Scenario: Your accountant just told you that you lost money during the last quarter.
Buck up and say thank you to the accountant. You can't recapture the money, so moping around won't do any good. Have the accountant tell you where you lost the money...was it selling too low, was labor too high, was your overhead climbing too fast? A good accountant will be able to see this easily. Then, sit down that evening and look at why the problem area occurred and make a list of ten or more possible solutions to the problem. Now, go to sleep. In the morning, look back at your list with a fresh focus, and you will see that three or four ideas are just plain silly, one or two will cost more than they save, and one or two may just work. That's your target.
If you don't have any ideas, reach out to your second in command at the shop, sharing the problem and asking for solutions. Ask your accountant, your lawyer or any business advisor you have. Maybe another glass shop across town will be glad to talk with you.
Write a program that fixes your problem, based on the two ideas that you kept. Sleep on it again, and if it still looks good, then you start to implement.
Great words, Paul, but what are the possible fixes if you lost money last quarter? Most of the people I have been talking with have their payroll as low as it can go. People have time to shop around, so you are probably buying at good prices. The most common thing I hear is that selling prices are so low that no one is making any money. How then, can you raise prices when the market is soft?
Bid on work that can go to any bidder, not jobs that are required by law to go to the lowest bidder. This may cause a change in your business plan, and that is OK, the economy has changed, and you can change with it.
Give your potential customer, Sam Geecee, greater value. When you give a bid, list all of the extra points your company will include:
- Washing every window you install;
- Do the work on the evenings in an office building so they won't be displaced from their normal work effort;
- Eat any small extras, up to a preset value, telling Sam that you are a service company;
- Stress all of the warranties you are passing through from your vendors, give a warranty of a year or two on all of your work;
- Stress the high quality of the materials you use for sealants, piggyback on the good will of the name brands, avoiding the bargain stuff;
- Explain how your glass and metal is energy efficient, assist Sam with understanding LEED points, show how much Sam will save in energy costs;
- Build a small mock-up, when Sam didn't ask for one, to make sure everyone is on the same page;
- Always look clean and neat in every contact with your potential customer, sure you have work clothes on but your shirt is tucked in, your hair neat, and your paperwork doesn't have coffee stains;
- Take them on a tour of your glass fabricator's plant, if nearby, showing the quality of the product you will be installing;
- Promise Sam his punch list will be done promptly, and then do it promptly--this is what you will be remembered by;
- Offer to take Sam around to other similar installations you have done to verify your skills;
- Promise that your employees will always look presentable on the customer's job site
OK, here are a few great ideas, and a few that are a real stretch---that is exactly the point. Some you throw out, some you implement.
This can help raise your selling prices by maybe a point or two, so, let's try it.
2 comments:
Hi Paul,
the Leed info, whether asked for or not goes a long way, even offering a few alternatives to save longterm $ works too.
A small mock up , where possible , brings results way beyond expectations and the neatness thing should certainly not be overlooked.
all good suggestions though. And...while you are installing the job(s), it does no harm to show a happy customer a few of the other ways your company can serve him.
Jim Fairley
Some great information. I always enjoy your comments.
How about this easy and quick start to turning things around: Each day we have people take the time to drive to our business. They park their car out front, they walk through the entrance door, and then they ask us for something we don't normally do or maybe even something we've never done. We honor their efforts with this phrase, "no, we don't do that." This makes life much easier for our counter person, but for the person that walked into our business we have sent him on in search of his needs.
It is my contention that anybody that makes an effort to come to my place of business, is quickly elevated to "best customer" status. It is incumbent upon me as a business man to do everything I can to meet his needs.
Recently we began keeping a "no List." This is a list of items that we tell customers we don't have or services we can't perform.
We review this list every month and then discuss the viability of adding product and/or service to our offerings.
I'll give you an example. We always told people that we do not sell colored acrylics. We would then direct them to a plastic distributor, sometimes drawing them a map of how to get to the location. We have since found a distributor that furnished us with color samples and will deliver to us free of charge. Last month we sold $1,100.00 worth of red acrylic to a customer.
It's funny, we all need more business but believe me you would be surprised at what you are turning away. From your "best customer" of all people.
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