Construction Companies Are One of the Businesses in the Sector

Economics related to a planning or implementation and supervision of a https://quadramerida.com/ construction activity to form a building or other physical form in the implementation of the use and utilization of said building concerns the interests and safety of the people who use the building. Construction work services are the whole or part of a series of planning or implementation activities along with supervision which includes architectural, civil, mechanical, electrical and environmental management work respectively and their accessories, to create a building or other physical form (Law no. 1999).

According to Ervianto (2002) the definition of a contractor company is
the person or business entity that accepts the work and carries out the work in accordance with the specified fee determined based on the drawing plans and regulations and conditions set.

Currently the competition in the world of construction is getting higher due to the rise of foreign contractors who took over implementation of national construction but not balanced with increase in Indonesian contractors abroad. Last data amount national contractors in Indonesia which reached 182,800 while foreign contractors in Indonesia amounted to 258 (General Chairman Gapensi, Soeharsojo, 2012). Sometimes small contractors often face large contractors, for example contractors from state-owned enterprises.

This is because the contractor classification does not distinguish segmentation in a project auction competition. In the classification of contractors according to the Government Goods/Services Procurement Policy Institute, there are 7 levels. Level one is an individual contractor and is not yet a legal entity, Levels 2-4 are in the category of small contractors who are only allowed to work on projects with a maximum value of Rp. 2.5 billion, while levels 5-7 are classified as non-small contractors who can work on projects with a value of more than Rp. 2.5 billion.

But sometimes level 5 contractors who are usually new
moving from a small contractor group to having to deal with level 7 in the class of a BUMN with a minimum annual turnover of Rp. 500 billion, in a construction auction and the result obtained is that level 7 contractors often win auctions.

In business competition, contractors should be faced
with other contractors of the same level. For example contractor level 5
with level 5 who are both new players in the group
small contractor. So that business competition becomes fair
with the level. In the midst of intense competition in the construction services business, construction service business players in Indonesia, in this case construction service contractors, are trying hard to maintain the viability of their companies.

The maintenance of the existence of a company among others depends on the company’s ability to see market opportunities that exist. Under these conditions, the company’s marketing sector plays a very important role in terms of seeing existing market opportunities.

This area of marketing has the most contact with company’s external environment. It doesn’t just work for viewing market opportunities, but overall the marketing field is functionedto beat the intense market competition. Unfortunately inside In many cases in the construction industry, contractors are still lacking
attention to this marketing function (Pearce, 1992). In his study, Pearce stated that contractors believed
that the most important part of an organization is the production department, so they are more production oriented than marketing. They see more opportunities that they feel are compatible with their abilities as a contractor, rather than adapting to current circumstances and future market opportunities. The establishment of ASEAN regional free trade after the 2015 ASEAN economic community which will begin in 2015 will greatly impact competition in the construction business in Indonesia in the future. This can be seen from the lack of readiness of national contractors to compete with foreign contractors who have capital assets, human resources and technology that exceed those of national contractors.