Engineering Business - 5 More Keys to Increased Revenues and Profits

Welcome back! There are multiple strategies that can be implemented without having to cut staff. In our first article on Increased Revenues and Profits, we discussed the following strategies:

Key 1: Increase Service Fees
Key 2: Workload determines the Company Size
Key 3: Do not Focus on Sectors with Very Small Profit Margins
Key 4: Contact Existing and Previous Clients for New Contracts
Key 5: Deliver on Your Promises

The business strategies for professional service firms like engineering are quit different from the typical business. Most of the business books in the book store and library will not apply to your business. You could attach all of the door hangers you want and that will not increase your business contacts. You can place all of the advertisements you want in the newspaper and your phone will not ring. Why not? Professional Service is a very personal business; it more about networking and building business relationships. So the business strategies are different from that of a retail business.

Now we will discuss 5 more strategies to increase revenues and profits without cutting staff.

Key 6: Be Patient and Stay Focus in Your Marketing - Marketing is always ongoing. The way you dress, your attitude, your correspondence, and all of your literature affect your marketing efforts. Sooner or later your future client will need your services, and you want them to pick up the phone and talk to you. In the mean time you are building a relationship with your current and future clients. It seems that marketing becomes top priority when the revenues fall. But in reality marketing should be consistent. Constantly evolving as the company grows. If you want to increase your revenues then increase your marketing efforts. Also, not all marketing is expensive. In fact, most of the marketing required for professional service firm is very inexpensive.

Key 7: Provide Detailed Proposals - Engineering is a complicated profession that is guided by very detailed specifications and procedures, but why do engineering proposals are all too often vague without any structure? Very few projects performed by an engineer can be spelled out on one sheet of paper. Some clients may ask for a simple one page proposal, but if you can not describe in detail what services you firm will be providing with the fees associated with those services, you are taking a risk that may eat all of the profit and then some. A vague contract is open to interpretation. The client's interpretation will usually win.

Engineers are not construction contractors. The professional services provided by one firm will not be the same as another engineering company. A complete professional proposal should include a cover letter, agreements, definitions, assumptions, services, fee schedule, and project schedule. A complete detailed proposal separates your firm from the competition, and clearly shows what the client can expect from you.

Key 8: Inform Your Clients of All of Your Available Services - If you are a Civil Engineer, every had clients hire an attorney to prepare and process entitlement applications. An attorney can be charging your client $300 or more per hour and providing a service that is no more effective than if your company had prepared and processed the application. Attorneys love it when your clients think that the best representative for Entitlements is them. Sure for some difficult sites that maybe the case, but 9 out of 10 times they are not. You may be surprised to know that most clients that utilize the services of a lawyer for Entitlements do not know that your firm provides the same services. They may think that you only provide Tentative Maps and Development Plans. That is why it is so important to state your services on all of your marketing materials. Believe it or not most people just do not know what engineers can do, which means we might be leaving thousands of dollars on the table.

Key 9: Cross Promote Your Company and Services to Other Companies - Many engineering companies sub-contract out several engineering tasks like Traffic Impact Analysis, Technical Drainage Studies, Surveying, Structural Analysis, Environmental Impact Studies, Geotechnical Reports, and many other tasks. If your firm provides these types of specialized services, it would be a good idea to let other engineering companies know. In addition, they may also provide a specialize service that would be of benefit to your firm. Your firm may specialized in Water Resources and Land Development, while you may find a firm that specializes in Transportation Engineering. Make an offer that if they will contract with your firm for Technical Drainage Studies, your firm will contract with them to provide Traffic Impact Analysis. Both firms can benefit from the agreement.

Key 10: Joint Venture with other Businesses to Increase Your Services - Often engineering companies will team with other companies to bid for a project; especially government projects. Usually the primary has completed several government contracts, and is sub contracting your firm to handle a small percentage of the work. Larger firms generally team with small business to satisfy the government requirement that a certain percentage of the work must be contracted with a small or disadvantaged businesses. The partnering also allows the companies to provide all of the services necessary to complete the task. Your firm is then not competing with other much larger companies.

