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Summer 2015 – Quarterly Construction Newsletter

In this edition:

Devise Your Exit Strategy—An Early Start Helps Ensure a Good Outcome

Every construction company owner needs an exit strategy — whether that involves transferring the business to family members or selling it to a management team or to a third party. Regardless of the strategy chosen, the earlier the process is started, the smoother the transition will likely be. This article discusses enhancing value and developing an appropriate taxation strategy, while a sidebar looks particularly at goodwill as a tax-saving opportunity. Read more

Surviving the Economic Recovery Depends on Your Cash Flow

As the economy continues to improve, many construction companies are shifting from survival mode into growth mode. That’s good news, but it’s critical for contractors to take a cautious approach to growth — the failure rate for construction companies during an economic recovery is triple the failure rate during an economic downturn. Why? Because growth, while healthy, also puts a strain on a company’s cash flow. This article offers seven tips for managing cash flow wisely. Read more

Do You Know Where Your Company Stands Financially?

 To maintain a competitive edge, it’s critical for a contractor to know where he or she stands financially. One way to do so is by benchmarking. Under this process, a construction company owner selects metrics, or “benchmarks,” to measure his or her construction company’s performance against its own past performance or against other, similar construction businesses. This article explores the details and benefits of this helpful activity. Read more

Contractor’s Toolbox – Your Insurer May Not Cover Construction Defect Claims

Contractors often assume that their commercial general liability insurance policies will cover them in the event of a construction defect claim. But that’s not necessarily the case. As this article explains, coverage may be denied if construction defects either: 1) aren’t considered accidental “occurrences” under applicable state law, or 2) fall within one or more policy exclusions. If a construction company finds that there are gaps in its insurance protection, it might find it wise to purchase supplemental coverage — such as builder’s risk or professional liability coverage. Read more