As business owners, we need to keep an eye on what’s going on with the economy because it should influence our business decisions.
Business Saving Tips
Overhead creep is one of those subtle things that business owners often don’t notice. It leads to cash flow problems real quick.
When business relationships are in writing, there are fewer problems. A customized employee manual and subcontractor manual is important.
I often hear from someone lamenting about an employee. They got in a hurry to hire and now they are paying for it.
To become successful and build your business, you want to be known as the expert at the type of job that provides the highest profit margins.
Too many sales people fail to give options, then wonder why they hear “your price is too high” or “we want to think about it” to keep from making a decision.
I’ve talked about the need for a contract, and the importance of a clear payment schedule, because without a well-written, clear contract, you’re headed for trouble.
A good payment schedule keeps you paid for the work you are doing. If you're using a 1/3, 1/3 and 1/3 schedule, you are financing most of the job out of your pocket.
Contracts and change work orders are among the top reasons construction-related businesses fail. Or rather, not using contracts or change work orders.
Is the customer always right? Hardly. But clients should never feel they’re being taken advantage of or they’re wrong on some issue.
All too often in construction sales, the focus is on selling a job. Let's rethink that; sell the design agreement so you can do the work needed before the job starts.
There are lots of opinions on how to pay a salesperson. Your salespeople have to be able to make a good living and provide for their family.
The top two complaints about contractors are that they don't return their phone calls and they show up late (if at all) for appointments.
If the next person you see wants to spend a few hundred thousand on a remodel, would they trust you to do the job? Like it or not, it will depend on first impressions.
If you want a successful, profitable business, you need to spend a majority of your time on profitable sales. That’s easy to forget.
Why would any serious construction-related business owner want to be the lowest bidder on a project? Let’s look at what that means.
Over the years, I’ve learned that too many contractors determine their job price by borrowing someone else’s numbers. That can be an expensive mistake.
When we talk about making money, it's rarely about big chunks of change. One overlooked item that costs money is rounding numbers. For instance, your markup.
In our book we talk about the ratio of employees to dollar volume of business. Many contractors ignore this ratio and get caught up in the urgency of building a job.
Contractors have cash flow problems for two major reasons: poor money management, and poor payment schedules.