5 Strategies to Help Construction Leaders Mitigate Risk
Date Posted: June 30, 2026
Posted In: Discussion,
From Construction Business Owner: When the construction industry undergoes changes like tariffs, supply chain constraints and labor shortages, general contractors might be tempted to explore new opportunities for growth beyond their established customer base and expertise.
However, it is during these uncertain times that it is best for companies to evaluate and test their financial, operational and risk resiliency before taking on new and different development projects.
While economic and geopolitical events can affect contractors in every business environment, it is important for contractors to have their most valuable risk discussions around project selection and how their historic successes can be duplicated elsewhere. A long-term project focus can help general contractors become the go-to contractors in their respected specialty. And a well-planned specialization strategy can be one of the best paths to growth and profitability.
When external factors are beyond a contractor’s control, there are five strategies that may help them succeed. These business resiliency practices can be employed and adopted to protect relationships and manage change.
Build Best Practices Around Profitable Projects
Construction companies have one of the steepest failure rates among major industries, according to 2022 Labor Department statistics. This makes it important for contractors to identify their most successful jobs, measure their profit margins and employ technology that can boost safety, efficiency and savings to better understand and build their company’s current resilience and growth potential.
Additional tactics include realistically assessing potential clients and working with transparent customers. A large part of ensuring project success is client fit and getting paid. When selecting which customers to work with, it is important to pay attention to risk factors such as transparency with funding and pricing sources. Clearly outlining details such as payment schedule can save a project from disruption.
While contractors may not have control over the price of materials, they do have control over the time it takes for a customer to make critical decisions. Paying attention to clients who are disorganized or only prioritize money when making decisions can help avoid delays in the timeline.
In addition, encouraging collaboration and participation from new employees, as well as diversifying the workforce, can help increase the experience and acumen of the business. Employees from different backgrounds, ethnicities, races and genders can provide new perspectives that may not have been considered previously.
Project selection is an integral part of the success of a construction company. While there are some factors (like inflation or the tight labor supply) that are beyond a contractor’s control, there are other things to focus on that can ensure the company is prepared for successful project completion.