NAICS Code 236220-20 - General Contractors-Nonresidential Buildings

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NAICS Code 236220-20 Description (8-Digit)

General Contractors-Nonresidential Buildings is a subdivision of the Commercial and Institutional Building Construction industry. This industry involves the construction of nonresidential buildings such as office buildings, hospitals, schools, and retail stores. General Contractors-Nonresidential Buildings oversee the entire construction process, from planning and design to construction and project management. They are responsible for ensuring that the project is completed on time, within budget, and to the client's specifications.

Hierarchy Navigation for NAICS Code 236220-20

Tools

Tools commonly used in the General Contractors-Nonresidential Buildings industry for day-to-day tasks and operations.

  • Concrete saws
  • Power drills
  • Laser levels
  • Scaffolding
  • Power trowels
  • Excavators
  • Backhoes
  • Bulldozers
  • Cranes
  • Welding equipment
  • Power generators
  • Air compressors
  • Concrete mixers
  • Surveying equipment
  • Jackhammers
  • Skid steers
  • Dump trucks
  • Graders
  • Pavers
  • Vibratory compactors

Industry Examples of General Contractors-Nonresidential Buildings

Common products and services typical of NAICS Code 236220-20, illustrating the main business activities and contributions to the market.

  • Office buildings
  • Hospitals
  • Schools
  • Retail stores
  • Warehouses
  • Factories
  • Research facilities
  • Government buildings
  • Museums
  • Convention centers
  • Sports facilities
  • Theaters
  • Religious buildings
  • Parking garages
  • Airports
  • Data centers
  • Laboratories
  • Hotels
  • Casinos
  • Restaurants

Certifications, Compliance and Licenses for NAICS Code 236220-20 - General Contractors-Nonresidential Buildings

The specific certifications, permits, licenses, and regulatory compliance requirements within the United States for this industry.

  • OSHA 30-Hour Construction Certification: This certification is required for all construction workers and supervisors who work on a construction site. It covers safety and health hazards in the construction industry and is provided by the Occupational Safety and Health Administration (OSHA).
  • LEED Certification: This certification is provided by the U.S. Green Building Council and is awarded to buildings that meet certain environmental standards. It is a widely recognized certification in the construction industry and is becoming increasingly important for nonresidential buildings.
  • ICC Certification: The International Code Council (ICC) provides a range of certifications for building inspectors, plans examiners, and other construction professionals. These certifications are recognized across the United States and demonstrate a high level of expertise in building codes and standards.
  • AIA Certification: The American Institute of Architects (AIA) provides a range of certifications for architects and other design professionals. These certifications demonstrate a high level of expertise in design and construction and are recognized across the United States.
  • ASHE Certification: The American Society for Healthcare Engineering (ASHE) provides a range of certifications for healthcare facility managers, engineers, and other professionals. These certifications demonstrate a high level of expertise in healthcare facility design and construction.

History

A concise historical narrative of NAICS Code 236220-20 covering global milestones and recent developments within the United States.

  • The General Contractors-Nonresidential Buildings industry has a long history of providing construction services for commercial and institutional buildings. In the early 20th century, the industry saw a boom in construction due to the growth of cities and the need for new buildings. During the 1950s and 1960s, the industry experienced a shift towards larger and more complex projects, such as skyscrapers and hospitals. In recent years, the industry has seen advancements in technology, such as Building Information Modeling (BIM) and prefabrication, which have improved efficiency and reduced costs. In the United States, the General Contractors-Nonresidential Buildings industry has experienced significant growth in recent years. The industry has benefited from a strong economy and increased demand for commercial and institutional buildings, such as office buildings, hospitals, and schools. The industry has also seen advancements in technology, such as the use of drones for site inspections and the adoption of green building practices. However, the industry has faced challenges such as a shortage of skilled labor and rising material costs. Overall, the General Contractors-Nonresidential Buildings industry has a rich history of providing construction services for a variety of commercial and institutional buildings, and continues to evolve with advancements in technology and changes in demand.

Future Outlook for General Contractors-Nonresidential Buildings

The anticipated future trajectory of the NAICS 236220-20 industry in the USA, offering insights into potential trends, innovations, and challenges expected to shape its landscape.

  • Growth Prediction: Growing

    The future outlook for the General Contractors-Nonresidential Buildings industry in the USA is positive. The industry is expected to grow in the coming years due to the increasing demand for nonresidential buildings such as hospitals, schools, and office buildings. The growth in the industry is also attributed to the increasing investment in infrastructure development by the government. The industry is also expected to benefit from the increasing use of technology in construction, which is expected to improve efficiency and reduce costs. However, the industry may face challenges such as labor shortages and rising material costs, which may affect profitability. Overall, the industry is expected to experience steady growth in the coming years.

Industry Innovations for NAICS Code 236220-20

Recent groundbreaking advancements and milestones in the General Contractors-Nonresidential Buildings industry, reflecting notable innovations that have reshaped its landscape.