Most engineers have excellent technical skills, but not necessarily the same level of expertise in business management. It is the responsibility of the engineer to develop these management skills through continuing education. This continuing education can be obtained through Community Colleges, Universities, Professional Training Programs, Professional Organizations, and online training courses. In most states these continuing education courses qualify for continuing education units (CEU) or Professional Development Hours (PDH).

In Parts 1 and 2, we have discussed 10 key strategies to increase revenues and profits. There is one main key financial indicator that is used to measure whether a business will stay in business, and that is whether or not the firm is creating a profit over a period of time. Without profit the firm will be out of business in short order. You can only leverage so much.

Construction Schools Offer Well-Rounded Education

Construction Schools and technical institutes offer a well-rounded education in various areas of the construction field. An education in construction can benefit students interested in learning out about aspects of construction of single family dwellings and large industrial complexes.

As construction projects continue to grow and expand into new territories, construction continues to be a high demand field. Construction Schools prepare those for construction jobs who enjoy mathematics, planning, directing, and monitoring projects to conclusion, and who enjoy working with their hands and being outdoors.

Construction School programs teach construction skills to workers who must understand contract details and building plans; codes and regulations; all basic principles of math, physics, and engineering; and how to follow through with all construction processes.

Construction Schools provide courses in analytical geometry, calculus, drafting, reading blueprints, building codes and standards, materials, methods, equipment, business communications, information technology, building inspection construction graphics and categorization, construction law, construction safety, inspection, labor laws, site planning, soils and foundations, and structural technology.

Management skills in construction trades are crucial. Construction Schools can provide real experience for learning how to manage all aspects of construction that are happening all at once -- while electricians and plumbers, landscapers, carpenters, masonry workers, and roofers may be working in different areas at the same time.

With a degree or certification from Construction Schools in construction trades, career choices can expand to include cost estimation and cost forecast of the expenses; construction management for completing the job to specification; engineering of coordinating uses of natural resources, chemicals, and biology; and for experienced and detailed carpentry.

Construction School classes for positions in management, carpentry, and inspection prepare students for positions as building inspectors, property managers, and property maintainers.

If you are interested in learning more about Construction Schools and other types of schools, please search our site for more information and resources.

DISCLAIMER: Above is a GENERAL OVERVIEW and may or may not reflect specific practices, courses and/or services associated with ANY ONE particular school(s) that is or is not advertised on

Copyright 2006 - All Rights Reserved
Michael Bustamante, in association with Media Positive Communications, Inc. for

Notice to Publishers: Please feel free to use this article in your Ezine or on your Website; however, ALL links must remain intact and active.

The Construction Manager Job Description

The key responsibility of a construction manager is to ensure the success and proper transition of construction plans and its development indicators according to engineering, architecture and infrastructure requirements.

Among the details that would include in his responsibilities are: To make sure that supplies and construction overlay are chronicled and accounted for by the proper channels according to consumption and deployment plan; Utilize proper manpower resource to maintain a streamlined construction schedule; ensure that the proper safety and quality control mechanisms are laid out as per the recommendation of safety engineers and inspectors. Coordinate completion of the project with corporate and industrial partners to ensure the success and schedule adherence for both infrastructure and manpower.

He will manage schedule and logistics in accordance to mapped construction timelines and deadlines for infrastructure milestones. He is also responsible for labour requirements and proper personnel dispatch mechanisms for designated construction areas. They may report to a safety engineer or coordinate in terms of inspection and compliance monitoring for building and safety codes as well as municipal regulations.

The construction manager acts as a communications liaison, providing details and plan interpretation for contract terms and construction implementation to developers, clients and partners. As a construction manager you will be in charge of contract revision, addendums and memoranda for architects, suppliers, subcontractors and associated faction related to the construction project.

