It also depends on state of economy

Last week, we discussed what can make your business finance application fail and noted the importance of tailoring your business plan to a specific audience.

Last week, we discussed what can make your business finance application fail and noted the importance of tailoring your business plan to a specific audience.

Today, we extend these general principles to discussing how to tailor a business plan for a construction company.

Let's recapitulate briefly and remind you why you need a business plan.

A business plan not only helps you to secure finance, it also improves your management skills and gives you direction.

It is easier to plan how to reach your destination when you know where you want to go. The same thing applies to a business plan, which helps you communicate your goals and specify your way of operation to employees, suppliers and financiers.

Tailoring your business plan rather than using generic templates, will make it easy to identify your niche market. After this you can think about how to market your service.

You must also know where and how to find jobs for your new business. But as an emerging enterprise you may have to focus more on government jobs.

The government is one of the biggest clients for small businesses. You also gain experience that will allow you to expand your construction business.

The best way to find tenders or government projects, is to read departmental bulletins, newspapers and to check the departments' websites.

But there is more to business than getting tenders. Poor financial planning can lead to failure, so you should plan carefully because success in the construction industry is based on prices. Poor financial planners usually have a high rate of failure.

There are many ways to market your services. Your marketing must also depend on factors such as the state of the economy, stability of local employment, the seasonal quality of work, labour relations, good subcontractors and interest rates.

Your bidding will determine whether you succeed or fail. Make careful and complete estimates of your expenses. Many successful contractors attribute their success to their estimating procedures.

Successful contractors calculate all their costs before submitting a bid. These costs must include everything spent during construction, such as interest charges on borrowed money, insurance fees and travel expenses.

Deciding whether to bid on a project must be determined by your company's ability to complete the job in time and according to the specifications.

Don't take jobs that will not make you a profit, so be careful not to bid too low. Underbidding to get jobs will eat away your profits. But if you bid too high you are likely to lose out to more established competitors.

Once your marketing translates into a contract, start planning how to deliver the job. Create a production schedule and set stages by which certain things should be finished.

A proper schedule will tell at a glance if the job is progressing as planned. This will help you to deliver in time and help you develop the track record you need to bid for bigger jobs.

Information for this article was sourced from the US Small Business Administration website.