The Generals - Spring/Summer 2011 - (Page 7)
Never apologize for making a profit.
HOW OFTEN DO you ﬁnd yourselves defending a 10 percent gross overhead and proﬁt margin? It’s no secret that the head ofﬁce cost of doing business ranges between 5 and 6 percent for our larger generals, and more like 8 and 9 percent range for our smaller and mid-sized companies. That doesn’t leave much for proﬁt. These days, purchasing scrutiny from the client side has been intensifying, resulting in more risk transfer and affecting our ability to earn a fair proﬁt. More and more, we unfortunately encounter academics and socialists in leadership roles in politics – idealistic birdbrains who urge signiﬁcant corporate tax increases and new regulations in tepid economic waters to fuel their endless spending program wants. This is Canada. We are a compassionate and evolved society. We have developed a social safety net that works to keep our less fortunate out of harm’s way. Those more fortunate readily accept the premium cost and responsibility required to maintain our civil society, to advance education, healthcare and other critical community priorities. We are as well a dynamic free market economy. Our activity and growth drives the greater economy. Our construction industry thrives upon vigorous competition between like qualiﬁed competitors. You have to be aggressive and organized to earn favour on targeted projects. Risk must be quantiﬁed responsibly yet not excessively and managed carefully. Suppliers, subcontractors and partners must be open to negotiation, but general contractors must preserve and protect their proﬁtability. Critical crew safety and quality control programs cannot be compromised; these require investment and resources to maintain, from project start to completion. In the end, for most of us, project success and proﬁtability boils down to organized and dedicated project management commitment. You have to be ﬁrst up in the morning, last home in the evening, working smartly in the hours between, day in and day out. There’s no other silver bullet or secret formula that exists other than the earned power of productivity resulting from hard work and professional preparedness. Nothing most of us do as citizens in our lifetimes will ever make much of a difference so far as tax rates, regulation and social policy goes – there’s nothing more sure than death and taxes. But if you work hard, are honest and accountable, ethical and principled, play by the rules and contribute as expected of us, you might be able to turn more successes than failures in our business – enough to be a survivor; enough to succeed on an ongoing basis. We are privileged to be general contractors in the resource rich province of Ontario. We have so much opportunity before us – don’t blow it. Work hard, be smart; count your blessings. And after all the collective challenges you must navigate through from order acceptance to commissioning and demobilization, in the event you are able to maintain or even increase your margin, celebrate your success and leverage on your momentum. You have worked efﬁciently and within your means – good on you because as entrepreneurs, there’s no well to fall back on if you fail to deliver. You win, we all win; the collective wealth created gets channelled back through society in so many different ways. Keep up the good work that you do. And never apologize for making a proﬁt. Jim Barclay Chairman spring/summer 2011
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Table of Contents for the Digital Edition of The Generals - Spring/Summer 2011
The Generals - Spring/Summer 2011
The Women of OGCA
Infrastructure Ontario: The 10-Year Plan
Life AFTER Stimulus
Are Higher WSIB Rates Inevitable?
Let’s Take a Trip Down Memory Lane
Buttcon Ltd.: Earning Loyalty Through Fairness
Century Group Inc.: Providing Great Service to Clients
Index to Advertisers
The Generals - Spring/Summer 2011