting and engaging than you expect. If you’ve gone through traditional advertising approaches and you’re not getting a big return, there isn’t much risk in trying something completely new. Create a YouTube channel with tips for consumers. Market your business on TikTok. We might be surprised how many new prospective customers you find.

Create Customer-Focused Marketing Plans
In some ways, marketing may be simpler than you think. Realistically, your primary goal is to ensure that your marketing efforts reach the customers most likely to pay for your services. This means you have to figure out where they spend their time and how your advertising can reach them. Keep in mind that the type of advertising depends on where prospective customers are in the decision-making process. If you focus too much of your advertising on discovery and not enough on persuading them to hire you, you might have leads but no sales. If you spend too much time pushing them to choose you, they may feel overwhelmed and back away. Plan to formulate different types of marketing and make sure that you’re covering potential clients at every stage of the process. That way, they won’t feel like you’re drowning them or leaving them out in the cold.

Changing up your marketing strategy is a great way to get out of a rut and get more sales. First, you need to be a licensed contractor. To find out how expert exam preparation can help you, contact CSLS today!

On a regular basis, you may need to work with other professionals who aren’t clients, employees, or subcontractors. For example, you may need an inspector to provide approval before you can move on to the next stage of construction. These interactions can be simple and quick, but sometimes they’re full of conflict. The good news is that most of the time, they don’t have to be difficult. Here are a few ways you can navigate it.

Do Your Research
Part of running a contracting business involves knowing when you have to hire or schedule other professionals outside of your company to perform work. After a few years, this may feel like second nature, but it’s always good to follow up and make sure that the guidelines you remember are still current. Researching in advance is a great way to avoid conflict because you will already know your obligations and rights. You have probably had experiences where someone you were working with failed to investigate what they needed to do for a particular task and tried to make it your problem when you corrected them. Thankfully, this is easy to avoid.

Stick to the Schedule
As a business owner, you know what it means to keep your commitments. You have to run a reasonably tight schedule, otherwise, you can fall behind and disappoint your clients. Other professionals are often in a similar situation. If you need to have somebody from a utility company identify lines or access points, you may have to schedule a time to allow them onsite. And just like you, they probably have other commitments that they need to meet as soon as they’re done with your task. Keeping track of the time and ensuring that you are ready to meet them at the designated appointment helps everybody to move forward.

Offer Professional Courtesy
When you have a frustrating interaction with someone in a professional capacity, it’s tempting to blame them for having a bad attitude. But in reality, it’s much easier to offer professional courtesy and, if nothing else, the benefit of the doubt. It’s true that people can have a bad day and take it out on others who are completely uninvolved. This isn’t a good professional behavior, but it happens. In many cases, you may have to interact with third parties repeatedly, to the point that you know each other by name. Offering everyone a basic level of kindness will help to relieve a lot of the stress present in the situation.

Keep Interactions Simple
Most of the time, someone who arrives to inspect your site or mark utility lines isn’t looking for a long, drawn-out process. This is fortunate because like you, they just want to finish this step and keep moving. If the result of the meeting isn’t what you were hoping for, you may find yourself trying to drag it out in hopes of a renegotiation. In that case, you’re unlikely to get what you want. Start with the assumption that you will allow them to complete the task fully, even if that includes time afterward to prepare a report and submit it. That way, you can get all of the information without rushing them or causing an argument.

Maintain Contacts
Sometimes, you will need to follow up with third parties to get more information about the task or the results. The last thing that you want is to contact a large organization with no information about the person who just completed the work. When someone arrives onsite, confirm that you have their name and basic contact information. Check to see if the phone number they provide leads directly to them or to an operator. With these details, you’ll have an easier time following up as needed.

Interacting with other construction professionals is a common part of your contracting business. Once you get your license, you can start building that experience. To learn more about expert exam preparation, visit CSLS today!

When you’re getting ready to take the contractor licensing exam, you may wonder if it makes sense to sign up for expert preparation for the test. It’s tempting to think you can save the money, but you could be making a big mistake if you do. Test preparation is more than simply reviewing concepts. It also helps you know what you can expect during such an important task. Here are five reasons you’ll be glad you made the investment.

