There's no denying that it's still pretty slow out there. If there's a silver lining, it's that you now have time to run your business instead of running alongside it, struggling to keep pace. Still, the sputtering economy creates pressure to cut prices, but this is not the time to discount your services. There's a difference.
When prosperity is effortless, as it was for many remodelers in the past five years, it's easy to lose your edge. Everyone gets a little sloppy when work is plentiful -- all the more reason to examine every one of your processes to tighten up the slack and squeeze out more efficiency. Here are some places to start:
Marketing. In boom times, we gravitate toward the biggest jobs. In lean times, we need to remember that it's the best jobs, not the biggest, that make the most money. If a windfall economy pulled you away from your expertise, now is the time to get back both to the type of work you do best and to the type of customer who most needs your services.
Estimating. When customers are waiting in line, there isn't much incentive to be competitive. In fact, it's a common strategy to raise prices until somebody squeals. That sound you hear from your prospects is telling you it's time to get back to normal pricing. That doesn't mean cutting margin -- the savings have to come from the expense side.
Productivity. Work expands to fill the available time. I can guarantee that your field crews have lost a half-step. Either they've learned to cut corners because of schedule demands or they've gotten careless about efficient work habits.
Selling. Tighter estimating and more efficient productivity will allow you to sell at a more competitive price while maintaining margins. During boom times, however, selling tends to deteriorate into order taking. To win jobs in a tighter market, you'll once again need to highlight benefits, compare price and value, and counter objections.
Sal Alfano, Editor-in-Chief [email protected]
