Running the Business

Recognize Barriers to Garry Bartecki is the managing Successful, Profitable member of GB Financial Services LLP and a consultant to the Associated Equipment Distributors. He can be reached at (708) 347-9109 or gbartecki@comcast.net. Projects Understanding and addressing the barriers ahead can help you get projects done profitably.

“A ll you have to do is get it done” kind of sums up where contractors stand in 2021, with more work becoming available along with more barriers to win bids that allow for cash profit. With prices for goods and services continuously changing and the lack of qualified help, every contractor has to look in the mirror each day and ask themselves, “How am I to complete what I have planned for today?” Good question.

Bidding the work is not like it was two or three years ago where you were always at least in the ballpark when it came to pricing out the job and adding in the overhead and profit. It’s not the same today, not by a longshot, because the bids are tight, there is a lack of qualified help and equipment rental prices are sure to spiral higher once construction activity swings into full gear.

Even if you bid it right, materials costs can change tomorrow. Hopefully, your contract includes a materials contingency to cover price swings. If not, then running an efficient ship will be 100% necessary. That means materials are under control and scheduled to be delivered when and where they are required.

EQUIPMENT PRICES, RENTAL RATES ON THE RISE

During the pandemic, it seems that a lot of rental companies and contractors sold off units at attractive prices to produce cash flow to stay afloat. Hopefully, buyers took the time to inspect their purchases and have them serviced and ready to go.

If you weren’t one of those buyers, you may find yourself with less availability of the types of equipment you need for your job. Ritchie Bros. is predicting significant rental rate and equipment price increases.

You need to have equipment to complete the task, and no longer. So, if you find you are short of the equipment you usually own, now is the time to visit a few rental companies to see what they have to offer.

WORKFORCE HEADACHES AGAIN EMERGING

It appears the biggest headache you will have is finding qualified help that has the knowledge to complete projects on schedule. It does not do you any good to get the materials and the equipment schedules right if it takes you twice as long to complete the job.

This takes dedicated people to do the work and management delegating the work schedule and workers assigned to get it done. From an efficiency standpoint, managing workers and their related payroll could make the difference in whether you produce a profit or not.

You will need back office help to: ˜ order and follow up on material deliveries; ˜ manage rental contracts along with their starting dates and estimated call-off dates; ˜ and provide up-to-date job costs and estimates of time and dollars remaining according to the contract.

Without this type of crew backing you up, it is almost impossible in this market to wind up with a successful outcome. Contracts are too tight to do anything less.

You also need a reliable crew with the skills to complete the work on time. The problem is experienced workers are hard to find and hard to keep. So, you will have to find ways to get them to sign on and to keep them until your season is over. This is not an easy task.

Finding this crew will require marketing and branding to attract workers to your company. Incentives to start and incentives to stay could also be part of your program. Your incentive to stay could take the form of “profit sharing,” where a pool of money is set aside for employees who are part of this type of plan.

TRAINING CAN ADD VALUE

In today’s job market, I advise entertaining anyone willing to do the work, with some brought on as support staff to avoid paying top dollar to do “busy work.”

Providing a training program should be considered as long as participants agree to work for you (if you choose) for a period of time to offset training costs. Apprenticeship programs have merit and give you a chance to “interview” the person in a live work environment.

Proper training could help keep costs under control and help manage your insurance costs. There are many virtual training sessions available on the technology and equipment you will be using.

But no matter how you plan out your program, it is imperative to meet all local and federal guidelines and thus reduce risk. The new ANSI standards for aerial access equipment are a good example, since as the equipment owner, you could be held liable if there is an accident using this equipment.

EXPLORE EMPLOYEE RETENTION TAX CREDIT

Last month, I mentioned the tax breaks related to the stimulus programs and where to find a summary to review them with your tax firm. After reading that material again, I will make special mention of the Employee Retention Tax Credit, which can provide a quarterly $5,000 credit for each qualified employee. This is important because even if you received Paycheck Protection Program (PPP) round 1 and 2 funds, you can still qualify for these credits. There are a lot of complexities surrounding it, but it’s worth the time to investigate. One of the major qualifications is for a company to have a 20% decline in year-over-year gross receipts.

And don’t forget the JOB SHOCK research reports (https://bit. ly/3dfhGV8), which can help you configure your company for the future; parts 2 and 3 are now available. ET

201 N. Main Street, 5th Floor Fort Atkinson, Wisconsin 53538 (800) 538-5544 www.ACBusinessMedia.com

Publication Staff

Publisher SEAN DUNPHY, sdunphy@ACBusinessMedia.com Editor BECKY SCHULTZ, bschultz@ACBusinessMedia.com Senior Field Editor CURT BENNINK, cbennink@ACBusinessMedia.com Contributing Writers GARRY BARTECKI, SARA JENSEN Art Director DAVE HAGLUND Senior Production Manager CINDY RUSCH Audience Development Manager ANGELA FRANKS Advertising Sales (800) 538-5544

SEAN DUNPHY; NIKKI LAWSON; KRIS FLITCROFT; ERIC SERVAIS; TADASHI SOMA National Automotive Manager TOM LUTZKE (630) 484-8040

ForConstructionPros.com

Editor LARRY STEWART Managing Editor KIMBERLY HEGEMAN

AC Business Media

Chief Executive Officer.............RON SPINK Chief Financial Officer..............JOANN BREUCHEL Chief Digital Officer .................KRIS HEINEMAN Chief Revenue Officer ..............AMY SCHWANDT VP Audience Development........RONDA HUGHES Dir. of Digital Operations & IT ..NICK RAETHER Director of Digital Strategy ......JOEL FRANKE Group Content Director............JON MINNICK

Change of Address & Subscriptions

PO Box 3605, Northbrook, IL 60065-3605, Phone: (877) 201-3915 • Fax: (847) 291-4816 circ.EquipmentToday@omeda.com

List Rental

Bart Piccirillo, Sr. Account Manager, Data Axle Phone: (518) 339-4511 bart.piccirillo@data-axle.com

Reprints

Reprints — For reprints and licensing please contact Sean Dunphy at 920-542-1252 sdunphy@acbusinessmedia.com

Published and copyrighted 2021 by AC Business Media Equipment Today makes every effort to report manufacturers’ product news accurately, but is not responsible for validity of news claims. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher. SUBSCRIPTION POLICY: Individual subscriptions are available without charge in the U.S. and Canada to management, engineering, supervisory, equipment maintenance and other personnel who have buying influence in the construction equipment industry. Subscribe online at www.ForConstructionPros.com. Publisher reserves the right to reject non-qualified subscribers.

One year subscription to non-qualified individuals: U.S. $50; Canada/Mexico $70; all other countries $100 (payable in U.S. funds, drawn on U.S. bank). Single copies available (prepaid only) $10.00 each (U.S., Canada & Mexico), $15.00 each (International). For change of address or subscription information call (847) 559-7598 or fax (847) 291-4816. Equipment Today (USPS 369-290, ISSN 0891-141X) is published is published 12x with issues of January, February, March, April, May, June, July, August, September, October, November and December by AC Business Media, 201 N. Main Street, 5th Fl., Fort Atkinson, WI 53538. Periodicals postage paid at Fort Atkinson, WI, and additional entry offices. POSTMASTER: Please send change of address to Equipment Today, PO Box 3605, Northbrook, IL 60065-3605. Printed in the USA.

Canada Post PM40612608. Return Undeliverable Canadian Addresses to: Equipment Today, PO Box 25542, London, ON N6C 6B2.

Vol. 57 No. 5 May 2021