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PCCA Journal|1
st
Quarter 2011
27
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cost structure and rigid operational style will find competing
in the new normal particularly challenging. Agile organiza-
tions with commitments to high levels of productivity and
support by senior management will create competitive cost
advantage.
Labor costs represent one of the largest components of
cost for contractors. Estimates of waste of labor dollars (i.e.,
recoverable lost time) are as high as 40 percent on some
projects. Dedicating resources to improving productivity in
the company will yield improved competitive pricing and
bottom-line results for these contractors. For example, Exhibit
3, taken from FMI’s 2010 Contractor Prefabrication Survey,
illustrates how prefabrication is helping contractors become
cheaper, better, faster.
Conclusion
Marketing, customer loyalty, value propositions, market
brand, and efficiency are all part of the new normal for
contractors. Competitive companies are best-value marketing
machines. Having an effective marketing strategy provides
you with the tools to proactively evaluate your market and
your customers and target the opportunities where you can
differentiate and bring value no matter what economic condi-
tions are present.
Proactive analysis of market conditions and the impact of
those conditions on the players in your market are essential
in understanding what your customers need and how you
can effectively fill those needs.
Numerous market studies have been conducted on post-
downturn economies. These studies have proven that over
the course of the downturn, companies that pursue aggres-
sive strategic marketing campaigns exploit and refine their
capabilities, successfully source and identify new opportuni-
ties, fill the unfulfilled needs of the market, and ultimately
succeed with a high degree of profitability on the other side
of the downturn. Your company can achieve this success as
well.
Cynthia Paul is a managing director at FMI Corporation. She
can be reached at (303) 398-7206 or
cpaul@fminet.com.Ken
Roper is a principal with FMI. He can be reached at (303) 398-
7218 or
kroper@fminet.com.