You’ll Know What to Study
When it comes to preparing to be a licensed contractor, there are many subjects that you will have to master. But in order to pass the exam, you need to understand how the test works as well. There’s no point in investing all of your time into specific subjects that don’t tend to get a lot of coverage from the test. Additionally, it’s a good idea to have a sense for what you will need to know in order to pass it. Exam preparation isn’t a replacement for the years of knowledge and experience you’ve developed for each subject. It simply refines your expertise in a way that will make you more successful once you get your license.

You’ll Understand Your Strengths and Weaknesses
Studying and practicing on your own can be an excellent way to review the things that you’ve learned and make sure that you understand them in a way that makes sense to you. However, individual study does not necessarily give you the benefit of assessment. In other words, you’ll know what you know, but you may not know what you don’t know. Exam preparation has a way of revealing your strengths and weaknesses. It’s useful knowledge to have, because it will help you target your studies to the subjects where you need the most help.

You’ll Get More Practice
There’s a reason that most professional exams have different types of courses that you can take to help you prepare for them. Quite a lot of people struggle to take tests, especially if they don’t know what to expect. You don’t usually just sail in one morning and blow everything away, especially if you don’t even know what the testing format will be. With expert exam preparation, you often get an opportunity to take sample tests as a way of learning more about your test-taking style. That way, you’re not caught off-guard on the day of the exam.

You’ll Get Help from Experts
When you start working in construction, you’re typically working under someone who has years of experience in the type of job that you’re going to be doing. This type of expert or mentor relationship can provide you with tips and ideas that can expand your understanding of the subject, as well as the practice. Exam preparation comes from people who have real knowledge of the field, as well as experience in helping others to get ready for the exam. You can take advantage of their assistance in ensuring that you have everything you need to do well on the test.

You’ll Have More Confidence
Many test-taking experts will tell you that confidence is a major determiner of success on an exam. Simply put, if you think you will do well, you’re more likely to do better than if you are convinced that you will not do well. Years of study and education can help to prepare you for the exam. Signing up for an exam preparation course will give you the confirmation that you have the skills necessary, which is an added benefit on test day. You walk in knowing that you have done everything that you can to get a great result, and you’ll be more likely to get it.

Taking the contractor licensing exam is so much easier if you have an expert team to help you prepare. For more information about our courses, contact CSLS today!

Studying as an adult can be a lot trickier than it was when you were a kid. You’ve probably got a full-time job, and you may have other family obligations too. All that adds up to a day that is often more full than you think. And yet, you can still find opportunities to study. Here are a few ways to take advantage of quick moments to help you get ready for the contractor licensing exam.

Focus Your Goals
Most experts in productivity will tell you that you must have focused goals in order to achieve them. For example, if you simply plan to “get some studying done,” you might not achieve nearly as much as you’re hoping to get. Instead, take a moment to think about certain topics that you would like to study, and make a list of the ones you want to start with first. If you’re not sure how to refine your goals, try setting broad ones and then breaking them down into pieces. You’ll have a better time estimating how much time they will take that way.

Create Short Tasks
With your list of study topics that you need to master, you can start planning out short tasks. At the very beginning, it may be difficult to estimate how long you think it’s going to take you to do something. That’s why you may need to have some longer study sessions. On the other hand, if you want to re-watch a recorded lecture, you simply need to see how long it is to set an approximate time for it. Make a list of short tasks that last 5 to 15 minutes, particularly if you find yourself constantly strapped for time. Making a little progress at a time is better than letting days pass and realizing you haven’t studied at all. In small blocks, the hours will add up.

Book Study Time
Finding time in the margins for studying can be a way to get extra study time, but it probably won’t be sufficient. When you are new to a topic, you may need to immerse yourself in it for a couple of hours before you have some passing familiarity with the terminology or the processes involved. Short periods of time are better for refining your skills or reviewing in advance of the exam. If you finish every week wishing that you could have planned out more time for studying, you may want to start there first. Set aside a couple of hours once or twice a week to give you that foundation. You’ll find it easier to fit more time for smaller tasks if you feel like you’re making progress.

Use Multiple Formats
The thing about fitting studying into the margins is that you may end up doing it in a variety of places. As such, you’ll need to have multiple formats in which you can study or review. If everything that you do presumes that you have access to a desk with books and a computer, you’ll have a harder time listening to a lecture on your commute. Try to give yourself more than one way to study or review, even if it means recording yourself explaining a concept so that you can listen to it later. Review is a key part of recall, so it won’t feel like wasted time.

