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Focus on Making Money Daily

Let me ask you this, when’s the last time you considered your own focus?

Do you make decisions throughout the day with your profitability in mind? Is it your focus, and do you put in the effort to achieve it? To make money every day, you have to come to work each morning with a focus on doing what it takes to achieve this goal. You have to focus on sales, and to do that, you must master these three areas.

Know What You Need

The first is that you must know the numbers you need to generate each day to meet your goals of revenue and profitability. How many calls do you need? That should be a number you share with your team each morning and track throughout the day. If it looks as though you’re falling behind on this goal, then hit the phones and call your customers with a special offer or schedule your yearly maintenance agreement visits. If you don’t know what you need every day to meet your goals, you won’t be able to focus on achieving it.

Boost What You Have

You must also strive to maximize what you do have. This means that you must train your technicians to make the most of each service visit they run in a day. That doesn’t mean taking advantage of your clients because that is never the goal. Boosting your revenue comes from, first, maximizing the number of calls you book from the calls that come in.

Your call-taker should have a highly effective script for booking calls and you should train them frequently on this script. Here’s a tip. Mystery-shop your call-takers and record them. Then, use these recordings in your training sessions. If your average invoice is $263.00, and they miss one potential service call a day, you’re losing $68,380 in lost revenue each year, so training is crucial.

Secondly, your technicians must do what is in the client’s best interest. By doing this, you’ll maximize the amount of revenue available on each call. Perhaps it is in the client’s best interest to replace their system, roof, panel, or water heater instead of going forward with an expensive repair that may break down again in the future. Not only is this scenario in their best interest because their comfort will be protected, but it is in yours because you’ll reap the financial rewards.

Boosting what you have comes from training and focusing on the details. Train your call-takers to turn as many incoming calls into booked calls as possible. Train your technicians to offer options to your clients that are in the customer’s best interest. Training your employees in these areas and focusing on them every day will boost your sales and the money you make every day.

Track What You’ve Got

If your focus is on sales and meeting your goals every day, then this step should be a no-brainer. You have to track your results to see if you are meeting your goals. Doing so will show you where you have to improve and what you must do differently to meet your goals. You’ll see where your team needs more training and you may even end up changing your goals.           

Focusing on sales every day takes a top-down commitment. As the owner, that commitment must start with you, and you must pass it on to your team. Get your team excited about hitting their goals. Show them why revenue and profit are important to the future of your company and to their future success.

Getting your team involved in this daily sales focus will help refocus your team on the most important goal – service success.

 

Whistle While You Work

Have you ever been in an uncomfortable situation on the job? You thought you were alone, but when you turned around, there was someone right there behind you. You might have been talking to yourself through a job, without controlling your language, thinking that you are not being watched, only to suddenly hear your customer suddenly appear. No matter what the situation was, it probably put you in a really uncomfortable position.

First and foremost, you do not want your customer to think that you cannot be left alone. In other words, you want your customer to understand that the way that you appear around him/her is no different from the way that you normally are. Know that you are being watched at all times. This is true even though it may sometimes seem as if it is not the case.

Make an effort to control your language anywhere around your customers’ homes, turn down the car stereo in your company vehicle, and shine with confidence at all times. Your customer will not believe that you are capable of completing the job if you don’t believe it.

The initial shock that your customers get when they see you act differently when they are not around is enough to have them not use your services a second or third time. Your customer is nervous about having you invade their privacy to begin with; you want to make them feel as comfortable with you as possible. You want to enhance your customer’s home without causing too much trouble. This means not making any mess or causing an unnecessary scene.

What can you do to enhance your frame of mind? Build your personality into your work. Remember that everything reflects on your work, including your mood. Your customer is probably going to tell if you are happy or sad, lazy or efficient, and tired or awake.

By improving your personality and mood, you improve your work. This may be as simple as going to bed an hour earlier instead of watching television. You are guaranteed to be more awake and aware, and in return, able to do your job productively.

Uplift your spirit by whistling or humming a favorite song, like “Whistle while you work,” to give yourself a little boost during your day. Not only will your day go by a little smoother, you will be more enthusiastic and as a result accomplish more.

