Do you enjoy buying and selling property and do not mind getting your hands dirty? If so, then property development could be for you!
Property development can be a lucrative business, but it also comes with some challenges. It is not a business endeavour to undertake lightly. You need to plan your projects well and avoid stretching your finances too much. Otherwise, you could be in for a failure, and failure in this endeavour could break the bank. So, spend time learning the methods, applying your knowledge, and learning from your mistakes. Sure, it requires a lot of effort, and it’s a very risky business. But the rewards will be well worth it!
Here are some tips for property developers when dealing with trade.
- Try to Get a Supplier on a Bulk Deal
One of the challenges you could face in property development is building a good client-supplier relationship. Every project or renovation that you undertake as a property developer requires numerous materials and services, so you need to deal with different suppliers for sourcing. Establishing a solid relationship with suppliers come with significant cost savings. If you have good relationships with contractors, it will be easier to negotiate a bulk deal. For instance, if you need a driveway done on your Birmingham project, try to offer multiple jobs to the contractor to convince them into taking up the job at a much lower price.
Dealing with one contractor for multiple projects come with many benefits. For instance, there will be less paperwork to handle. When you work with several contractors for various projects, you could find yourself swimming in a sea of contracts, documents, folders, and bills. But if you hire a single contractor, you will only have one point of contact for everything. This also allows you to build a trusting and mutually beneficial relationship with the contractor.
Going with a single contractor instead of multiple contractors is also a major time saver. That’s because it simplifies and minimizes the onboarding process. Once you’ve found the contractor you trust, you do not need to spend hours worrying about bringing in new suppliers, getting them up to speed, and so on.
- Make the Most of Scaffolding
Scaffolding is an integral part of the construction industry, so you must consider its use in every project you develop. It remains a valuable life-saving structure for workers regardless of the size of the project. Aside from safety, scaffolding also helps make the task easier.
Scaffolding is a must in project development and makes life easier for the developers. It’s also worth mentioning that scaffolding hastens the project’s pace, helping you beat tight deadlines. In fact, scaffolding could improve productivity due to the increased safety and easy access that the scaffolds provide. If a worker feels comfortable working, productivity will significantly improve, especially in handling physically demanding projects.
But when it comes to getting essential scaffolding, try to make the most of it to maximise your budget. For instance, if you are refitting windows, consider carrying out roof repairs at the same time. That way, you will end up performing two different jobs using the same sets of scaffolding. Experts Get Scaffolding Essex say, it will not only save money, but it will save time as well, considerably.
- Build Relationships
One of the most important tips to becoming a successful property developer is establishing great relationships with everyone you work with. Try to have good relationships with your suppliers, contractors, bankers, attorneys, engineers, and everyone involved in the project. Treat everyone as though they are the most important people in the room. Remember, these relationships can go a long way in your business, especially when the time comes that you need to ask favour from them.
Try to be good even with those not involved in the project. You may not need their services at this time, but you might need them in the future. Being friendly and maintaining good relationships will make it easier to get these people on board if you ever need them in the future.
Having good relationships with the people you work with also allows for better communication. Remember that for a project to be successful, communication is the key. If things are not running on time, you need to know well in advance and be presented with other options that can work best for you. And if a material is not going to fit the brief, you need an alternative to keep the project going. Thus, establishing good relationships is essential for every property developer. It will be much easier to communicate with people and inform them of any changes in the project.
- Always Negotiate on Price
When negotiating with suppliers, you should set objectives for negotiation and think of a strategy right before the negotiation takes place. Dealing with suppliers can be complex, so planning is of vital importance. First, start by identifying your priorities, such as low price, specific delivery schedule, etc. Next, highlight the aspects of the deal that you are happy with and those that you want to discuss more in detail. Encourage the supplier to do the same, but do not reveal your bargaining position right away.
Try not to accept the first offer during your negotiation. Counter the offer or allow the supplier to come back with a different figure if you feel like the offer is overpriced or not fair. Brush-up your bargaining skills to bag a good deal. If you’re sourcing several materials or services from the supplier, you can try to ask for bulk discounts.
Avoid talking about urgent deadlines as this can be used as a pressuring tactic against you. The other party might pressure you into agreeing on a term you are not happy with because they know you are on a tight schedule. Sometimes, the supplier might add unnecessary products or services in the deal to inflate the price. If you do not need them, politely ask them to remove these things and discuss only the cost of the things that you absolutely need for the project.