Avoid Big Schedule Changes
As with any schedule change, one of the worst things that you can do is to swap your time allocation to the extreme. For example, cutting out an hour of sleep abruptly to buy you more study time isn’t likely to make you more focused. Instead, you may end up more stressed and less inclined to study. Start by making slight changes to your routine, no more than 15 to 30 minutes at a time. Give yourself a week to get used to it before you change it again. You’ll be more likely to build reliable study habits that way, and you won’t up-end your home life as a result.

Finding time to study is a crucial part of passing the contractor licensing exam. For guidance in meeting the requirements to take the exam, contact CSLS today!

One of the reasons people like small businesses is that they are unique. There’s a lot of opportunities to provide a one-of-a-kind service, when you own a small business. Of course, there’s a lot of unpredictability or inconsistency that can happen with small businesses, and it isn’t always a good thing. If you do these five things, you’ll have a better chance of keeping your clients happy.

Stay Organized
Have you ever gone to a business that didn’t seem to have everything together? It’s a nightmare. You ask questions and you worry that you won’t get answers with the right information. As a business owner, you need to stay organized. You should make a plan to attend to administrative tasks, as well as staying on top of each aspect of an individual project. That way, when someone calls you to request a bid or to get updated information about the status of a project, you won’t have to hunt through a pile of paperwork to figure out how to respond. If necessary, it’s worth hiring someone to help you keep track of it.

Return Communications
Experts often say that property owners should get multiple bids for a project before they choose one. In a lot of cases, clients end up going with only one or two because they couldn’t get responses from everyone else. As a business owner, you miss 100% of the sales leads that you don’t follow. You’re also more likely to lose out on repeat business, if you’re not in the habit of responding to client questions promptly and fully. You don’t have to answer the phone 24/7 or reply within minutes. Setting a goal to respond to all client communications within 24 to 48 hours could make all the difference.

Keep Explanations Simple
It’s worth keeping in mind the people are hiring you for your expertise. This usually means that they don’t know much about how to perform the services you offer, and they probably won’t be up on the latest jargon. It might seem like you’re complimenting your customers by refusing to use plain or common language when you’re explaining something to them. But as a result, they may not understand what you’re trying to tell them, and provide inaccurate feedback as a result. Take the time to investigate easier ways to have a discussion, and follow up to make sure the client understood everything.

Aim for Excellent Service
Offhand, you can probably think of several small businesses that you prefer to use more than others. For example, there’s that restaurant not far from you that always gives you great service. People tend to remember things like this. If your contracting business relies heavily on repeat business, customer service is a big factor in a client’s decision to continue. Aim to provide the best service that you can in every step of the process, and set goals to help you achieve it. If you miss the mark on occasion, take the time to figure out why it happened and plan to correct it.

Invest In Your Industry
When you start your contracting business, you may have a lot of current knowledge about the latest trends and techniques in the industry. Over time, without investment, that knowledge will become obsolete to some degree. The best small businesses are the ones that are paying attention to best practices and implementing them in their processes. It doesn’t mean that you have to chase all the latest trends and radically change your Business from one year to the next. Instead, making a regular investment in your industry allows you to evaluate changes and determine which ones will be best to apply to your business directly.

Being a good contracting business owner will help set you up for an excellent career. To get started on the road to becoming a licensed contractor, visit CSLS today!

When you think about starting a contracting business, it’s tempting to consider involving family and friends in the endeavor. After all, you know them and they know you. If you have a pretty good idea of their work ethic and what to expect, it can be a great partnership. It might also not work out the way you think. Here are a few things to consider before you make a choice.

Balance Skill Sets and Knowledge
Having a partner who can balance out your knowledge and experience is ideal. If you’re trying to do a complicated task, it’s smart to have two people who each have expertise in different areas. Two people who know the same things may find that their effort put together isn’t sufficient. If you’re thinking about going into business with a friend or relative a few years from now, you can tailor your education to suit it. That way, you can ensure that all the requirements for your business are met by one person or the other.

Identify Goals for the Business
Bringing two people with a long friendship together to build a business can be excellent if you have common goals. It’s a wise idea to sit down and outline what you expect to get from the business, as well as how you feel about taking risks. Misalignment on these basic aspects can lead to serious conflicts, and they may not take long to show up. It’s wise to be wary about a partnership of two people who are a lot alike. Sometimes, it’s harder to challenge a decision made by someone who acts just the way that you would. And it can also make you less likely to think about things from a different perspective. You want to partner with someone that you have a lot in common with, but perhaps not everything.