Insurance Rates Rising Each Year for Contractors

Are your insurance rates skyrocketing each year and you are wondering what you can do to get them down?  We are hearing from contractors across the country who are facing insurance sticker shock as they open up their latest statements.  Since you need insurance to run a proper business, especially in the home services trades, what can you do?  Here are a few quick suggestions:

  • Do Some Shopping – The easiest think you can do is to get on the phone and start calling around.  Get some competitive quotes from other insurers for the policy you need to protect your company.  If you find one that saves you money for the same level of coverage, don’t be afraid to make the switch.
  • Boost Your Share – The deductible is essentially the portion of the risk that you’re willing to take off the backs of the insurance company.  When you agree to take on more of the risk, they reward you with lower rates, so see if raising your deductible is a strategy that makes sense in your company.
  • Classify Correctly – The rates for a contracting company will be determined by the classifications the insurer puts you in based on the types of work that you do.  Talk to your insurance company and make sure they have you classified in the proper section.  For example, if you used to do a lot of work that required ladders and heights but you no longer do that work, you’re likely still classified there and paying more that you need to.  Make sure you’re insured for the type of work that you actually perform currently.

Finding a lower rate for your insurance is possible, but it will likely require some leg work on your part.  However, every dollar that you save in insurance costs is another dollar that will wind up on your bottom line, so finding the best deal on the proper coverage is a valuable exercise for every business owner.

Stop Bailing & Start Fixing!

“I’m too busy to get anything done!” It’s a line that I hear too often from members. It’s also a thought process that can cripple a company. That one simple sentence indicates to me that you’re likely spending too much time bailing water out of a sinking ship, rather figuring out how to stop the leak.

I know there are times when you’re spending as much as 70 or 80 hours as week in your office. You start the day with a plan. You have a to-do list filled with important tasks that need to get accomplished. Yet even at the end of a long workweek, you rarely get anything checked off that list! Why is that?

Too often the items on your to-do list get pushed to the side so that you can “put out fires” throughout each day. Instead of getting things accomplished that need to be done, you’re beating yourself up to handle constant problems. Instead of fixing your company (fixing the leak), you’re trying to keep things running (you’re bailing water on a sinking ship). So, how do you reverse that trend and start fixing, rather than bailing? Here are a few critical steps:

Start Training

Most of the time when business owners are forced to deal with constant issues it’s due to the fact that their people are not trained. The phone isn’t getting answered properly, and technicians aren’t communicating well with homeowners.  Stop the problems from happening in the first place!  That means mandatory training for CCRs and technicians at least once a week – I suggest twice a week. Make role-playing a constant, and get your people to understand what’s expected of them, rather than you assuming they know.

Empower Your People

Once you’re confident your people know their jobs, get out of their way.  Don’t become a crutch. There is no reason why you should be on the phone with every single technician on every single call. You’re not a baby-sitter – you’re the boss.  If your tech makes a mistake, so be it.  There’s no reason to beat him up over it – mistakes happen.  Instead, turn it into a learning exercise at you next training meeting.

Watch Your Numbers

The common denominator in profitable companies is that the owners are looking at their numbers. Your numbers will tell you if your team members are struggling and you need to address a particular issue in training. In other words, your numbers are like the gauges of a ship. Based upon what they tell you, you will know how to best steer your company.

Running a contracting business doesn’t have to feel like you’re aboard a sinking ship with no land in sight. Stop bailing water and start looking for a way to patch that hole. That means giving your people the proper training, supporting them in their decisions, and watching your numbers. You’ll be steering away from danger and toward profitability in no time!

What Should a Contractor Do in a Slow Economy?

