Author: Brett Knox
January 9, 2025 - 4 MIN. READ
In the trades, we often rely on industry experts to predict what’s coming and plan accordingly.
While looking ahead is a smart strategy, relying on predictions can’t prepare you for everything.
The real secret to long-term success is building a business that is ready to adapt. By focusing on contractor business resilience, you’ll not only survive — you’ll create opportunities to grow.
Read on to explore four proven strategies to make your business more resilient.
Why Does Business Resilience Matter in the Trades?
Before going any further, it’s important to understand why contractor business resilience matters.
Over the past few years, you’ve likely encountered these challenges:
- Prices have been volatile for materials. In fact, some supplies, such as switchgear, have gone up by more than 40% since 2020.
- Supply chain challenges have remained a reality since COVID-19. Long lead times are affecting most contractors.
- Demand has also been slow. Due to high inflation and other economic factors, many potential customers are delaying hiring a contractor or planning small projects.
While inflation has started to cool off, high prices and supply chain challenges show no signs of letting up. That’s why the following business resilience strategies can give you a key advantage.
Strategy #1: Understand and Tackle Supply Chain Risks
Supply chain bottlenecks mean long lead times and increased costs. Besides eating into your profits, this also makes jobs hard to plan.
It’s time to address your unique supply chain risks by gaining visibility into your buying activities. Identify the products and services you buy regularly, which prices tend to fluctuate the most, and which suppliers are the most unpredictable when it comes to lead times.
You can then focus on building a better supply chain by growing your supplier network and picking out backup options when prices or lead times increase.
Strategy #2: Diversify Revenues and Opportunities
Is demand low or hard to predict? It might be time to branch out.
Successful diversification can look like:
- Creating new revenue streams with services like electrical or HVAC maintenance plans or home energy assessments.
- Expanding your reach to new markets. If you’re a residential contractor, look into offering your services to local businesses and commercial buildings.
- Specializing to take advantage of the growing demand for electrification services. Learning to install EV chargers, heat pumps, and commercial building electrification solutions will open new doors for your business.
Besides protecting you from fluctuations in demand, diversifying your revenues can boost profit margins. In turn, you’ll have funds to reinvest into projects that increase resilience, such as better training for your workforce, competitive wages to reduce turnover, or new tech solutions.
Strategy #3: Embrace Change and Innovation
Building a strong foundation for your business gives you the flexibility needed to adapt and overcome obstacles.
A key element of this foundation is technology. With many contractors being slow to adopt tech, embracing change and innovation can give you a significant competitive advantage.
For instance, AI can be a powerful tool for lead generation, such as AI chatbots and personalized emails. Experts also believe AI could be the key to bridging the skills gap and training a new generation of trades workers!
AI isn’t the only tech you should consider adopting. Bid management software, project management platforms, and inventory management solutions are worth looking into. Once you master these tools, you can use them to build flexible processes with lower costs.
Strategy #4: Foster a Culture of Innovation
Lastly, embracing a company culture that values innovation can go a long way in making you more resilient.
You can embody this core value by keeping up with the latest trends in the trades, exploring new technologies, and experimenting by testing new use cases for these tools. During business planning, make sure to allocate time and resources so you can carry out a few experiments.
Working with the right people is also instrumental. Employees and partners who share this mindset and understand the importance of innovation will carry your business through difficult times. To empower these agents for change, look into training and upskilling. You can also cement your relationships with innovative vendors by forming partnerships or even working with other contractors to go after larger jobs, especially in the electrification market.
Raiven Supports Contractor Business Resilience
Contractors who take steps to improve business resilience will emerge stronger and ready to seize new opportunities in 2025 and beyond.
Raiven can help. As the leading contractor group buying platform, Raiven offers a tangible solution to supply chain challenges. Adopting Raiven’s AI-powered buying tools or bid management software can be a first step toward building a business that takes advantage of the latest tech innovations.
Summary: Business resilience is the secret to long-term success in the trades. Explore four proven strategies for building a resilient business that can thrive as the trades evolve and face new challenges.
