The Contractor's Chicken-and-Egg Problem: Crew Size vs. Work Pipeline

Ask a contractor what keeps them up at night and you'll hear some version of this:

"Do I have enough work to keep my crew busy? Do I have enough crew to handle the work that's coming?"

Ben Wespi runs a mechanical insulation company in North Carolina. When I asked him about his most stressful recurring decision, he didn't hesitate.

"The whole trick—I'm a year into this, but what I'm seeing—is you're constantly trying to balance a crew size with your work pipeline. You always need enough work ahead of you to make sure you can keep your crew employed. But you don't want to have too big of a crew and start paying people for work that doesn't need to get done."

It's a chicken-and-egg problem with real financial consequences.

This one hits close to home for me. My dad ran a renovation business when I was a kid. He lost it in 2003—lost our house, lost our car—because he didn't have visibility into his numbers until it was too late. I don't know exactly what the tipping point was, but I'd bet money it was some version of this same problem: crew costs that didn't match the work coming in.

The Case for Staying Lean

Ben's philosophy is simple: it's better to be slightly understaffed than overstaffed.

"What you find is, hey, it's always good to be just slightly lean on your crew size and keep those projects going. If you need to, you bump into overtime. You pay those guys a bit more and they can keep you caught up on projects."

The math works in your favor. When you're lean and work picks up, you have options:

Pay overtime (expensive, but temporary)
Say no to new work (painful, but manageable)
Bring in outside labor (costly, but controlled)

When you're overstaffed and work slows down, your options are worse:

Pay people to do nothing (cash drain)
Lay people off (destroys morale, loses talent)
Hope something comes through (not a strategy)

Being slightly lean gives you flexibility. Being overstaffed just costs you money.

Every contractor I've talked to in my research eventually learns this lesson. The ones who learned it early are still in business. The ones who learned it late often aren't.

Overtime as a Tool, Not a Failure

A lot of contractors treat overtime like a failure of planning. Ben sees it differently.

"Honestly, for overtime—if we can afford it and it doesn't crush our margin too much—I'm happy to give these guys the opportunity to work overtime. Most of them, that's a lot of extra money in their pocket if they work an extra 8 to 16 hours on any given week."

It's a win-win. Workers get extra income. The company gets caught up on projects. And nobody got hired who'll need to be let go in two months when things slow down.

"I like being able to give that opportunity back because it's kind of a win-win. They make extra money and I get a little more done on this project in that given week."

The key phrase is "if we can afford it." Overtime isn't free. But it's cheaper than the alternatives.

The Real Problem: Your Customers Are Playing the Same Game

Here's what makes this truly difficult: your customers are managing the same problem.

"The struggle when you're trying to grow is assessing where your customers are on those projects and when they're going to need you. Because the customer is doing the same thing. They're like, 'Hey, look, I got to be lean too. I'm going to bump right up to the end of my deadline and then I'm gonna hand this off to you.'"

So you have multiple customers, all trying to stay lean, all pushing their deadlines, and all expecting you to be ready the moment they need you.

And those crunch times overlap.

"The challenge I'm constantly dealing with that's the most stressful is trying to help support a customer that urgently needs me while not dropping my support to other customers that I need to maintain."

When Ben described this, I started thinking about it like a signals intelligence problem. You have multiple data streams—project statuses, customer timelines, crew availability—and you're trying to predict where the conflicts will happen before they blow up.

With just four to eight projects, you can kind of hold it in your head. But what happens when you grow?

Where the Real Money Leaks Happen

When the system breaks down, money disappears fast.

The worst-case scenario isn't paying overtime. It's having a customer say: "You're not getting it done. I'm bringing in outside labor and I'm billing you for it."

That's where margins get crushed. You're not just paying more—you're paying for someone else's solution to your problem, and you have no control over the cost.

"Those are the things we want to try to avoid. That's where the big money leaks come from."

This is the stuff that kills businesses. Not slowly, not obviously—just a few bad months where costs outpace revenue, and suddenly you're underwater. By the time you see it in your bank account, it's too late to fix.

Solving It With Better Data

Ben is working on this problem from the project management side. The goal: know where every project stands and predict when crunch times will overlap.

"I'm looking at project management solutions that help me track my current project status and how much time I'm going to need on a project based on what we estimated. I'm trying to track that automatically and not rely on the expertise and wisdom of a foreman on-site."

The vision is being able to tell customers: "I'm tracking that you're at this percentage completion. If you finished your project at this pace, I would need X number of weeks. Your deadline is Y. So if you keep pushing me up to your deadline, we're going to have a problem."

That's not confrontational. That's professional. And it gives customers the information they need to plan better too.

I love this because it turns a reactive problem into a proactive conversation. Instead of scrambling when everything hits at once, you're managing expectations weeks in advance.

The Uncomfortable Truth

There's no magic formula that eliminates this stress. Ben admits he's solving this problem "poorly" right now—because everyone is.

The contractors who manage it best are the ones who:

Stay slightly lean and use overtime strategically
Track project status obsessively
Communicate proactively with customers about timeline conflicts
Build enough margin into bids to absorb some crunch time
Have relationships with outside labor they can call when needed

It's not about eliminating the chicken-and-egg problem. It's about being better at managing it than your competitors.

And about having the visibility to see problems before they become emergencies.