If you’ve ever read anything about economics, you’ll find that things have a way of fluctuating back and forth. I suspect that our country and economy will bounce back in full force. However, it may take a bit longer than anyone would prefer.   In the meantime, the economy is the last thing you should use as a reason for struggling in business. It may make things more challenging, but it’s necessary that you have a positive attitude throughout this temporary downswing. It’s time you quit thinking about all of the problems circulating around the country and focus on one thing: Your business and taking it back to the basics! Like the old saying goes, “When life gives you lemons, make lemonade.” Well, when the economy gives you a recession, make the most of it.   ·       Look for technicians and salespeople you could add to your team. For the first time in a long time, there are actually good, qualified candidates looking for work.  More than likely, these people will be hungry to prove themselves, so they are able to keep their job.   ·       Realize that training is more important than ever. Your people need to know how to do their job properly and professionally. Every time your technician or salesperson walks into a home, they need to give the homeowner options and persuade them to do business with you. People’s sales skills can only be enhanced if you help and train them during weekly training meetings.   ·       Take advantage of Free of Very Inexpensive Marketing during the slow periods. Set up an email marketing campaign for your existing clients – sending them weekly tips and offers, have your techs drop flyers in the neighborhood they are working in, host an open house for your existing clients, set up a YouTube account and post videos of jobs you’ve completed. All of these marketing ideas are either free or very inexpensive but could have a major impact on your business during slow periods.   Believe it or not, not everyone is struggling now. We talk to contractors every day who continue to grow their business. It may not be growing as quickly as they would have liked, but they’re taking steps forward. Continue to stay positive that your company can manage through these slower times. I’m confident that if you take the focus off of what’s going wrong, and place your focus on implementing the basics, you’ll survive. Eventually, your business will be in a position to grow once the economic storm has lifted.

What Will You Do Today That Will Matter Tomorrow?

 

One of my favorite quotes is “What will you do today that will matter tomorrow?” I don’t remember where I first heard it, so I searched it online so I could give credit to the author — quotes are always more powerful when they are credited to a respected icon of wisdom—but all I found were some school websites that use that quote as their mantra. The reason I like this saying is that it reminds me to keep focused on improving myself and my situation every day. I know that the life situation I started with is not the one I need to end with. It is this simple belief that I attribute to my success.

If you do the same thing over and over and expect different results, you are thought to be insane. Yet this is what I see time and time again. I talk to business owners who want to make a positive change in their business but are not willing to make the changes necessary to do it. Maybe you have wanted to start a new process, install new software, or offer your clients a new product but did not want to take the time to become an authority on it. What you end up with is an outlay of cash or increase in debt, and a small buzz of excitement and a halfway implemented project that doesn’t work.

Learning something new is hard—at least until you have learned it. It’s hard because it requires change and we humans resist change.

Make change a part of your life. Do what is uncomfortable. It’s okay to feel awkward because that is a part of growth.  I always tell people, “if you are not failing, you are not learning.” Snow skiing is a great example. Success is not making it down the slope in total control; it’s about pushing yourself to the edge of being out of control and learning your limitations. If you don’t fall a few times, will you never actually learn your limits?

The biggest fear of change in most business is the fault of the human heart. It is your people that need to be changed and most of you don’t have the heart to do it. We either need to push them to grow or find other employment. You can’t grow your business with people unwilling to grow with you. Our people need to be pushed to their limits so they can grow. I am not suggesting that you become a tyrant; I am suggesting that you get them to test their limits by challenging them to do things they are uncomfortable with. Stars will rise and loafers will become resisters. Get the resisters out.

The biggest change you can make is changing your recruiting process. Don’t hire the best of the bunch; keep searching until you find the perfect fit.

Do what’s uncomfortable and learn to be a master recruiter. Always be working on your leadership skills. Read a quick chapter of one of John Maxwell’s books each morning and try to apply what you read each day. You don’t have to learn it all right away, just be sure you learn something every day because it is what you do today that will impact tomorrow.

Small Business Getting a Handle on Financial Statements

 

We recently received a question from a contractor.  Here is the question and what our suggestion was for him:

Q:  I’m a small business (just me and another tech) and I don’t have anyone in the office to keep my books.  I know I should have a better handle on how my business is doing financially, but I can’t afford to hire someone.  Right now, I gauge my business success on how much money I have in the bank.  Any ideas?

A:  You are not alone.  Many contractors have the same problem that you do.  Your financial statements are a very important tool that allows you to see the following:

  • How much revenue you are bringing in;
  • Where you spend your money;
  • How much profit you make;
  • Who owes you money;
  • How much you owe suppliers;
  • How much cash you have;
  • The amount of debt you have (loans, notes, etc)

Financial statements can identify challenges that you have in your business as well as assist you with knowing when and how to grow your business.  It is one tool that you cannot afford to go without.

