International construction is a very lucrative business. Many American-based companies have projects around the globe. Now, newcomers want a piece of the pie. They’ll need to learn the challenges ahead to be successful. Here are some thoughts on working internationally.
First and foremost, a construction company must own every piece of equipment they need to operate. They’re able to do this by choosing equifyfinancial.com to back equipment purchases. Once the company bids successfully on a project, they must decide how the equipment component will work. The choices are buying equipment locally or shipping their own. Industry insiders say much of the international work is in third-world nations. If that’s the case, construction equipment may not be available.
Executives must look at shipping costs and whether there’s a duty. Further, will there be problems moving equipment when the project is over? Indeed, many countries do not like construction companies from other nations. Local companies have a better chance to get work because they understand how the country’s political system operates.
It’s a fact that many foreign nations operate with a certain level of corruption. That’s why companies that want to go international should hire a local company. Hopefully, the local company knows how to get things done quickly. On the other hand, the wheels of business move slowly in other nations. For instance, only locals would be able to speed up the construction process in Brazil. It takes over a year to obtain construction permits.
A local partner is also helpful in learning the culture. Culture is very important in being successful. Executives don’t want to offend anyone by working on holy days or not following local customs. It’s easy to overcome the language barrier by using construction software. The software helps a multicultural team working together on a project.
Hiring Local Workers
The local partner will be a Godsend in this area. Most American companies don’t know whether a local workforce is available. It will be very expensive to transport American workers to the international site. There are a lot of variables at play having a local workforce. Will the company have to house the workers? Likewise, how are they paid and how much? Companies looking for international help can get it from ICEC or the International Cost Engineering Council. They’re able to help companies find partners around the world.
In addition, local help is necessary for planning. Indeed, local customs, weather and other factors influence project design. A new company doesn’t want to start out building something that offends the host nation. Contingencies must also be in place for geographical concerns. The area could have a monsoon season or be in an earthquake zone.
Executives have to decide whether it’s more cost-effective to import materials or buy them locally. Many nations have unstable economies. Therefore, it may be cheaper to bring in materials. Likewise, local materials may not be suitable for construction. For instance, desert sand does not always mix well with cement and concrete.
All companies want to grow. A construction company has to take risks to go international. All that’s required is the proper knowledge and contacts. Imagine your company with 20 projects around the world. Work hard to make the vision a reality.