Developing and launching a new building and construction company
Two existing clients together with MACHUS’ CEO, Mac Radomyski, agreed to launch a building and construction company. The project provided an opportunity to apply some of the business theories and practices that MACHUS would normally recommend to clients, particularly those starting a new business.
The three partners were highly skilled in different aspects of construction and business, including plastering and interior fit outs, civil engineering and business financial management. This variety of skills ensured that each partner was responsible for specific areas of the business. More importantly, their efforts were complementary rather than competing which is a real benefit for new businesses and partnerships.
Initially, bidding for work was centred on the residential extensions and improvements sector. However, the partnership soon realised there were difficulties and challenges working in the residential space which made this segment unattractive.
Mac, as one of the partners, undertook further market research. He found that there was a growing gap in the commercial and civil construction segments, which became the focus of the business.
Solutions, Strategies and Recommendations
Over time, the business focused entirely on the commercial and civil construction segments. Compliance that is, Quality Assurance, Safety and Environmental certifications became the business’s competitive advantage which assisted to gain tender business beyond $1.0M as well as becoming the preferred supplier for government work.
Implementation and Results
The business succeeded in growing from $0.0 to $10.0M/year turnover after its first three years of trading. Commercial accounted for 25% of the work whilst civil works accounted for 75%. The business’s key customers included the Department of Works, Railways Department, Local Government Councils and statutory authorities, which all proved to be a good source of work in what can be a volatile market.