Category Archives: HardHat Presentations

Fill The Seats Or Go Broke!

If you were the owner of a NFL football team, your number one goal would be to fill all the seats every week. To fill seats takes a multiple approach. You must put a winning product on the field and you must sell seats. Seats don’t sell themselves. It takes a huge effort to create sellouts at profitable ticket prices.

Over the last ten years, you didn’t have to sell very hard to keep profitable revenue flowing into your company’s coffers. If you put a mediocre team on the field, called the usual plays, and used an average business strategy, your customers would keep coming back for more, if your price was somewhat competitive. And because business was plentiful, you didn’t have to try to win over many new customers. You stayed focused on doing the same type of work for the same type of customers and your business grew. Because there was enough work, you also didn’t have to try different types of projects, customers, or contract delivery methods. In fact, you even prided yourself as a specialist in a very focused type of business niche.

Fast forward. Today it is hard to fill the seats, revenue is scarce, and customers are hard to find. Having a winning team doesn’t matter if they can’t find a game to play in. You’ve cut your overhead and reduced your expenses as low as you can to survive. You continue to bid more and more work against too many competitors at lower and lower prices. Now you are even calling on new and potential customers you really never wanted to work for. You’re trying to get on any bid list you can including public works, which you always avoided because of the paperwork and prevailing wage issues. You’ve assigned your office manager or estimator to cold-calling and emailing any lead they can find in hopes of a miracle. Nothing is working and getting new business at a reasonable price is next to impossible.

Now what? You’re thinking you’ve got to fill the seats with paying customers or go broke. If the sudden slowdown in the economy taught everyone one thing: ‘Putting all your eggs in one basket won’t work forever.’ Many contractors and business owners focused their efforts on doing only one kind of project and service for one type of customer. For example, to keep revenue and jobs flowing in, many focused on only building housing tracts, or shopping centers, or industrial parks, or custom homes, or office building interiors. Some focused on building for general contractors, developers, or home builders. Some expanded and did more than one type of project. But, most didn’t crossover into totally different or diverse types of work. And offering a service component to their revenue stream wasn’t even considered as they were too busy to mess with little jobs.

Multiple streams of income sells more seats!
A diverse business plan includes three types of revenue streams with many different types of projects per stream. For example, here is a partial list of the unlimited revenue and business opportunities contractors have to choose from:

Multiple Revenue Streams & Opportunities          

1. Contracts & Bids

Private Construction
Retail shopping centers
National chain stores
Industrial buildings
Manufacturing & factories
Metal buildings
Office buildings
Banks
Medical buildings
Hospitals
Self storage
Renovations
Interior Improvements
Utility Company Projects
Housing Tracts
Custom homes
Residential remodeling
Residential home upgrades
Residential replacement work
Site improvements

Public Works Construction
Schools
Offices
Hospitals
Facilities
Roads & highways
Transportation projects
Sewer & water projects
Storm drain systems
Plants

2. Service Work & Ongoing Accounts

Ongoing Monthly Or Annual Accounts
Property management
HVAC maintenance
Electrical maintenance
Plumbing maintenance
Landscape maintenance
Site service & management
Spring & winterization
Light bulb replacement
Roof service
Road and drainage repair work
Generator service
Energy management & controls

Repairs & Service To Fix Broken Components
Plumbing & mechanical repairs & upgrades
Window replacement
Tenant improvements
Tenant relocation
Carpet and flooring service
Building damage repair
Clean-up and debris removal

3. Wealth Building & Passive Income

Own income producing real estate

Rental homes
Apartments
Shops and yards
Industrial buildings
Offices
Shopping Centers

Own income producing businesses
Rental equipment companies
Wholesale materials
Supplier
Services Continue reading

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5 ‘Must Do’ New Year Resolutions!

It is almost 1 month into 2012 and things are already moving too fast. Hopefully you took a few moments and wrote out your goals for the next 12 months. Written targets and goals will insure you get what you want by keeping you focused. Less than 20% of all business owners actually write out their goals. And guess what? These top 20% are in the top 20% of the most successful business owners in their marketplace. A simple way to start is to write out these 5 goals:

1. Don’t be an island! 
Get involved with a group of like-minded business owners to seek advice, share challenges, get invigorated, and get accountable with on a regular basis. Personally, I made a decision to join a structured weekly group of men who discuss their personal and professional lives facilitated by a top business/life coach in our area. Consider looking into joining one of our BIZ-GROUPS or a local group in your area. Bottom-line – do it!

