Negative Marketing Carries a Much Higher Price
All activity by construction companies is a form of marketing. It will either be positive or negative marketing. Large multi-nationals spend thousands of pounds on advertising literature. These glossies and their websites boast of their accreditations, their achievements, workforce and completed projects. However, how are these projects being completed? What is the real cost to people further down the supply chain?
The Real Issue
I need to share these thoughts with you for two reasons. Firstly, I want small subcontractors to become aware that there are many others who are struggling with the same issues. Second, I want to expose these practices that are discussed to a wider audience.
“The important issue is not what we achieve but rather how we achieve our goals!”
A delighted client will boast about his contractor and professional team when the building is completed. We hear this so often. This is the basis of good PR. However, there are other factors that should be taken in to account? These ‘other’ factors are the stories we have heard and experienced behind the scenes. These ‘behind the scene’ issues are serious and impact the lives of thousands of people running small companies and the employees as well as their families. These business owners are being bullied by clients, construction professionals and main contractors as well. Let me know about your story.
The Impact of Bullying
I am sure by now you are all aware of the recurring topics that have clouded the minds of many sub-contractors over the last few years. There are still strong feelings about these issues amongst contractors. I understand that too many small companies have closed down as a result. Principal construction leaders have changed the specification (time and time again), extended payment terms without permission and use every trick devised to push sub-contractors beyond the limits of their brief and their cash flow! These are key issues which impact too many people and create negative marketing.
Where do I hear about this? Anyone working in the construction industry will have experienced these conditions. For some, the payment terms may be moved from 30 to 120 days. Others have had to close the doors of their business. I recently heard of a major client reneging on payment. A major contract and a well-known client (an airport authority). The work was completed BUT the authority did not pay the contractor and they closed their doors. This, of course, did not need to happen. The fact that it did and still happens is immoral.
Now, that may be one extreme case. However, I know of contractors who have completed works and are still waiting for payment after 6 months. It is wrong!
The Chocolate Bar Story
If I walked into a shop and picked up a bar of chocolate. I ask the shop owner for the price and he tells me 85p. I then peel back the wrapper and eat it. Thinking that I am ‘big-hearted’ I then proceed to offer the shop owner 40p and after much argument, I walk out of the shop. He then chases me because he wants his additional 45p. After an hour of discussion I have worn him down and I promise to come back later and pay the rest. He has my telephone number and calls me again and again and again.
This may not be a brilliant analogy but I hope you understand from the story the frustration that many sub-contractors experience every day within our industry.
In A Nutshell
There appears to be a couple of ‘sores’ within the industry that evoke much debate. One is about payment terms or rather the manipulation of payment terms. Another related issue is the question of ‘Retentions’ And, for the uninitiated, retention is money held by the Employer/Client as a safeguard against defects which may subsequently develop and which the Contractor may fail to remedy. This issue can be contentious and I will be asking a friend of mine to write a Guest Blog on the issue soon. The other issue is about PQQ (Pre-Qualification Questionnaires) which runs on like a stream gaining momentum. I have already written about this issue before and you can read further by clicking on this link. Construction PQQ
If you are a contractor and having problems resolving payment issues I would recommend you contact
See you soon…