So here is my suggestion:  Go to your Yellow Pages, or online, and look under bookkeeping service.  Find someone who you can outsource your bookkeeping to.  Most small businesses use QuickBooks-certified.  Make sure and ask for references and let the company know that you need to get timely information.  It will need to be able to do the following: record customer invoices and deposits made into your bank account, enter and reconcile accounts payable, reconcile your bank statement each month, and assist you with quarterly tax payments.  If they will also take care of your payroll, I highly encourage you to let them process payroll for you as well.  If they do not process payroll, look for a service such as ADP or Paychex to do it for you.  Payroll is one of the most error-prone accounting processes for small businesses.  And it can cost you thousands in penalties if you don’t process it right!

Making Easy Money at Your Desk

 

It’s a slow day in your company.  Everyone is dragging as that empty callboard stares you in the face.  It’s getting close to quitting time, and everyone is just ready to put this sales-killing day behind you.

Suddenly, your best technician walks through the door.  He has a hint of a smile on his face like he knows something you don’t.  He walks right over to your desk and puts a piece of paper down on the desk.

You pick it up slowly, expecting a resignation letter after such a slow day, when you realize it’s an invoice.  And not just any invoice.  It’s a $10,000 day-saving invoice!

Your technician just made a $10,000 sale!  You jump out of your chair and give the man a huge bear hug.  Everyone cheers!  The day is saved by the $10,000 sale!

And, it is great, but just how great is it really?

If you’re like the average contractor, you’re operating at a 3 to 4 percent profit margin.  In that case, that $10,000 monster sale netted you a whopping $300 to $400.  Not so exciting now, is it?

But here is what’s exciting.  You can gain that $300 – the profit equivalent of a $10,000 sale – and more just by making some simple tweaks from the comfort of your desk.  These profit-minded tweaks don’t require you to step foot in a truck, put in any extra hours, or even take on an additional headache.

These are stress-free dollars that drop right to the bottom line.  To get them, you just have to start buying right, and here are four simple ways to change your buying behavior so that you’re earning $300 to $400 in savings without lifting a finger:

  1. Grab the discount – The easiest way to grab those savings is to pay your bills in time to grab any early pay discounts your suppliers might offer you.  If you have this option, take it!  Even if it requires some extra cash flow management, it’s worth it.
  2. Work with low levels – The second strategy is to keep your stock and inventory at a low level.  This saves you the expense of the space needed to house that inventory, lessens the chance that those parts become obsolete, and limits your exposure to shrinkage.  Bottom line – it saves you money.
  3. Pass the hassle, keep the savings – The best option is to have someone else manage your inventory altogether.  If you can work with your supplier or manufacturer, you may be able to get involved in a virtual inventory management program where they manage your inventory and you only pay for parts as you use them.
  4. Buy smarter with a little help from your friends – This one is huge.  The biggest impact you can have on your bottom line is by buying smarter at the lowest prices possible.  Even if you’re a $1 million company, you can buy lower.  Chances are there is a $5 million guy buying at even lower prices.  And even if you’re a $20, $30, or $40 million dollar operation, there are $400 and $500 million dollar companies getting deals you wouldn’t believe.  It all comes down to the power of numbers.

The only way for the independent contractor to get the same power of numbers is to band together.  AirTime®500 can help you do just that.

When you can consistently save $300, $400 or more by buying right in your business,  you’ll feel like you are tripping over the $10,000 sales every day because those savings will drop right to your bottom line every time you make a smart buying move.

Start buying smart and start earning the extra profits you deserve.

Increasing your Average Invoice

 

We recently received a question from a contractor.  Here is the question and what our suggestion was for him:

Q:  My average invoice is too low.  How do I increase my company’s average invoice without my technicians thinking I’m just trying to turn them into salespeople that are just trying to take advantage of the customer?

