Consultant Update: Contractors Handling Economy

It's great to be able to talk with the consultants who work in this industry. Not only do they know their stuff but because they work with a number of companies throughout the country they have their finger on the pulse of what's going on in this industry and can provide information and insights from their customers -- property managers or contractors -- that I might otherwise not have access to. Had a great conversation with one such consultant earlier this week. He handles more than two dozen accounts and more than half of those are contractors in the pavement maintenance industry. His verdict: Contractors are weathering the year pretty well, with "weathering" being an appropriate term. A number of his contractor clients (and many others he has heard from or heard about) have been battling rain all season and unseasonably cold weather as autumn hit (and as if to prove the point, yesterday parts of the Northeast got hammered with an early snowstorm, as much as 8 inches, with more snow in the offing). Contractors certainly don't need that at this point of the season. But what about his more than a dozen pavement maintenance clients? "They are doing okay," he says. "About half of them have added a service or picked up work in one area or another so their sales and profits for them are up over a year ago." He says he has spent much of his time encouraging them to aggressively pursue more work from existing accounts and to add services that dovetail with their existing business. "That's been a hard sell because everyone wants to cut back, but now is the time when contractors can solidify their hold and even expand their place in their market, and the contractors that have been able to do that have seen very good results." But not all contractors feel they can pursue new work or add services -- they want to cut back. So how are those contractors doing? "Actually, they are doing well," he says. "Some of my clients just don't feel comfortable spending and being aggressive in a market like we've had this year, so I've worked with them in a different way." For those contractors he focused on cost savings, increasing efficiency, and making cuts -- including staffing cuts. "Those contractors in many cases are in markets where work has not been as available as in the past, so they are experiencing fewer sales and will end the year with lower sales volume than last year. But, as a result of their efforts they will see the same profit as last year."