He directly handles shipment and supply requisition in the event of a stock shortage, managing partnerships with construction supply firms and distributors to ensure a smooth changeover and open channels.

We'll Help You Find What You Are Looking For


7 Secrets to Successful Log Home Construction

Many people spend months or even years planning the log home of their dreams. They tour home shows, scour magazines and review house plans with giddy anticipation.

When construction finally starts, their pride and elation can't be denied. After all, as British postmodern novelist Angela Carter wrote, "home is where the heart is."

Although no experience can compare with seeing a dream come to fruition, let's face it, the actual process of building a custom home can create anxiety.

You have to wade through myriad decisions and navigate the ins and outs of dozens of construction steps.

Wouldn't it be nice if there were a way to avoid the common pitfalls?

Well, there is.

Following are seven secrets that log home construction experts and home owners who have gone through the construction process recommend to keep your project on track and within budget.

1. Educate yourself.
Before you even start planning your new home, stop and consider whether you know enough about the processes to ask relevant questions and make the many decisions that are required when building a custom home.

"Be honest with yourself," says log home project consultant, former builder-dealer and author Jim Cooper. "Ask yourself how much you really know about construction." If your answer is "not much," it's time for a crash course.

If you don't take the time to educate yourself, it could lead to costly mistakes.

For example, when working with a surveyor, one of Jim's clients once asked, "How much for the septic field?" The surveyor told the client, he would need to spend "about $800."

"What the surveyor was really telling the client was that to do the engineering drawing for their septic field would cost about $800," recalls Jim. "The septic field itself cost $12,000 to $14,000."

But the client didn't understand the difference between engineering a septic field and actually installing one, so the surveyor's answer was misleading.

2. Don't go it alone.
Whether you employ a general contractor or builder or decide to build your home on your own, you'll still need to collaborate with professionals and subcontractors. If you don't have experience dealing with these pros, or you're not comfortable doing it, you may want to consider hiring a project manager or facilitator. "The cost of this is generally about half the price of a general contractor," says Jim.

For example, The Construction Process Group in Ortonville, Michigan, helps home owners in a variety of ways.

The company's program includes about eight hours of work on a house. They review plans from a design standpoint, examine whether the log home package provides all the materials needed to build the home and review the customer's site.

"We make sure the home owners have thought about all the different ramifications that building out in the country can bring," says partner Guy Huenecke, a long-time expert in the log home field.

"Often they just assume things are available, like access to water. A thorough review lets us assist in developing a realistic budget."

There is also some education about money.

"We help them understand how the cash needs to flow," Guy says.

Even if you don't want to spend money on experts, it pays to seek advice. When Kim and John Wary of Rogers, Arkansas, decided to act as their own builders and general contractors, they knew they were taking a leap of faith.

"There were times that I didn't know if we could do it," says John, "but you can't be afraid to ask for help." They talked to others who had built log homes in their area to learn what the entire process entailed. John even went to job sites to watch construction of other homes during various stages.

Throughout the design, delivery and construction of their home, Kim and John relied heavily on their log package supplier, Original Log Homes in British Columbia, Canada.

"They went above and beyond for us," says John.

"There were times when I would call them every day and ask questions for 20 minutes. But they were always approachable and supportive."

As a backup, the Warys employed the services of a log home builder in their area on a consultative basis. "He built other homes for our supplier," says John. "I only had to call him a few times, but it was a comfort to know that I had that extra support if I needed it."

3. Understand the scope of the work.

Sometimes, despite the best efforts of home owners to stay with their original plan, aspects of a custom-home project can get off budget. When that happens, often the cause can be traced to one of two reasons: A subcontractor low-balled a price, then wrote the contract so loosely it didn't include everything needed to complete the work; or, the bid wasn't accurate because no one completely defined what was expected.

A classic example of the second problem occurs when a home is being assembled.

As the crew raises the logs, they also usually drill holes to run wires for the electrical system. But who ends up routing the openings in the logs for the junction boxes?

