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Contractors & Construction Services
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Key Trends in These Sectors
FMI has worked with all types of contractors across the built enviroment, giving us the ability to tailor solutions for your particular needs, markets and challenges. We also have a full-service investment banking team dedicated to contractors and construction services.
With more than 11 million employees and $1.4 trillion in spending, the U.S. remains one of the largest construction markets in the world, contributing more than 6% of gross domestic product. And that’s just new construction, not including what it costs to maintain and service existing buildings and infrastructure.
While general contractors and construction managers operate differently, they face many of the same business challenges, such as managing and tracking projects, balancing risk and cash flow, and retaining key talent. Rising material costs, economic uncertainty and the potential for inflation continue to be top of mind for those trying to optimize their businesses and position themselves for growth after the pandemic.
Heavy civil and infrastructure contractors remain one of the strongest sectors of the construction market. As many continued working throughout the pandemic, and even saw increased productivity due to reduced traffic and improved site logistics, companies continued to book business as they completed it.
That doesn’t mean the path ahead will be easy. As heavy civil contractors worked through their pre-pandemic backlog last year, there was a lull in new projects, putting pressure on contractors trying to build their backlogs to normal levels. Margins on recently acquired work dropped compared to 2020, meaning many contractors need to be more selective on pursuing business and focus on making sure their operations are efficient.Yet, there is still reason to be optimistic. The U.S. is poised to increase infrastructure investment, and heavy civil and infrastructure contractors will need to be smart about where they bid on new business. As companies see market conditions improving, many are considering growth and diversification strategies to take advantage of current and future opportunities.
Managing labor productivity, sourcing materials and optimizing equipment are challenges that require focus and discipline. This is particularly true for specialty trades contractors.
Training is not enough to improve performance. A strategic approach to improving direct cost management is imperative for all specialty trade contractors. Additionally, there will also be greater demand for these specialty trade contractors as infrastructure investment increases and competition to complete projects remains high.
Improving the bottom-line profitability begins with superior controls and planning at all levels within the firm.
Issues around connectivity and wireless communications infrastructure, coupled with the increased need to protect networks from cyberattacks and climate disasters, continue to drive the landscape for utility and communications providers. Economic uncertainty is also putting pressure on profitability for many serving utilities.Yet, optimism remains in the market as the U.S. continues to work on an infrastructure bill and federal pandemic relief packages provided many states, municipalities and other local governments with funding specifically for infrastructure.
How We Help
- Understand your competitive advantages and how to use those to win business.
- Make decisions about entering new markets or offering new services based on data-driven insights and market research.
- Learn to develop long-lasting customer relationships that bring you repeat business.
- Assess your current market and operations to discover strengths and areas for improvement.
- Craft clear plans for implementing change that lasts and is adopted across the organization.
- Understand clients’ needs and how you can meet those profitably.
- Create consistent performance and outcomes across projects by understanding your operations and processes.
- Develop tools and metrics to help monitor your business and continually improve.
- Establish risk management practices across the enterprise.
- Create leadership and talent development plans that build exceptional people across the organization.
- Align your culture, strategy, systems and processes around a clear vision.
- Incorporate industry best practices for your leaders to drive business.
Meet Our Team
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Pandemics force a mass reckoning, and 2020 left no one untouched. The events of the past year catalyzed changes long at work in the construction industry nearly overnight. It is time for contractors […]
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