Survival planning is fine, but planning out how to thrive in the aftermath of this downturn is just as important if companies in the building industry hope to do more than just survive in the foreseeable future.
Many of the submarkets within the broader real estate and land development markets feel ice cold right now. But, as we've all heard, the one thing we know for sure is this too shall pass.
Many of you are doing everything within your power to simply survive, and well you should. But look beyond survival.
Start by prioritizing some strategic business planning with an eye to the future by focusing on three areas:
- Retaining your firm's best talent.
- Investing in your clients.
- Carefully considering what will be your new value proposition once the
downturn turns.
Retain talent
We spend decades building a staff of talented, dedicated and loyal employees whom our clients value. We cannot afford to lose that institutional talent in this downturn.
MacKay and Sposito has found interim lines of work for employees in this recession so they are still here when their market returns.
Be creative and find ways to communicate how much you value their talent and even ask what they think they can do to help the business while their particular market niche is cold. They are nervous, too, and you might be surprised how creative they can be to avoid changing careers during this downturn.
Invest in clients
Good clients are hard to come by in any business, but trusted savvy land development clients are difficult to find, harder to get and easy to lose if you are not vigilant.
Many of our traditional land development clients, business partners and strategic contacts have gone underground until things get better. They will be back and we cannot afford to let those relationships wither.
Continue to invest in those relationships now, even though immediate business development opportunities aren't likely to be found there. These "long ball" investments will help you thrive in the future.
This will also build loyalty that will serve you well when the market turns.
Consider your new position
Before the downturn, it seemed that there were never enough engineers, planners, surveyors, architects or land use attorneys to meet the demand. Nor was there enough agency staff to review it all.
So most of us had a pretty straightforward value proposition: Get it done, get it done right and get it done fast.
We saw wages and fees escalate in response to that high demand. However, just as our community's valued homebuilders are facing a marketplace correction in value, we all will have to find a new value proposition or face the challenge of competing for fewer projects within a very crowded marketplace with
little to differentiate your business.
When the land development market comes back, will it be the same? Will the same tactics and projects be there for us to do what we did before? And will there be enough of it to do profitably?
No matter what piece of the real estate or land development market your business focuses on, I hope the answers to these questions will help you thrive after the recession ends – and it will end.
Tim Schauer is president of Vancouver-based MacKay & Sposito Inc. He can be reached at tschauer@mackaysposito.com or 360-695-3411.