Typically, electricians won't do that type of, they think of it as a carpenter's job. And the carpenters consider it part of the electrical work. If neither party has budgeted for the job, you can end up with 12 hours or more of labor costs that aren't covered in your contracts. This can lead to a couple thousand dollars in unanticipated costs, according to Guy.

"You can't have breaks within the scope of the work," Guy says. "You need to be sure everything is covered."

To avoid a problem like this, you need to make sure you understand the entire scope of the work that needs to be done, then communicate what you expect to the subcontractors. At The Construction Process Group, Guy prepares a "scope of work" document. "This clearly defines who does each task so that the bids you receive will be accurate and nothing will come back to bite you," he explains.

4. Develop a budget (and stick to it).
It's easy to give in to the temptation to add fancier features and upgraded appliances. After all, each change may only add a hundred dollars or so to the cost of a home. But it all adds up. "Before you know it, the budget is thousands of dollars off track," says Guy. Letting the budget get away from you can lead to long-term problems.

"Often, when people overspend their budgets, they tend to skimp at the end of the process, when it comes time to stain or seal the logs," says Guy.

"Coatings are one of the products where you really get what you pay for." Skimp here and you could end up with logs that look weathered before their time, or worse, fall victim to rot and insect damage.

To stay on budget, experts suggest you try your hand at one of the financial management software programs on the market, such as QuickBooks, which even sells a specially designed contractor edition. One thing they do not recommend, however, is to purposely overbudget, or create a "fudge factor." By doing so, you can create more problems than you'll avoid.

"That means the budget is off track everywhere," says Construction Process Group partner Jim Christopher, who believes in budgeting realistically. "I tell clients to be prepared to spend an additional 10 percent over that budget for owner-directed expenses," says Jim.

"Then I ask them to show the restraint not to use it."

5. Pitch in.
No matter who you choose to oversee your project, there are creative ways you can stay involved and keep costs down. When Steve Hissong built his own log home in Belleville, Ohio, he looked for subcontractors who were willing to let him work alongside them. "My heating guy knocked $700 off the total cost of my project because we worked together in the evenings," says Steve.

Often referred to as sweat equity, by finishing floors, tile, trim work, sanding and staining yourself, you can save a bundle of money, while taking pride in the fact that you helped to build your own home.

6. Check out your contractors.
Don't pick your contractors by simply looking in the phonebook. When you are spending this kind of money and working on a project of this magnitude, you'll want to base your decision on more informed and personal recommendations. Guy suggests that home owners go to a local lumberyard to inquire about qualified subcontractors.

"That's where the tradespeople do business, not Lowe's," he says.

Your local home builder's association is another possible source for good contractors.

You can find your local chapter by logging on to the National Association of Home Builders' web site ( and clicking on "Contact Us" or by calling 800-368-5242.

Once you've narrowed your choices to a few contractors, ask each one for the names of past customers you can call. Then take the time to check the references and ask probing questions such as did the contractor stay on schedule? Did he accommodate change orders? Did he stay on budget?

Also, ask to visit potential contractors at a job site where they are currently working. "When a job's not finished, you can see a lot," says log home owner Steve Hissong.

"You'll also get a sense for the kind of people who are doing the work, and whether they are using quality tools."

The experts also recommend that when you've narrowed down your list of potential contractors, you get at least three quotes for every job you need to do and everything you need to buy.

It's well worth the effort. "It took a lot of time to get all those bids," says Steve, "and initially I wasn't sure if it was really going to be worth it. But, it was. The house ended up appraising for 30 percent more than I put in it."

7. Respect the professionals.
Although everyone wants to get the best price, you have to accept that working with a contractor is not like buying a used car. "You shouldn't beat down a contractor until you get your bottom dollar," says Guy.

"Your contractor has to make a reasonable amount of money so he can have the time and resources he needs to do a good job."

Come to terms with the fact that no one is going to build your home for free.

The more involved the house is, the more the contractor's fee will likely be.