A:  When one of your biggest expenses is the marketing you sent out in order to get calls, it’s so important to make the most of each of those calls.  That means your technicians need to be aware of their average invoice goals and you need to help them achieve that number.  Here are four quick steps for helping your technicians achieve a higher average invoice:

Step One:  Set Expectations – People have a tendency to do what is expected, so set expectations at the level you need for your budget and plan, and then communicate those expectations.

Step Two:  Track performance – What gets measured gets improved, so track your team’s performance every day.

Step Three:  Review and coach – Review each technician’s average invoice performance individually and provide positive feedback and methods for how they can improve that amount.

Step Four:  Review invoices – Review each technician’s invoices to see what they are recommending that homeowners aren’t accepting.  Then, coach the technician on how they can gain the customer’s approval on more of these repair recommendations.  If your technicians know that every invoice is going to be reviewed, you’re sure to see an immediate increase!

Step Five:  Celebrate your success – People love praise.  As your average invoice starts increasing remember to take the time to celebrate and recognize your technician’s success.

Good luck!

Watch Out for the Wolf in Sheep’s Clothing

 

I once heard that the two most important ingredients to a successful business are urgency and accountability. I agree.  In fact, if your business lacks urgency, it probably makes up for it in desperation.

Before you dismiss this topic as something that does not pertain to you, you should first make sure your company’s urgency is not desperation in disguise.

  • If your business is always in panic mode trying to fill the schedule to cover payroll, you’re not being urgent; you are being desperate. You should be urgent to market for more clients or train your people to serve them better, or cut cost to stay profitable no matter what size you are.
  •  If your call-takers are rushing through the calls to answer the next ringing line, you are not being urgent to gain business; you are being desperate to stop the ringing phone. Your urgency should be to find out why the call-takers are not able to spend the time needed to correctly use their scripts.
  • If your techs and/or salespeople are running as many calls as dispatch can squeeze in each day, you are being desperate to get the calls done.  The focus is on pacifying clients, not serving them. Your urgency should be to find a way to allow your field people the time necessary to serve your clients.
  • If dispatch is grabbing whatever calls they can to fill the schedule, they are not being urgent about profits; they are desperate to make the schedule look full. This is a sure way to run up labor costs. The urgency should be to run a profitable schedule by marketing for more clients or giving a tech or two a day off.
  • You have installers cleaning the shop when there is no work that day. Keeping people busy when there is no work is desperation to get caught up and keep your people happy. This runs up labor costs. I promise they will take their time cleaning when they have it. If you have urgency to keep the shop and yard clean at all times, they will move much quicker after a day on a job as they will want to get home.

A company with true urgency bred into its culture will have a different attitude about things.

  • When you are so excited about a decision to make change in your business that you begin implementing it right away, you have urgency.
  • When you are faced with a customer complaint and your team moves fast and is eager to resolve it, you have urgency.
  • When the phone rings and you rush out to serve the client—even when you are ahead of budget, and you have fun doing it—you have urgency.
  • When you move the repair call on the five-year old system a couple of days out and waive their diagnostic fee for the inconvenience so you can fit the repair call on the 18-year-old system without over working your techs, you have urgency.

To have urgency, you must have an “urge” to do something.  The urge of most people is to sweep problems under the rug as soon as possible and go home as early as they can. These people are easy to spot. They are the same ones who complain about the same things over and over.

So how do you create a company with urgency? The easiest way to do so is to make sure your company has that other thing I mentioned earlier… accountability. You can use accountability to create that urge needed in your people. But before you do that, you need to set an expectation. Set high expectations, and hold your people accountable to them. This will give them urgency to achieve. If it doesn’t, you have the wrong people. Lack of urgency and accountability will stifle sales and lead to the entitlement mentality in the workplace. In other words, it’s a knife to the wrist of your business.

If you have disguised urgency in your business, you should address it now. The best time to start something is the time you decide to do it. Don’t wait. I’m not saying you should not take a moment and plan it out a bit; you should. But don’t halt progress looking for reasons something can’t be done. Look for reason it can.

Sometimes you are too deep in your business to see it objectively. This is a good reason to have an outsider and help you see your business as you should. Coming to a Success Day can do just that. Call 1-866-362-3455 to join us at a Success Day and let us help you.