  • Use Of Building Information Modeling (BIM) Technology: BIM technology is being increasingly used in the General Contractors-Nonresidential Buildings industry to improve the efficiency of the construction process. BIM technology allows contractors to create a digital model of the building, which can be used to identify potential issues and optimize the construction process.
  • Green Building Practices: The industry is increasingly adopting green building practices to reduce the environmental impact of construction. This includes the use of sustainable materials, energy-efficient systems, and waste reduction practices.
  • Prefabrication and Modular Construction: Prefabrication and modular construction are being increasingly used in the industry to improve efficiency and reduce costs. This involves the construction of building components off-site, which are then transported to the construction site for assembly.
  • Use Of Drones: Drones are being increasingly used in the industry for tasks such as surveying, inspection, and monitoring. This technology allows contractors to collect data more efficiently and accurately, which can improve the construction process.
  • Virtual and Augmented Reality: Virtual and augmented reality technology is being increasingly used in the industry to improve the design and planning process. This technology allows contractors to create a virtual model of the building, which can be used to identify potential issues and optimize the construction process.

Required Materials or Services for General Contractors-Nonresidential Buildings

This section provides an extensive list of essential materials, equipment and services that are integral to the daily operations and success of the General Contractors-Nonresidential Buildings industry. It highlights the primary inputs that General Contractors-Nonresidential Buildings professionals rely on to perform their core tasks effectively, offering a valuable resource for understanding the critical components that drive industry activities.

Equipment

Compactors: Machines used to compress soil and other materials, ensuring a solid foundation and stability for structures.

Concrete Mixers: Machines that combine cement, aggregate, and water to produce concrete, essential for creating durable foundations and structural elements.

Cranes: Large machines used for lifting and moving heavy materials on construction sites, crucial for erecting tall structures safely and efficiently.

Excavators: Heavy machinery used for digging and moving large amounts of earth, crucial for site preparation and foundation work in nonresidential construction projects.

Forklifts: Vehicles used to lift and move materials around construction sites, enhancing productivity and safety in material handling.

Ladders and Platforms: Essential tools for providing access to elevated areas during construction and maintenance tasks, ensuring worker safety and efficiency.

Scaffolding: Temporary structures that provide support and access for workers during construction, ensuring safety and efficiency when working at heights.

Material

Drywall: A construction material used for creating interior walls and ceilings, offering a smooth surface for finishing and insulation.

Glass Panels: Used in the construction of windows and facades, these materials enhance aesthetics and natural lighting in nonresidential buildings.

Insulation Materials: Products used to reduce heat transfer, essential for energy efficiency and comfort in nonresidential buildings.

Paint and Coatings: Used for finishing surfaces and protecting materials from weathering, contributing to the longevity and appearance of nonresidential buildings.

Paving Materials: Asphalt and concrete used for constructing roads and parking lots, essential for creating durable surfaces in nonresidential developments.

Roofing Materials: Products such as shingles, tiles, and membranes used to cover and protect buildings from weather elements, vital for building durability.

Steel Beams: Structural components used to support buildings and bridges, providing strength and stability to nonresidential structures.

Service

Environmental Consulting: A service that provides expertise on environmental regulations and sustainability practices, helping contractors comply with laws and improve project outcomes.

Legal and Compliance Consulting: Advisory services that help contractors navigate legal requirements and regulations, minimizing risks associated with construction projects.

Project Management Software: Digital tools that assist in planning, executing, and monitoring construction projects, ensuring timely completion and budget adherence.

Safety Training Programs: Educational services that provide construction workers with essential safety knowledge and practices, reducing the risk of accidents on job sites.

Site Surveying: A service that involves measuring and mapping land to determine boundaries and topography, critical for planning construction projects accurately.

Waste Management Services: Services that handle the disposal and recycling of construction debris, promoting environmental responsibility and site cleanliness.

Products and Services Supplied by NAICS Code 236220-20

Explore a detailed compilation of the unique products and services offered by the General Contractors-Nonresidential Buildings industry. This section provides precise examples of how each item is utilized, showcasing the diverse capabilities and contributions of the General Contractors-Nonresidential Buildings to its clients and markets. This section provides an extensive list of essential materials, equipment and services that are integral to the daily operations and success of the General Contractors-Nonresidential Buildings industry. It highlights the primary inputs that General Contractors-Nonresidential Buildings professionals rely on to perform their core tasks effectively, offering a valuable resource for understanding the critical components that drive industry activities.

Service

Building Code Compliance Services: This service ensures that all construction projects adhere to local building codes and regulations. Clients appreciate the peace of mind that comes from knowing their projects meet legal requirements.

Construction Consulting: Providing expert advice on construction methods, materials, and project feasibility, this service helps clients make informed decisions. It is particularly valuable for clients looking to optimize costs and timelines before project initiation.

Design-Build Services: Offering a streamlined approach, this service integrates both design and construction phases, allowing for enhanced collaboration and efficiency. Clients appreciate the single point of responsibility, which simplifies the project delivery process.

General Contracting Services: This service includes overseeing all aspects of a construction project, from hiring subcontractors to managing schedules and budgets. Clients rely on general contractors to coordinate the various elements of construction effectively.

Land Surveying Services: Involves measuring and mapping land to determine property boundaries and topography. This service is essential for planning construction projects and ensuring proper site layout, which is crucial for project success.

Project Management Services: This service encompasses the planning, execution, and oversight of construction projects, ensuring that timelines, budgets, and specifications are met. Clients benefit from organized workflows and effective communication throughout the construction process.

Renovation and Remodeling Services: This service focuses on updating and improving existing nonresidential buildings, enhancing functionality and aesthetics. Clients often seek these services to modernize their facilities or adapt to new business needs.

Safety Management Services: These services ensure compliance with safety regulations and standards on construction sites. Clients value the proactive approach to safety, which minimizes risks and protects workers during the construction process.

