Five business risks the construction industry faces and what you can do to protect your business.
Rea & Associates’ recent webinar, “The Elements of Risk in Construction,” covered five construction industry risks you may not have prepared for yet. Here are, according to the panel of experts and presenters, five business risks the construction industry faces and what you can do to protect your business from them.
Construction Industry Risk #1: Cybersecurity
While you may not consider your construction business a potential target of a cyberattack, the truth is that cyberattacks are common and often target small and midsized companies. Cybersecurity has become even more critical during the COVID-19 crisis.
Even seemingly simple changes to the workforce, such as remote work, means increased susceptibility to cyber threats due to working on unsecured WiFi networks. In fact, according to the FBI’s Crime Complaint Center, since the COVID-19 pandemic began, there has been a 400 percent increase in cyberattacks.
Recognizing the need for cybersecurity protocols, education, and continued education is the first step in protecting your construction business from cyber threats. The cybersecurity and data security services team at Rea & Associates, offers range of both free and paid solutions. Learn more about our options here.
Construction Industry Risk #2: Insurance
Mitigating risk is an essential part of any business strategy. Protecting your assets is critical to long-term success, especially if you’re like the average business owner who has more than half of their net worth tied up in the business.
Insurance coverage is essential in any industry, but this rings especially true in construction. Proper insurance coverage can protect against threats like cyberattacks and employee accidents. It can also protect you if an employee falls ill while at work. The question of employee sickness and insurance coverage is especially relevant right now during the COVID-19 pandemic.
Our most recent webinar, The Elements of Risk in Construction, goes in-depth on this important topic.
Construction Industry Risk #3: State and Local Tax
One of the most significant considerations for any business owner is the nuances of their state and local taxes in their area. Over the years, we have found that the importance of having an accounting firm familiar with local and state taxes has proven to be a crucial planning strategy for Rea and Associates’ clients – whether they are headquartered in Ohio, one of the few states to enact commercial activity tax, or not. In particular, the commercial activity tax can be incredibly challenging to deal with because it’s a duplicate tax.
Navigating tax codes can be incredibly challenging. Having the right team to provide guidance and tax services can make all the difference when dealing with sales and use tax, federal and state tax audits, entity consideration choice, and more.
The extensive state and local tax services team at Rea & Associates is committed to staying up-to-date on all state and local tax matters while also providing extensive internal and external educational programs to provide maximum client satisfaction.
Construction Industry Risk #4: Legal and Contracts
In all industries, business owners should place a high level of importance on ensuring legal protection. This is particularly true for those operating in the construction industry. Construction’s unique role, however, with contracted work makes strong legal protections and consulting even more critical to long-term success.
Firm contracts are incredibly important when you’re working with clients and your independent contractors – not to mention suppliers and other third-parties. You can learn more about the importance of using proper contracts and legal measures to protecting your business during the free, “The Elements of Risk in Construction,” webinar.
Construction Industry Risk #5: Safety and Operations
One of the reasons cybersecurity protection has proven to be so critical is because of the likelihood of cyber-attacks severely disrupting the business, both in the short term and the long term. While many companies were forced to close when COVID-19 began, construction and general contracting remained operational as they were considered “essential” to the overall economic stability of the country. However, just because they were required to stay open and operational, didn’t mean that they could operate as they had in the months prior. Instead, proper precautions needed to be implemented to ensure the continued safety of employees while ensuring the business remained open.
Our panel of experts in cybersecurity, insurance, state and local tax, legal and contracts, and safety operations in the construction space go into each topic in great detail while explaining what business owners can do to mitigate their risks in today’s risk-filled market. Learn more in our on-demand recording of the webinar “The Elements of Risk in Construction.” Fill out the form to receive access to the recording, additional resources, a transcript of the webinar, and more. This webinar is geared explicitly toward construction businesses and will include conversations about various services, from a construction-specific lens.
For even more insight, you can email the construction and real estate services team at Rea & Associates.