It may come as no surprise to WA builders but after a record period of building activity, the residential building sector is set for a significant decline in building activity. Although you can’t prevent a dip in the market, there are ways you can protect your business.
Plunge in building market set to continue
In a recent article by Business News, it was revealed that a recently released update from the state government’s Housing Industry Forecasting Group predicted that there would be approximately 8,000 less housing starts in WA over the current financial year. Land sales were also down, having dropped 24 percent at the end of 2015.
Within the article, the BGC residential managing director, Kelvin Ryan, described the reduction as the biggest fall most in the industry had seen. Mr Ryan attributed the decline in the market to slowing population growth and large amounts of residential housing which had yet to be sold.
To see the full article, visit the Business News website here.
What can builders do about the downturn?
If you’re a WA builder and are bracing for a market decline, it’s important to remember that it’s not all doom and gloom. There are ways you can ensure that your business remains profitable even during a downturn.
- Diversify – If you’re a builder working in a niche area, it might be a good idea to expand into other areas so you pick up some different clients. Look around and see if there are any gaps in the market that you might want to expand in to. If you only work with one developer, see if there are other developers you can also begin to build a relationship with. This means you have something to fall back on in tough times.
- High standards – When a decline in the market is happening and there isn’t the amount of work there used to be, it’s vital that you have high standards within your business so clients are happy to continue to work with you. Make sure you have good employees on board and pay them accordingly so they don’t go elsewhere. Address poor performance and focus on professional conduct within the business. This means more word of mouth referrals and more ongoing work.
- Market – When the market goes down, it’s time to put more emphasis on marketing your business. Check your website and make sure it’s easy to use and working correctly. Update it with any testimonials and pictures of recent completed work. If your business has a Facebook or LinkedIn account, don’t let it just sit there. Update with pictures, testimonials and links to your website. This gets your name out there and gives you the edge in a tough market.
To discuss insurance for builders, contact All Trades Cover today on 1300 826 850 and we’d be happy to help. You can also fill in our easy online form.