Site Preparation Services: Involves clearing, grading, and preparing a construction site for building. This essential step ensures that the foundation is stable and ready for construction, which is crucial for the longevity and safety of the structure.

Material

Concrete: A fundamental building material, concrete is used for foundations, walls, and floors. Its strength and durability make it a preferred choice for nonresidential structures, ensuring long-lasting performance under various conditions.

Drywall: Used for interior walls and ceilings, drywall is a lightweight material that allows for quick installation and finishing. It provides a smooth surface for painting and other finishes, making it a staple in nonresidential construction.

Glass and Glazing Products: Used for windows, facades, and interior partitions, these materials enhance aesthetics and natural light in buildings. Clients often choose glass products for their modern look and energy efficiency.

Insulation Materials: Used to improve energy efficiency and comfort within buildings, insulation materials are critical in nonresidential construction. Clients benefit from reduced energy costs and enhanced indoor environments.

Roofing Materials: Including options like asphalt shingles, metal panels, and membrane systems, these materials are crucial for protecting buildings from the elements. Clients choose roofing materials based on durability, cost, and aesthetic preferences.

Steel Beams: These structural components provide essential support for large buildings, allowing for open spaces and high ceilings. Clients benefit from the strength and versatility of steel beams in their construction projects.

Equipment

Concrete Mixers: These machines are used to combine cement, water, and aggregates to create concrete. Their role is crucial in ensuring that the concrete is mixed uniformly, which is essential for the strength and durability of the finished product.

Cranes: Used for lifting and moving heavy materials, cranes are vital for constructing multi-story buildings. Their ability to reach high elevations allows for the safe and efficient placement of structural components.

Excavators: These heavy machines are essential for digging and moving earth during site preparation and foundation work. Their versatility allows contractors to perform a variety of tasks efficiently, making them indispensable on construction sites.

Forklifts: These vehicles are used to lift and move heavy materials around construction sites. Their maneuverability and lifting capacity make them essential for efficient material handling during construction projects.

Scaffolding: Temporary structures that provide support and access for workers during construction, scaffolding is essential for safety and efficiency. Clients benefit from its ability to facilitate work at various heights.

Comprehensive PESTLE Analysis for General Contractors-Nonresidential Buildings

A thorough examination of the General Contractors-Nonresidential Buildings industry’s external dynamics, focusing on the political, economic, social, technological, legal, and environmental factors that shape its operations and strategic direction.

Political Factors

  • Infrastructure Investment Policies

    Description: Government policies regarding infrastructure investment significantly impact the construction of nonresidential buildings. Recent federal initiatives aimed at improving infrastructure have led to increased funding and projects across the country, particularly in urban areas.

    Impact: These policies can lead to a surge in demand for construction services, benefiting general contractors. However, reliance on government funding can create uncertainty, especially during budgetary constraints or political changes, affecting project timelines and profitability.

    Trend Analysis: Historically, infrastructure investment has fluctuated with political administrations. Currently, there is a trend towards increased investment, particularly in renewable energy and public facilities, with predictions of sustained growth in the coming years. The certainty of this trend is high, driven by bipartisan support for infrastructure improvements.

    Trend: Increasing
    Relevance: High
  • Regulatory Changes in Construction Codes

    Description: Changes in construction codes and regulations at the state and local levels can significantly affect project planning and execution. Recent updates have focused on sustainability and safety standards, requiring contractors to adapt their practices accordingly.

    Impact: Compliance with new regulations can increase operational costs and extend project timelines, impacting profitability. Contractors must invest in training and technology to meet these standards, which can pose challenges for smaller firms with limited resources.

    Trend Analysis: The trend towards stricter construction regulations has been increasing, with a high level of certainty regarding its impact on the industry. This trend is driven by growing public awareness of safety and environmental issues, necessitating proactive compliance measures from contractors.

    Trend: Increasing
    Relevance: High

Economic Factors

  • Construction Market Demand

    Description: The demand for nonresidential construction is influenced by economic conditions, including business investment and consumer confidence. Recent economic recovery post-pandemic has led to increased investments in commercial real estate and infrastructure projects.

    Impact: A robust demand environment can lead to higher revenues and profitability for general contractors. However, economic downturns can result in project cancellations or delays, impacting cash flow and operational stability.

    Trend Analysis: The construction market demand has shown a strong upward trend following the pandemic, with predictions of continued growth as businesses expand and invest in new facilities. The level of certainty regarding this trend is high, supported by economic indicators and market analysis.

    Trend: Increasing
    Relevance: High
  • Material Costs and Supply Chain Issues

    Description: Fluctuations in material costs and ongoing supply chain disruptions have significantly impacted the construction industry. Recent global events have led to shortages and increased prices for essential materials like steel and lumber.

    Impact: Rising material costs can squeeze profit margins for contractors, forcing them to adjust pricing strategies or absorb costs. Supply chain issues can lead to project delays, impacting timelines and client satisfaction, which can have long-term repercussions on business relationships.

    Trend Analysis: The trend of increasing material costs has been evident over the past few years, with predictions of continued volatility due to geopolitical tensions and market dynamics. The certainty of this trend is medium, influenced by global supply chain recovery efforts.

    Trend: Increasing
    Relevance: High

Social Factors

  • Workforce Development and Labor Shortages

    Description: The construction industry is facing significant labor shortages, exacerbated by an aging workforce and a lack of skilled labor. Recent initiatives to promote vocational training and apprenticeships aim to address these challenges.

