The first thing, and perhaps the most important one, a construction company must do to survive is to understand the people they are working for. According to Charles Nielson, President of Nielson, Hoover & Company, the same principle applies to private and public roles.
Although surety bonds seem to be an overwhelming topic for most businesses—especially for the new ones in the process—it is a must for every construction business owner to understand this type of agreement between three different parties involved: an obligee, a principal, and a surety. The key roles each party plays are explained in detail in the podcast.
Charles said that if you sign a contract to build a building in today’s market, you have to think about the issue of rising costs in some way. However, one should note that surety bonds are not insurance. Instead, they are assurance.
“As a contractor in this marketplace, you must be able to facilitate the challenges that will come to you when you look at challenging problems that are in place now and that are just over the horizon.” – Charles Nielson
What You’ll Learn from this Episode:
· The importance of surety bonds in the construction business
· Key roles by distinct parties: an oblige, a principal, and a surety
· How to avoid financial walls and potential bankruptcies in the construction industry
· How to assess and figure out the risks of the potential loss
Connect with Charles Nielson on LinkedIn
Contact Lunacon Construction Group on LinkedIn