The U.S. construction industry today is operating in a difficult-to-navigate environment. Though 2025 will likely usher in more rate cuts, financing for construction projects remains tight, and the costs of essential building materials continue to run high. Worker shortages and skills gaps have become endemic: As of early 2023, the industry was staring down a shortfall of more than 500,000 workers.
However, these issues are not the main obstacles keeping most construction companies from becoming industry-leading powerhouses. Rather, they can’t get their businesses firing on all cylinders simultaneously—they’re either winning plenty of work but struggling to perform it profitably, or having their operations in order but struggling to keep their pipeline flowing consistently.
The outcome of this up-and-down pattern is an earnings trap. In 2023, the average contractor earned a net income of just 5% annually. Breaking free of this earnings trap requires diagnosing what’s holding your organization back, articulating a vision for success and creating a roadmap to achieve your goals. But what if you aren’t sure what’s wrong, how to address your company’s areas for improvement or whether your aspirations are reasonable? Partnering with an outside source might just be the answer: a long-term business consultant.
Here a few key things you can expect from an effective consulting relationship.
EXPERT OUTSIDER DIAGNOSIS
Imagine if you walked into a competitor’s organization for the first time today and the owner asked you to help get the business on track to meeting its goals. Chances are, because you’re a seasoned professional, you could spot several areas where operations could improve. So why might you struggle to judge your own company the same way? Simply put, you’re too close to the situation to see it clearly.
Construction consultants are experts within the industry, but outside your organization. They examine the “get-work” and “perform-work” aspects of your operations with fresh eyes; thus, they can often identify core strengths and fatal weaknesses that those involved in your business’ day-to-day might miss.
A good consultant will not suggest one-size-fits-all solutions to the issues they find, but rather will work to tailor fixes for each company’s particular needs. Say, for example, that a general contractor is struggling with the feast-or-famine cycle—periods of high activity are followed by stretches with little to no work. The owner tries managing this issue by running lean, but when the clients’ pipelines dry up, the contractor can barely keep doors open. Layoffs prove necessary just to survive. Adding the overhead of a consultant seems like a questionable move in this situation, and while the owner is skeptical of the value proposition, the leadership team is unsure of what else to try.
The hypothetical sketched out above has a real-world counterpart. In that instance, the consultant suggested an initial, intensive three-hour session—if the team didn’t see the point of continuing afterward, the consultant would bow out. After the assessment, it became clear to the consultant that the contractor’s issue wasn’t that they were losing bids, but that they were bidding to the wrong potential clients: those with established relationships elsewhere. The consultant warned the team that solving this problem would take about two years, but that by targeting new prospects more strategically and setting a goal to expanding their customer base from three clients to nine or more, they could build a more stable future.
That company chose to continue working with the consultant to make this vision a reality. Years later, the company grew from 100 to 350 employees and from three key customers to 18 core relationships. With outside guidance, the contractor was able to break free from the feast-or-famine trap and become a more resilient, profitable company.
A consultant’s ability to dig beneath the surface and pinpoint the underlying reasons a company may be faltering means leaders can implement new systems that will actually bring about the deeper change needed for their companies to thrive. The key is integrating these best practices without stripping away the company’s core identity, which is why it’s so important to select a consultant that doesn’t force your unique company to conform to their off-the-shelf solution. Any proposed changes a consultant suggests should align with and build upon what the company is already doing well.
CLARIFY YOUR VISION
Would you start building without a solid preconstruction plan? Of course not. Similarly, no construction company can achieve long-term success without a strategic vision for the business.
Consultants not only help you identify and fix points of contention, but also work to ensure sustainable long-term growth. A good consultant will pose questions like, “Where do you want to find yourself in business three years from now?” and “What should be different and better than it is today?” The answers to these questions will allow you and your consultant to formulate a strategic vision that meets three main criteria:
- Meaning: This is the “why” behind what you’re trying to achieve—for example, diversifying the markets you serve. The reason you’re pursuing this goal must matter enough that you’re willing to go all in; otherwise, you’ll lose your drive when the going gets tough.
- Specificity: What do you need to do to make your goal a reality? For instance, to accomplish your diversification goal, you’ll need to create a three-year plan showing the target revenue growth and revenue diversity for each year of that plan. You must identify your clients in each new market sector and the size and type of projects you’ll perform.
- Market Alignment: Complete a market analysis and speak with your employees, customers and allies to gauge the market’s interest in the kind of company you hope to become.
COMMITMENT AND ACCOUNTABILITY SUPPORT
Another critical aspect of a consultant’s work is providing accountability. For many business owners and C-suite leaders, a consultant acts as both an adviser and a partner, helping leadership teams stay focused and on track and challenging their thinking when necessary.
It’s one thing to talk about becoming an industry leader, and another thing entirely to put in the work to make it happen. For a company to succeed, it must commit to improving its internal processes while still delivering on its day-to-day projects. It’s a major balancing act, but it’s one that a consultant can help companies achieve by providing guidance on improving systems, refining financial controls and setting clear, achievable goals—all while continuing to manage current projects.
Transforming an “almost-there” construction company into an industry leader is not a quick or easy process, but it is achievable with the right guidance and team. Strong, construction industry-focused consultants can provide the expertise and accountability your organization needs to grow, while ensuring that it stays true to its core values.
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