    Impact: Labor shortages can lead to project delays and increased labor costs, impacting overall project viability. Contractors who invest in workforce development may gain a competitive edge by ensuring a skilled labor pool, while those who do not may struggle to meet project demands.

    Trend Analysis: The trend of labor shortages has been increasing, with a high level of certainty regarding its impact on the industry. Efforts to attract younger workers and promote construction careers are ongoing, but challenges remain in changing perceptions about the industry.

    Trend: Increasing
    Relevance: High
  • Sustainability and Green Building Practices

    Description: There is a growing emphasis on sustainability in construction, with clients increasingly seeking green building certifications and environmentally friendly practices. This trend is driven by consumer demand and regulatory pressures for sustainable development.

    Impact: Adopting sustainable practices can enhance a contractor's marketability and align with client values, potentially leading to increased project opportunities. However, transitioning to green building practices may require significant investment and changes in operational procedures.

    Trend Analysis: The trend towards sustainability in construction has been steadily increasing, with a high level of certainty regarding its future trajectory. This shift is supported by regulatory changes and growing public awareness of environmental issues.

    Trend: Increasing
    Relevance: High

Technological Factors

  • Advancements in Construction Technology

    Description: Innovations in construction technology, such as Building Information Modeling (BIM) and prefabrication, are transforming project management and execution. These technologies enhance efficiency and accuracy in the construction process.

    Impact: Investing in advanced construction technologies can lead to improved project outcomes and operational efficiency, allowing contractors to differentiate themselves in a competitive market. However, the initial investment can be substantial, posing a barrier for smaller firms.

    Trend Analysis: The trend towards adopting new construction technologies has been growing, with many contractors investing in modernization to stay competitive. The certainty of this trend is high, driven by the need for efficiency and cost-effectiveness in project delivery.

    Trend: Increasing
    Relevance: High
  • Digital Transformation and Project Management Tools

    Description: The rise of digital tools for project management and collaboration is reshaping how construction projects are planned and executed. Technologies such as cloud-based platforms and mobile applications facilitate real-time communication and data sharing.

    Impact: Utilizing digital tools can enhance project coordination and reduce errors, leading to improved timelines and cost management. However, contractors must invest in training and technology adoption, which can be challenging for those with limited resources.

    Trend Analysis: The trend of digital transformation in construction has shown a consistent upward trajectory, with predictions indicating continued expansion as more firms recognize the benefits of technology. The level of certainty regarding this trend is high, influenced by industry demands for efficiency and transparency.

    Trend: Increasing
    Relevance: High

Legal Factors

  • Contract Law and Liability Issues

    Description: Contract law governs the relationships between contractors, clients, and subcontractors, with liability issues being a significant concern. Recent legal developments have emphasized the importance of clear contracts and risk management strategies.

    Impact: Understanding and navigating contract law is crucial for contractors to avoid disputes and potential financial losses. Failure to manage liability can result in costly legal battles and damage to reputation, impacting future business opportunities.

    Trend Analysis: The trend towards stricter contract enforcement and liability awareness has been increasing, with a high level of certainty regarding its impact on the industry. This trend is driven by rising litigation costs and the need for better risk management practices.

    Trend: Increasing
    Relevance: High
  • Health and Safety Regulations

    Description: Health and safety regulations are critical in the construction industry, ensuring worker safety on job sites. Recent updates to OSHA regulations have increased compliance requirements for contractors, impacting operational practices.

    Impact: Compliance with health and safety regulations is essential to avoid penalties and ensure worker safety. Non-compliance can lead to accidents, legal issues, and increased insurance costs, affecting overall project viability and contractor reputation.

    Trend Analysis: The trend towards stricter health and safety regulations has been increasing, with a high level of certainty regarding its impact on the industry. This trend is driven by heightened awareness of worker safety and advocacy for better working conditions.

    Trend: Increasing
    Relevance: High

Economical Factors

  • Impact of Climate Change on Construction

    Description: Climate change poses significant risks to the construction industry, affecting project planning and execution. Increased frequency of extreme weather events can disrupt construction schedules and impact material availability.

    Impact: The effects of climate change can lead to increased costs and project delays, necessitating adaptive strategies from contractors. Companies may need to invest in resilient construction practices to mitigate these risks, impacting long-term sustainability and operational costs.

    Trend Analysis: The trend of climate change impacts is increasing, with a high level of certainty regarding its effects on construction. This trend is driven by scientific consensus and observable changes in weather patterns, necessitating proactive measures from industry stakeholders.

    Trend: Increasing
    Relevance: High
  • Environmental Regulations and Compliance

    Description: Environmental regulations govern construction practices, focusing on minimizing environmental impact. Recent regulations have emphasized sustainable practices and waste management, requiring contractors to adapt their operations.

    Impact: Compliance with environmental regulations can lead to increased operational costs and necessitate investments in sustainable practices. However, failure to comply can result in legal penalties and damage to reputation, affecting long-term business viability.

    Trend Analysis: The trend towards stricter environmental regulations has been steadily increasing, with a high level of certainty regarding its future trajectory. This shift is supported by growing public awareness of environmental issues and advocacy for sustainable development practices.

    Trend: Increasing
    Relevance: High

Value Chain Analysis for NAICS 236220-20

An in-depth look at the General Contractors-Nonresidential Buildings industry's value chain, highlighting its role, key activities, and efficiency strategies, along with its unique value drivers and competitive strengths.

