THE 5-B Training for small business owners

Business development and the business planning process can be defined as establishing the framework for identifying scopes of work (and project selection) that best fit the entity’s business model that drives profitability.

In the construction industry most projects are competitively bid. A contractor that does not fully understand their business’s strength and weakness and their competitive advantage will ultimately fail. For a business to be successful, it must manage the type, size, and location of projects they are experts in estimating and delivering at a profit. 

The competitive bidding process that is most common in the construction industry encourages successful contractors to automate their bidding and proposal generation process. The planning tasks accomplished in B-1, afford the estimator to confidently answer the bid/no-bid question, and effectively build the project on paper first.

In this book, considerable time is spent discussing cost. Cost of the project elements as well as the cost of doing business are equally important to a contractor’s survival. 

 The Building module involves the contractor performing and managing the building process, costs, schedule, project resources, job safety, and timely billing the customer. All while creating and maintaining accurate project documentation, including consistent customer communications. This is also the phase where a contractor begins to realize profits. 

The Billing Module is where contractors are keeping track, financially, of the progress of a project. Information is received from the Bidding and the Building activities. Here the contractor develops the project budget from the earlier estimate, then the accountant compares it to the financial data captured during actual project activities.

The result is to produce timely and accurate billing documents to forward to the customer for payment.

The Banking Component is mostly concerned with having a healthy flow of cash for business operations and financial capacity building which coincides with improving credit scores for banking, borrowing, and bonding resources. This task, if done consistently and with care, leads to business sustainability and wealth building for both the owners and employees.