Growth Consulting for Commercial Construction

Commercial general contractors, specialty trade contractors, design-build firms and civil contractors occupy an unusual position. Marketing help is available — there are agencies that serve construction and understand the industry. What is generally not available is anyone accountable for the whole question, which is why a firm can employ a competent marketing partner for years while the actual constraint sits untouched somewhere else.

Growth in commercial construction is decided before the invitation

The defining feature of this market is that most work is effectively decided before a formal opportunity exists. A general contractor has a shortlist for a project type before bids go out. An owner has a firm in mind before the RFP is written. By the time a bid invitation arrives, the outcome has often already been shaped by relationships, past performance and who was in the room during preconstruction.

This has a direct implication that many firms operate against. The work that determines next year's revenue is relationship and positioning work happening now, with owners, architects, developers and general contractors — and it is almost always the first thing dropped when the current backlog gets busy. The result is the cycle nearly every contractor recognizes: heavy backlog, business development stops, backlog thins three quarters later, everyone bids aggressively to fill it, margin suffers, and the pattern repeats.

Bid-hit rate that is measured in aggregate, if at all

Most firms can state a rough overall hit rate. Far fewer can state it by project type, by owner, by general contractor, by delivery method or by estimator — which is where the useful information is. A firm with a strong overall number is frequently subsidizing a category it should not be bidding at all, and the aggregate is precisely the number that hides it. Estimating is expensive; bidding work you consistently do not win is one of the largest uncosted expenses in the business.

Preconstruction relationships treated as everyone's job

The relationships that produce negotiated and repeat work are usually held personally by two or three senior people. Nothing is recorded, no one else has access, and the pipeline is inseparable from those individuals. That is both a growth ceiling and a succession risk, and it is rarely described as either — it gets described as how the industry works.

Past performance that is never assembled

Firms complete work they should be able to reference and then do not assemble it. Photography is inconsistent, project data is not captured at closeout, and the proof that would carry the next pursuit lives in project files rather than anywhere usable. Qualifications packages get rebuilt from scratch under deadline, and the strongest available argument for the firm goes unused.

Preconstruction and estimating as an unmeasured bottleneck

Estimating capacity often determines how much work the firm can pursue, and it is regularly the least examined function in the business. When estimators are saturated, pursuit decisions get made by whatever arrived first rather than by what the firm is best positioned to win — which is a growth constraint sitting in operations, disguised as a sales problem.

The bid you win is usually decided long before the invitation arrives — and long before anyone is measuring.

Why the constraint is often not marketing

Growth is constrained in one of six places: market, revenue, operations, technology, intelligence, or leadership. For commercial construction firms it sits in revenue, operations and intelligence far more often than in market, and those are the lenses the available vendors do not sell into. A firm can have a good website, a capable marketing partner and a full trade presence, and still be constrained by a hit rate nobody has segmented, relationships held in two heads, and an estimating function running at capacity.

Five questions worth answering before the next pursuit decision

• What is your bid-hit rate by project type, by owner and by delivery method — and which category are you losing consistently enough that you should stop bidding it?
• What did estimating cost last year, and what share of that was spent on pursuits you did not win in categories where you rarely win?
• What percentage of revenue came from negotiated or repeat work against hard bid, and is that share moving in the direction you want?
• If the two people holding your key relationships were unavailable for a quarter, what happens to the pipeline — and where is any of it written down?
• Can you assemble a qualifications package for your strongest project type this week from existing material, or does it get rebuilt every time?

Those five are answerable from records the firm already has, and they usually locate the constraint without outside help. Where they point is where the next dollar should go. See the revenue constraint →

Common questions