Value Chain Position

Category: Service Provider
Value Stage: Final
Description: This industry operates as a service provider in the construction sector, focusing on the management and execution of nonresidential building projects. General contractors oversee the entire construction process, ensuring that projects are completed on time, within budget, and to the required specifications.

Upstream Industries

Downstream Industries

  • Industrial Building Construction - NAICS 236210
    Importance: Critical
    Description: General contractors deliver completed nonresidential buildings to commercial and institutional clients, such as schools and hospitals. The quality of the construction directly affects the operational efficiency and safety of these facilities, making this relationship essential.
  • Government Procurement
    Importance: Important
    Description: Many contractors engage in government projects, constructing public buildings and infrastructure. These projects require adherence to strict regulations and quality standards, impacting the contractor's reputation and future opportunities.
  • Direct to Consumer
    Importance: Supplementary
    Description: Some contractors may engage directly with business owners or private clients for custom projects. This relationship allows for tailored services and can enhance customer satisfaction through personalized attention and quality assurance.

Primary Activities

Inbound Logistics: Receiving and handling processes involve the careful coordination of materials and equipment deliveries to construction sites. Contractors implement inventory management systems to track supplies and ensure timely availability of resources. Quality control measures include inspecting materials upon arrival to verify compliance with project specifications, while challenges such as delays in supply chains are mitigated through strategic supplier relationships.

Operations: Core processes encompass project planning, site preparation, construction management, and quality assurance. Contractors follow industry-standard procedures, including obtaining necessary permits and conducting regular inspections to ensure compliance with building codes. Quality management practices involve continuous monitoring of construction activities to maintain high standards and address issues proactively.

Outbound Logistics: Distribution methods primarily involve the completion and handover of constructed buildings to clients. Quality preservation during this phase is ensured through thorough inspections and final walkthroughs with clients to address any concerns before project closure. Common practices include detailed documentation of project completion and compliance with contractual obligations.

Marketing & Sales: Marketing approaches often include networking within the construction industry, showcasing completed projects through portfolios, and participating in trade shows. Customer relationship practices focus on building trust through transparency and effective communication throughout the project lifecycle. Sales processes typically involve responding to bids and proposals, emphasizing the contractor's experience and reliability.

Support Activities

Infrastructure: Management systems in the industry include project management software that aids in tracking progress, budgets, and timelines. Organizational structures often consist of project managers, site supervisors, and skilled labor teams that collaborate to ensure project success. Planning and control systems are essential for scheduling tasks and resource allocation effectively.

Human Resource Management: Workforce requirements include skilled labor for various construction trades, with practices focusing on ongoing training in safety and construction techniques. Development approaches may involve apprenticeships and certification programs to enhance workers' skills and ensure compliance with industry standards.

Technology Development: Key technologies include Building Information Modeling (BIM) software, which facilitates design visualization and project coordination. Innovation practices focus on adopting new construction methods and materials that improve efficiency and sustainability. Industry-standard systems often involve the use of drones for site surveys and progress monitoring.

Procurement: Sourcing strategies involve establishing long-term relationships with reliable suppliers for materials and equipment. Supplier relationship management is crucial for negotiating favorable terms and ensuring timely deliveries, while purchasing practices often emphasize cost-effectiveness and quality assurance.

Value Chain Efficiency

Process Efficiency: Operational effectiveness is measured through project completion times and adherence to budgets. Common efficiency measures include tracking labor productivity and material usage to optimize costs. Industry benchmarks are established based on historical project performance and regional standards.

Integration Efficiency: Coordination methods involve regular communication between contractors, subcontractors, and suppliers to ensure alignment on project timelines and quality expectations. Communication systems often include digital platforms for real-time updates on project status and resource availability.

Resource Utilization: Resource management practices focus on optimizing labor and material usage to minimize waste and reduce costs. Optimization approaches may involve scheduling techniques that align labor availability with project needs, adhering to industry standards for efficiency and sustainability.

Value Chain Summary

Key Value Drivers: Primary sources of value creation include effective project management, strong supplier relationships, and high-quality construction practices. Critical success factors involve maintaining safety standards and delivering projects on time and within budget, which are essential for client satisfaction and repeat business.

Competitive Position: Sources of competitive advantage include a proven track record of successful projects and the ability to adapt to client needs. Industry positioning is influenced by reputation, quality of work, and relationships with key stakeholders, impacting market dynamics and opportunities.

Challenges & Opportunities: Current industry challenges include labor shortages, rising material costs, and regulatory compliance. Future trends may involve increased demand for sustainable building practices and smart building technologies, presenting opportunities for contractors to innovate and enhance their service offerings.

SWOT Analysis for NAICS 236220-20 - General Contractors-Nonresidential Buildings

A focused SWOT analysis that examines the strengths, weaknesses, opportunities, and threats facing the General Contractors-Nonresidential Buildings industry within the US market. This section provides insights into current conditions, strategic interactions, and future growth potential.

Strengths

Industry Infrastructure and Resources: The industry benefits from a robust infrastructure that includes established construction facilities, advanced machinery, and a network of suppliers. This strong infrastructure supports efficient project execution and enhances the ability to meet diverse client needs, with many firms investing in modern technologies to improve productivity and reduce delays.

Technological Capabilities: Technological advancements in construction methods, such as Building Information Modeling (BIM) and prefabrication techniques, provide significant advantages. The industry exhibits a strong level of innovation, with firms adopting new technologies that enhance project efficiency and quality, ensuring competitiveness in a rapidly evolving market.

