Could Your Contracting Business Become Obsolete? Here’s How to Tell

 

In businesses that rely on any kind of technology, there’s a risk that your plan for products and services may eventually become obsolete. While there’s always going to be a market for skilled building services, the way that you and others deliver them will continue to change in the future. The last thing you need is to find yourself out of options only a few years into your career. Here are five ways you can tell that your business model could become obsolete in the coming years.

There’s Less Demand for Your Services

The nature of technology is this: What used to be common 20 or even 10 years ago might be almost unheard of now. For example, line-voltage lighting was almost the only option for outdoor spaces for many years. Battery-operated and low-voltage options were difficult to find, expensive and not very effective. Low-voltage wiring used to be much more common inside homes and businesses. With a greater emphasis on wireless technology, however, people have less need of it. If you are relying on a set of services that an increasingly smaller group is going to need, you may need to branch out.

You Use Systems or Practices That Are Outdated

When you find a piece of technology that allows you to do work faster and better while you invest less time and physical effort, you might be pretty likely to adopt it. This isn’t always true for business practices, however. For example, businesses that have exclusively relied on a design/bid/build approach to construction may struggle as more private and public sector clients indicate a preference for design-build. Contractors who lack the interest or flexibility in changing the way they do business to accommodate these changes will be less likely to secure work in the future.

There’s a Race to the Bottom in Your Field

A lot of fields in construction operate with relatively thin margins. As it becomes easier to compete with the use of technology and pre-fabricated products instead of custom-building services, you may notice that some companies start to cut their prices as a way to keep finding work. This is a dangerous path to take, because minimal profits make it harder for you to:

If materials and equipment prices are going up but the industry isn’t raising rates as a result, there will eventually be a bigger problem of sustainability.

Your Services Are Easy to Automate

Almost every industry has an example of a job that somebody used to do that is now so easy to automate that unskilled property owners can manage it mostly by themselves. Wireless connections, sensors and other monitoring tools have rendered some inspection tasks obsolete. Automation of the operation of equipment and the production of components used in building have dramatically changed the way that people who work in these fields do their jobs. This may be a natural consequence of technological progress, but not being willing to roll with it can translate into a lack of available work.

You’re Providing a Custom or Specialized Service

Providing a specialized or custom service in construction will always have a market. The difference is that you have to keep an eye on what kind of market is there. For example, people who make seamless gutters onsite or provide niche services in woodwork have to be careful that pre-fab doesn’t take away their entire business model. This is heavily region-dependent and also relates to the strength of the economy. But as pre-fabricated components become more durable, difficult to distinguish from custom, and much less expensive, people who appeal mostly to the luxury market may find these innovations taking some of their clientele.

Construction has changed a lot in the past decade, and it will change more in the years to come. If you can be flexible with your service options and keep an eye on the future for your business model, you have a better chance of making it work. To get started, visit CSLS today!