Evaluate Conflict Management Styles
When you evaluate a partner for your business, you might wonder how they act when they are under duress or facing a significant conflict. With a friend or family member, you probably have a good idea of what you can expect. This can be a good or bad thing, depending on how their conflict management style meshes with yours. If you love to address a conflict head-on, you may struggle to engage with someone who needs to think over it. Similarly, if you like to take a day or two to calm yourself and think about a resolution, you might find it difficult to resolve conflict with someone who demands an answer right now.

Set Clear Expectations
With friends and especially with family, it’s tempting to bypass a lot of things that your business actually needs to run. You would never agree to a job without a clear, written expectation of requirements and payment. When it comes to a family member, it might be easier to let things slide. Instead, you should make sure that you are running your business much in the same way that you would with someone that you don’t know very well. This means that you should:

• Set clear expectations for the business
• Outline requirements for each job
• Provide details in writing

That way, you don’t have to worry about anger or hurt feelings based on a misunderstanding that you can’t clarify.

Get Outside Opinions
Going into business with your best friend or a cousin you’ve known from childhood may sound like an amazing idea. It’s wise to get outside opinions on that. If you have a lot of people in your social circle telling you to reconsider for various reasons, it’s a good idea not to ignore them. Going into business is a big endeavor and it can cause a lot of stress for people in the first few years. If you notice a lot of signs that you and your partner won’t be a good match to run a successful business, it is better to know that before you get embedded in all the responsibilities.

Starting a business with a friend or family member is a common choice, but you have to do it wisely. To learn more about running a contracting business, contact CSLS today!

The longer you work in the construction industry, the more you’ll understand the changes in supply pricing. Periodically, you’ll notice a steep rise in the cost of steel, lumber or other materials you need on a regular basis. At times, you’ll need to consider raising your own prices. Here are a few factors to remember as you make a plan.

Research Pricing Trends
The best way to start evaluating effects on prices is to research trends. When the price of a particular material seems to go up practically overnight, you want to have a sense of why this is happening. Sometimes, there is a disaster or conflict that makes it more difficult to source materials that must come from a particular location. In these instances, you’ll need to figure out how long prices will be higher and if you need to adjust your estimates as a result. This is also a good time to evaluate your supply chain and build in a few ways to get materials when supply is harder to find.

Balance Short-Term Price Increases
Keeping your pricing relatively consistent is a good idea. It’s not always possible, but it makes sense to keep your strategy such that you can easily replicate it for most estimates. If the price increases on materials or services are limited and temporary, you may be able to balance them out without having to raise your prices. Many contractors choose to offer a variety of services, some of which have lower margins while others have higher margins. This way, you can avoid cutting into your own profits too much without having to notify clients about price increases that won’t last more than a couple of projects.

Avoid Underestimating Costs
Ultimately, you have to keep your business profitable so that you can continue to do it. The best way to do this is to set a minimum margin you need to make off of various types of projects and stick to it. In an industry where the contractor who bids the lowest often gets the job, it’s tempting to trim your margins down to nothing, especially after material price increases. But over time, you may notice your profits dwindling down as a result. Try to build a little padding into your estimates for price fluctuations, so that you’re not always having to eat the difference when it comes time to get paid.

Decide When to Increase Estimates
Increasing your prices due to material price hikes is a strategic decision. If you think of it this way, you’re less likely to feel like you’re taking advantage of your clients. Inflation naturally increases the prices for goods and services over time. It makes sense that you may need to increase your prices as well. After researching pricing trends and investigating what you can reasonably expect for your services in your area, you can set new prices. You’ll want to give yourself some time to roll out the price changes. For example, you may choose to wait until you complete a certain number of projects before you move to the new pricing model.

Notify Regular Clients
Once you come to the conclusion that you need to raise your prices, you need to publish this information anywhere your old pricing system was available. You will also need to notify regular clients who may expect to use the old prices. Keep in mind that increasing your estimates is a natural part of running a business. Explain to your clients how your prices will change, and when they can expect those changes to go into effect. Reaffirm your commitment to providing a quality service. These steps will minimize hassle or confusion once you get to payment.

Figuring out how you want to handle price hikes is an important component of running a contracting business. For advice on the best path to get started, visit CSLS today!