Market Position: The industry holds a strong position within the broader construction sector, characterized by a significant market share in nonresidential projects. Established relationships with clients and a reputation for quality contribute to its competitive strength, although there is ongoing pressure from emerging contractors.

Financial Health: Financial performance across the industry is generally strong, with many firms reporting healthy profit margins and stable revenue growth. The financial health is supported by consistent demand for nonresidential construction, although fluctuations in material costs can impact profitability.

Supply Chain Advantages: The industry enjoys robust supply chain networks that facilitate efficient procurement of materials and equipment. Strong relationships with suppliers and subcontractors enhance operational efficiency, allowing for timely project completion and cost management.

Workforce Expertise: The labor force in this industry is skilled and knowledgeable, with many workers having specialized training in construction management and trades. This expertise contributes to high project standards and operational efficiency, although there is a need for ongoing training to keep pace with technological advancements.

Weaknesses

Structural Inefficiencies: Some firms face structural inefficiencies due to outdated project management practices or inadequate resource allocation, leading to increased operational costs. These inefficiencies can hinder competitiveness, particularly when compared to more agile competitors.

Cost Structures: The industry grapples with rising costs associated with labor, materials, and compliance with safety regulations. These cost pressures can squeeze profit margins, necessitating careful management of pricing strategies and operational efficiencies.

Technology Gaps: While some firms are technologically advanced, others lag in adopting new construction technologies. This gap can result in lower productivity and higher operational costs, impacting overall competitiveness in the market.

Resource Limitations: The industry is vulnerable to fluctuations in the availability of skilled labor and construction materials, particularly due to economic cycles and supply chain disruptions. These resource limitations can delay project timelines and increase costs.

Regulatory Compliance Issues: Navigating the complex landscape of construction regulations poses challenges for many firms. Compliance costs can be significant, and failure to meet regulatory standards can lead to penalties and reputational damage.

Market Access Barriers: Entering new markets can be challenging due to established competition and regulatory hurdles. Firms may face difficulties in gaining contracts or meeting local regulatory requirements, limiting growth opportunities.

Opportunities

Market Growth Potential: There is significant potential for market growth driven by increasing demand for nonresidential buildings, particularly in sectors like healthcare, education, and retail. The trend towards sustainable construction practices presents opportunities for firms to expand their offerings and capture new market segments.

Emerging Technologies: Advancements in construction technologies, such as drones for site surveying and augmented reality for project visualization, offer opportunities for enhancing project efficiency and accuracy. These technologies can lead to increased productivity and reduced waste.

Economic Trends: Favorable economic conditions, including rising investments in infrastructure and commercial real estate, support growth in the nonresidential construction market. As businesses expand and new projects emerge, demand for construction services is expected to rise.

Regulatory Changes: Potential regulatory changes aimed at promoting green building practices and energy efficiency could benefit the industry. Firms that adapt to these changes by offering sustainable construction solutions may gain a competitive edge.

Consumer Behavior Shifts: Shifts in consumer preferences towards environmentally friendly and energy-efficient buildings create opportunities for growth. Firms that align their project offerings with these trends can attract a broader client base and enhance brand loyalty.

Threats

Competitive Pressures: Intense competition from both established firms and new entrants poses a significant threat to market share. Companies must continuously innovate and differentiate their services to maintain a competitive edge in a crowded marketplace.

Economic Uncertainties: Economic fluctuations, including inflation and changes in government spending, can impact demand for nonresidential construction. Firms must remain agile to adapt to these uncertainties and mitigate potential impacts on project pipelines.

Regulatory Challenges: The potential for stricter regulations regarding construction safety and environmental standards can pose challenges for the industry. Firms must invest in compliance measures to avoid penalties and ensure project viability.

Technological Disruption: Emerging technologies in construction automation and modular building could disrupt traditional construction methods. Companies need to monitor these trends closely and innovate to stay relevant.

Environmental Concerns: Increasing scrutiny on environmental sustainability practices poses challenges for the industry. Companies must adopt sustainable practices to meet consumer expectations and regulatory requirements.

SWOT Summary

Strategic Position: The industry currently enjoys a strong market position, bolstered by robust demand for nonresidential construction services. However, challenges such as rising costs and competitive pressures necessitate strategic innovation and adaptation to maintain growth. The future trajectory appears promising, with opportunities for expansion into new markets and project types, provided that companies can navigate the complexities of regulatory compliance and supply chain management.

Key Interactions

  • The strong market position interacts with emerging technologies, as firms that leverage new construction methods can enhance project efficiency and competitiveness. This interaction is critical for maintaining market share and driving growth.
  • Financial health and cost structures are interconnected, as improved financial performance can enable investments in technology that reduce operational costs. This relationship is vital for long-term sustainability.
  • Consumer behavior shifts towards sustainable building practices create opportunities for market growth, influencing firms to innovate and diversify their service offerings. This interaction is high in strategic importance as it drives industry evolution.
  • Regulatory compliance issues can impact financial health, as non-compliance can lead to penalties that affect profitability. Companies must prioritize compliance to safeguard their financial stability.
  • Competitive pressures and market access barriers are interconnected, as strong competition can make it more challenging for new entrants to gain market share. This interaction highlights the need for strategic positioning and differentiation.
  • Supply chain advantages can mitigate resource limitations, as strong relationships with suppliers can ensure a steady flow of materials. This relationship is critical for maintaining operational efficiency.
  • Technological gaps can hinder market position, as firms that fail to innovate may lose competitive ground. Addressing these gaps is essential for sustaining industry relevance.

