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Q.I'm a general contractor in a small town where there are many licensed contractors, which makes competition fierce. Some local contractors seem to think the way to do business is to give their materials away at cost and to charge $25 per hour for labor, thus creating a bare-bones time-and-materials environment. Do you have any suggestions that will help us compete and still make a decent profit?

A.Les Deal, a remodeler in Cedar Rapids, Iowa, responds: You've identified your problem: The word that's killing you is "competition." I work from the premise that competition is not relevant.

The reality is, if you want to be a contractor, you must make a profit. Therefore, the first part of the answer is simple: Raise your prices to create a decent company profit. So now you say, "Thanks a lot -- how do I get work?" I'll offer another simple answer: Make an active decision to specialize in the work you love, based on the skills you love to use. If you don't emphasize enjoyment of your work as the top priority, you won't have the drive to continually learn and better yourself.

The result of doing what you love is that you will become more creative, more efficient, and a better contractor. You will be driven by sheer pleasure to hone your skills and will automatically feed on your own love for your work.

Isn't that exactly who many customers are looking for? These developed skills will make your higher prices seem like a bargain to the customer. Plus, a contractor working in his niche exudes excitement and confidence, which will help you win jobs.

My own niche has been challenging remodeling jobs, jobs that look like a quagmire of problems and that call for unique, cost-effective solutions. Thirty years of that mindset has created a path of great diversity in the kinds of work that come my way, and I still love it.

It doesn't matter what part of contracting you enjoy. Decide what it is and focus on that kind of work. Think back to the projects you really enjoyed, and try to figure out why. That should lead you in the right direction.