Randalism: A Partnership is the only ship designed to sink.
However, we understand your preference, so I would like to talk about it in this blog post.
Joint ventures are a bit like change orders. They can be an incredible opportunity to make or lose much money very quickly. Almost as quick as betting money on a roulette wheel in a casino.
Joint Ventures have their own accounting rules. The devil is in the details. How costs and profits are shared among the participants depends on how the joint venture is structured and the terms of the agreement.
Contractors with annual sales of less than $10,000,000 often get together to work on a specific project. They find a friendly competitor to supply labor and equipment for a percentage of the job, hourly fee, or a flat number. This could technically be a "Joint Venture"; however, the time and scope are generally short and sweet. For example, a concrete contractor may have a large project requiring more finishers than on staff.
Every business experiences slow periods when the market for their goods or services lessens and sales drop. Construction business owners like you might be tempted to view downtimes as unproductive or wasted, but there are ways you can make the most of your business during these seasons.
Here are five ways to ensure this time isn't wasted:
1. Take a good look at your business
When things are busy, it gets easy to fall into a habit of taking care of day-to-day tasks and forgetting your overall business picture. However, slower times are an excellent opportunity to step back from the daily grind and ask yourself if your business is still moving towards its goals, what opportunities or challenges are on the horizon, and whether it's time to try something new.
Still Doing Your Payroll?
If you don't have a finance background, you'll likely spend a substantial amount of time calculating employees' work hours, computing for taxes and other deductions, creating payslips, processing, and filing.
Even if you have a bit of a bookkeeping background, are you sure you want to spend your precious time doing these tasks instead of focusing on your construction business's core aspects?
Making decisions never ends for contractors like you. Being adaptable is one of the basics of good decision-making skills.
Think of decision-making as being in a bumper car. You are continually driving and trying to avoid the other bumper cars. Suppose you hit one you back up and go again (reminder this is the only safe place to hit other vehicles). The rest of the time, life as a contractor feels more like the Indy 500. You are driving as fast as you can, passing other cars, making pit stops, and scrambling to make it to the finish line.
Translate this to a typical daily life of a construction contractor:
- The paperwork, processes, and decision-making are never-ending
- The concept of time is all about 10 minutes
- Your coffee brews in less than 10 minutes
- Take a shower in less than 10 minutes
- Load the dishwasher in 10 minutes
- Take out the trash in less than 5 minutes
- Read your email in less than 5 minutes
- Decide what bills to pay in less than 5 minutes