Growth Potential: The growth prospects for the industry are robust, driven by increasing demand for nonresidential buildings across various sectors. Key growth drivers include the rising popularity of sustainable construction practices, advancements in construction technologies, and favorable economic conditions. Market expansion opportunities exist in both urban and suburban areas, particularly as businesses seek to expand their physical presence. However, challenges such as resource limitations and regulatory compliance must be addressed to fully realize this potential. The timeline for growth realization is projected over the next five to ten years, contingent on successful adaptation to market trends and consumer preferences.

Risk Assessment: The overall risk level for the industry is moderate, with key risk factors including economic uncertainties, competitive pressures, and supply chain vulnerabilities. Industry players must be vigilant in monitoring external threats, such as changes in consumer behavior and regulatory landscapes. Effective risk management strategies, including diversification of suppliers and investment in technology, can mitigate potential impacts. Long-term risk management approaches should focus on sustainability and adaptability to changing market conditions. The timeline for risk evolution is ongoing, necessitating proactive measures to safeguard against emerging threats.

Strategic Recommendations

  • Prioritize investment in advanced construction technologies to enhance efficiency and project quality. This recommendation is critical due to the potential for significant cost savings and improved market competitiveness. Implementation complexity is moderate, requiring capital investment and training. A timeline of 1-2 years is suggested for initial investments, with ongoing evaluations for further advancements.
  • Develop a comprehensive sustainability strategy to address environmental concerns and meet client expectations. This initiative is of high priority as it can enhance brand reputation and compliance with regulations. Implementation complexity is high, necessitating collaboration across the supply chain. A timeline of 2-3 years is recommended for full integration.
  • Expand service offerings to include sustainable construction solutions in response to shifting client preferences. This recommendation is important for capturing new market segments and driving growth. Implementation complexity is moderate, involving market research and service development. A timeline of 1-2 years is suggested for initial service launches.
  • Enhance regulatory compliance measures to mitigate risks associated with non-compliance. This recommendation is crucial for maintaining financial health and avoiding penalties. Implementation complexity is manageable, requiring staff training and process adjustments. A timeline of 6-12 months is recommended for initial compliance audits.
  • Strengthen supply chain relationships to ensure stability in material availability. This recommendation is vital for mitigating risks related to resource limitations. Implementation complexity is low, focusing on communication and collaboration with suppliers. A timeline of 1 year is suggested for establishing stronger partnerships.

Geographic and Site Features Analysis for NAICS 236220-20

An exploration of how geographic and site-specific factors impact the operations of the General Contractors-Nonresidential Buildings industry in the US, focusing on location, topography, climate, vegetation, zoning, infrastructure, and cultural context.

Location: Operations thrive in urban and suburban areas where demand for office buildings, schools, and hospitals is high. Regions with strong economic growth, such as the Southeast and Southwest, provide ample opportunities for new construction projects. Proximity to suppliers and skilled labor is crucial, as it reduces transportation costs and enhances project efficiency. Areas with favorable zoning laws and infrastructure support further facilitate successful operations in this industry.

Topography: Flat and accessible terrain is ideal for constructing large nonresidential buildings, as it allows for easier site preparation and construction logistics. Regions with minimal geological hazards, such as earthquakes or flooding, present fewer challenges for construction projects. In contrast, hilly or mountainous areas may require additional engineering solutions, increasing project complexity and costs. Locations with stable soil conditions are preferred to ensure the structural integrity of buildings.

Climate: Moderate climates are advantageous for construction activities, as extreme weather can delay projects and increase costs. Seasonal variations, such as winter snow in northern states, can impact construction schedules, necessitating careful planning. Regions with milder winters allow for year-round construction, enhancing productivity. Additionally, climate considerations influence material selection and building design to ensure energy efficiency and resilience against local weather patterns.

Vegetation: Construction sites must often clear vegetation, which can impact local ecosystems and require compliance with environmental regulations. Areas with dense vegetation may pose challenges for site preparation and increase project timelines. Effective vegetation management practices are essential to minimize environmental impact and adhere to local ordinances. Additionally, landscaping requirements for nonresidential buildings can enhance aesthetic appeal and contribute to sustainability efforts.

Zoning and Land Use: Zoning regulations significantly influence where nonresidential buildings can be constructed, with specific designations for commercial and institutional use. Compliance with local land use plans is essential to secure necessary permits and approvals. Variations in zoning laws across regions can affect project timelines and costs, as developers must navigate different regulatory environments. Understanding local zoning requirements is crucial for successful project execution and minimizing delays.

Infrastructure: Robust infrastructure is vital for the successful operation of nonresidential construction projects, including access to transportation networks for material delivery and workforce commuting. Adequate utility services, such as water, electricity, and sewage systems, are essential for construction activities and future building operations. Communication infrastructure is also critical for project management and coordination among various stakeholders. Areas with well-developed infrastructure support efficient construction processes and timely project completion.

Cultural and Historical: Community acceptance of nonresidential construction projects can vary based on historical context and local attitudes towards development. Regions with a history of industrial growth may be more receptive to new construction, while areas with strong preservation movements may resist change. Engaging with local communities and addressing concerns about environmental impact and traffic can foster positive relationships. Understanding cultural dynamics is essential for successful project integration and long-term community support.

