- Backlogs are your safety net: A healthy backlog cushions against slowdowns and keeps cash flow stable.
- Tariffs squeeze margins: Proactive tariff modeling and escalation clauses are critical to protect profits.
- Clean data equals smart decisions: Standardized, real-time data reduces waste, rework, and risk.
- AI and automation future-proof your operations: Digital tools cut inefficiencies, enable predictive control, and reinforce margins under economic pressure.
- Productivity must scale: Wins on one project should be replicable across your entire portfolio.
Economic uncertainty is nothing new for contractors. Rising interest rates, fluctuating materials prices, supply chain bottlenecks, and labor shortages are just a few of the risks that can derail profitability. But with the right strategies, contractors can build resilience and protect their businesses, even when market conditions are tough.
At STACK, we’ve seen firsthand how contractors who take a proactive approach thrive while others struggle to stay afloat. Below, we’ll explore five proven strategies to strengthen your business and get insights from STACK experts on how our comprehensive platform can help keep you profitable.
1. Build and Maintain a Healthy Backlog
A strong backlog of projects is a critical safety net during uncertain times. It provides contractors with steady cash flow and operational stability even when new opportunities slow down. According to the Associated Builders and Contractors Construction Backlog Indicator, construction backlog rose in July 2025, up 0.4 months from the previous year. That’s good news for contractors.
ABC Chief Economist Anirban Basu says, “Some of that strength can be attributed to the fact that 1 in every 8 ABC members is currently under contract to perform work on a data center project. Backlog in the infrastructure category has also increased considerably over the past year, and public construction activity has outperformed the private sector over the past several months.”
2. Mitigate the Impact of Tariffs on Margins
Tariffs represent an urgent challenge where project stability is at risk. Bidding accurately and protecting profits is essential for survival. Construction Dive reported that 40% of contractors expect tariffs to erode profitability in 2025. According to S&P Global, tariff uncertainty will have a larger impact on the nonresidential construction, with the construction industry overall being the most impacted by tariffs.
When costs are unpredictable, your greatest competitive edge is predictable data. With clean, organized, and connected data, you can bring order to the chaos. Catch red flags early, reduce risk and rework, and strengthen forecasting.
3. Strengthen Data Integrity and Standardization
Strong data is the cornerstone of smarter, more efficient construction. Yet, poor data quality continues to cost the industry billions each year. 90% of construction data is unstructured and not formatted, and 95.5% of the data produced goes unanalyzed (Construction Dive).
By implementing standardized data, you’re investing in future-proofing business growth. Reliable data will support operational efficiency, streamline processes, and give you the ability to forecast revenue and margins.
STACK Insight: – Greg Warman, STACK’s Strategic Solutions Engineer
4. Driving Stronger Financial Performance with AI & Automation
As economic conditions fluctuate, AI and automation are the key to success for resilient construction businesses. From predictive insights to autonomous machinery, this technology combats uncertainty by enhancing efficiency, reducing cost overruns, and safeguarding margins.
According to a recent Autodesk report, organizations that have fully automated workflows and integrated AI enjoy markedly better financial outlooks: 82% feel positive about their financial performance, compared to just 63% of emerging tech users and 52% of beginners.
5. Scale Productivity Improvements Across Projects
Industry-wide construction productivity has lagged for decades. McKinsey calls it a productivity imperative, stressing that firms must digitize and standardize to stay competitive. The key challenge is scaling those gains across an entire portfolio, not just in isolated projects. The industry faces a $40 trillion shortfall in output unless it accepts a digital transformation (McKinsey).
Contractors need a systematic and portfolio-wide approach to scale productivity effectively. Adopting production metrics, prioritizing tech that integrates workflows, leveraging AI as a productivity accelerator, and standardizing data will drive real productivity improvements.
Resilience Requires Foresight
Resilient contractors prepare, adapt, and emerge stronger. By managing backlogs strategically, mitigating tariff impacts, improving data integrity, scaling productivity, and contractors can create a business model that thrives in any economic climate.
STACK is here to help you build that resilience. Come see what we can do for your business today!
