Management of local contractors during the boom and recession periods

Abstract

The construction demand is fluctuating and will go through a cycle. Hence, small contractor firms that do not have long term planning tend to eliminate out from the industry during the recession period. Although the industry is expanding presently, the demand is not expected to sustain very long, hence, local contractors are urged to develop long term strategies in order for them to thrive in the future. This dissertation is formulated to discuss the strategies that are adopted by local contractors during the boom and recession period. A review on the ERC Construction Working Group Report also been carried out to identify the long term strategies that are recommended by the Economic Review Committee. The author will focus on the issue of the adoption of partnering, develop niche area and export services that are highlighted under the report. The characteristics of the construction industry, construction cycles as well as the construction demand in Singapore are highlighted. It will help to understand the rationale behind the strategies that are adopted by local contractors. To identify the strategies adopted by local contractors, a survey method was carried out to collect primary data. Interview was also conducted to have a better understanding on the perception of the adoption of partnering, develop niche area and export services. From the findings, although local contractors acknowledge the benefits of long term strategies, the mindset of focusing on short term profits prohibits local contractors from realizing the benefits. Hence, local contractors have to change their mindset in order to create a sustainable construction industry in the local context.