In-Depth Marketing Analysis

A detailed overview of the General Contractors-Nonresidential Buildings industry’s market dynamics, competitive landscape, and operational conditions, highlighting the unique factors influencing its day-to-day activities.

Market Overview

Market Size: Large

Description: This industry encompasses the construction of nonresidential buildings, including office buildings, hospitals, schools, and retail stores. General contractors manage the entire construction process, ensuring projects are completed on time and within budget while adhering to client specifications.

Market Stage: Mature. The industry is in a mature stage characterized by established practices in project management, regulatory compliance, and a stable demand for nonresidential construction driven by urban development and infrastructure needs.

Geographic Distribution: Regional. Operations are typically concentrated in urban areas where nonresidential construction demand is highest, with significant activity in metropolitan regions across the United States.

Characteristics

  • Project Management Expertise: Daily operations involve comprehensive project management skills, including scheduling, budgeting, and resource allocation, ensuring that all aspects of construction are coordinated effectively to meet deadlines.
  • Regulatory Compliance: Contractors must navigate complex regulatory environments, including zoning laws, building codes, and safety regulations, which dictate operational practices and project timelines.
  • Skilled Labor Utilization: The industry relies heavily on skilled labor, requiring contractors to manage workforce training, safety protocols, and labor relations to maintain productivity and quality standards.
  • Supply Chain Coordination: Effective supply chain management is critical, as contractors must coordinate the timely delivery of materials and equipment to avoid project delays and ensure efficient construction workflows.

Market Structure

Market Concentration: Fragmented. The market is characterized by a large number of small to medium-sized contractors, with a few large firms dominating major projects, leading to a competitive landscape where local contractors often serve specific niches.

Segments

  • Office Building Construction: This segment focuses on constructing office spaces, requiring specialized knowledge in commercial design, tenant improvements, and adherence to corporate standards.
  • Healthcare Facility Construction: Contractors in this segment must comply with stringent health regulations and design standards, often involving complex project management due to the specialized nature of healthcare environments.
  • Educational Institution Construction: This segment involves building schools and universities, requiring collaboration with educational authorities and adherence to specific educational facility standards.

Distribution Channels

  • Direct Contracting: General contractors typically engage directly with clients, including businesses and government entities, to secure contracts for construction projects, emphasizing relationship management and reputation.
  • Subcontracting Networks: Contractors often utilize subcontractors for specialized tasks such as electrical, plumbing, and HVAC work, necessitating effective coordination and management of subcontractor performance.

Success Factors

  • Reputation and Experience: A strong reputation and proven track record in delivering quality projects on time are critical for securing contracts and maintaining client relationships.
  • Financial Stability: Financial resources are essential for managing cash flow during projects, as contractors often face upfront costs before receiving payment upon project completion.
  • Adaptability to Market Trends: The ability to adapt to changing market demands, such as sustainable building practices and technological advancements, is crucial for maintaining competitiveness.

Demand Analysis

  • Buyer Behavior

    Types: Primary buyers include corporations seeking office space, healthcare providers needing specialized facilities, and educational institutions requiring new buildings or renovations. Each buyer type has distinct project requirements and timelines.

    Preferences: Buyers prioritize contractors with proven experience, strong project management capabilities, and a commitment to quality and safety standards.
  • Seasonality

    Level: Moderate
    Construction activities may experience seasonal fluctuations, with increased activity during warmer months, although many projects are planned year-round to align with fiscal budgets.

Demand Drivers

  • Economic Growth: Demand for nonresidential construction is closely tied to economic conditions, with increased business activity and investment driving the need for new office and commercial spaces.
  • Urbanization Trends: As populations grow in urban areas, there is a heightened demand for nonresidential buildings, including retail and service establishments, to accommodate expanding communities.
  • Government Infrastructure Spending: Public sector investment in infrastructure projects significantly influences demand, as government contracts often represent a substantial portion of nonresidential construction activity.

Competitive Landscape

  • Competition

    Level: High
    The industry faces intense competition, particularly in urban markets, where numerous contractors vie for contracts, leading to competitive bidding and pricing pressures.

Entry Barriers

  • Capital Requirements: Entering the market requires significant capital investment in equipment, labor, and insurance, which can be a barrier for new entrants without sufficient financial backing.
  • Regulatory Compliance: New contractors must navigate complex regulatory frameworks, which can be challenging and time-consuming, deterring some potential entrants.
  • Established Relationships: Existing contractors often have established relationships with clients and suppliers, making it difficult for new entrants to compete effectively.

Business Models

  • Design-Bid-Build: This traditional model involves separate contracts for design and construction, where contractors bid on projects after designs are completed, requiring strong competitive pricing.
  • Construction Management at Risk: In this model, contractors provide pre-construction services and assume the risk of project delivery, allowing for greater collaboration with clients during the design phase.

Operating Environment

  • Regulatory

    Level: High
    Contractors must comply with various local, state, and federal regulations, including building codes, safety standards, and environmental regulations, which shape operational practices.
  • Technology

    Level: Moderate
    The industry increasingly utilizes technology such as Building Information Modeling (BIM) and project management software to enhance efficiency and collaboration throughout the construction process.
  • Capital

    Level: High
    Capital requirements are significant, as contractors must invest in equipment, skilled labor, and insurance, with ongoing costs for maintenance and compliance.

NAICS Code 236220-20 - General Contractors-Nonresidential Buildings

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