2. Take time to plan your plays!

Bill gates said that the best thing he did while building Microsoft was to take his management team away on a regular basis to plan for the future. At these regular retreats they discussed their strategy, options, new opportunities, what’s working, what’s not, and what they need to do to achieve their goals. When you don’t plan your future, you get what the market gives you instead of paving your own path.

3. Innovate or die!
Your business won’t work doing what you did when the economy was growing. In a flat economy, you have to change your business and evolve into a new kind of profit making machine. What new customers, markets, systems, technology, people, production methods, contract type, services, and products should you add or delete from your business to grow fast. Sit down and rate every part of your business as: keep doing, stop doing, start doing, or change how we do it.

4. Revamp your calendar!
Your calendar says it all. If you want to save money, your calendar is full of job meetings, ordering materials, scheduling crews, and doing take-offs. If you are focused on making money, it’s full of time with loyal customers, new customer targets, networking, mingling with potential customers, and building relationships. At least 33% of your time needs to be with customers having fun and enjoying each other. Make it your goal to revamp your calendar and pro-actively grow your business.

5. Put yourself first!
When I coach business owners, we always look at the income statements to see how they are doing. I almost always notice that business owner pay themselves way too little for the time, risk, and work they perform. In addition, their investments are often slim or none. When you put other people, employees, and customers ahead of yourself, you can’t do the best you are capable of. Customers want to do business with successful people, not poor struggling people. Make a commitment to pay yourself what you are worth and start an investment program starting now. Then spend the rest on overhead and expenses.

The Business Do Over!

In sports, the coach gets to start over every season. Winning coaches look at their past records and make positive decisions of what they need to drastically change and achieve better results. If they continue to play the game the same as they did last several seasons, they won’t continue to build and win. They have to look at how they play the game, players, coaches, methods, offense and defense, training, strategy, and tactics.

Now imagine it’s your turn to start a new season. You are the coach of your business and want to keep your job and make a lot of money for the owners. What should you do differently to win the game of business? What tough decisions should you make? What new plays will you call? What players should you replace? Where should you play the game and how? Will you keep doing what you’ve always done or decide to do whatever it takes to grow your business and make a profit? Below is the list of the top “Do-Overs” I hear from the many business owners I have surveyed.

Do-Over # 1: Invest Sooner Than Later!
When your business was busy, you didn’t have enough time to stop and look for investments. And you were growing, so most all of your cash-flow went to fund your company’s growth. The snowball effect was keeping you excited as your business got bigger and bigger. It was like a shot of adrenaline as you did more and more work. The more you grew, the bigger you wanted to get. Volume is addictive, so you bid work too cheap and never missed an opportunity to grow or gain a customer. Everyone thought this gravy train would never end. Continue reading

If You Could Start Over, What Would You Do Different?

Think of all the decisions you made over the last five to ten years that affected your future and where you are today. Now think of all those decisions you didn’t make you wish you had. Remember when you were busy signing new contracts, getting plenty of business, trying to juggle all your commitments, scheduling crews, putting out fires, and doing everything you could to keep everyone happy? During this time it was hard to do everything you wanted to do. Continue reading

What Is Your Bidding Strategy?

After you have established reasons why customers should hire your company, now it’s time to find jobs to bid where you can be successful. Your overall estimating and bidding strategy is to get enough signed contracts at your price to cover your job costs, overhead, and then make a profit. This requires several winning plans. The first strategy is to have a strategy! Many contractors bid any job they are offered to bid. They don’t have a strategy that helps them decide which jobs to bid and when to say no. What’s your estimating and bidding strategy?

Before agreeing to bid a project, create a list of questions to determine if you will have an excellent chance to win the contract.

 1. Do you want to negotiate the project?
– How will you convince the customer to negotiate with you?

2. Do you want to be the select or only bidder?
– How will you implement this strategy?

3. Do you want to get the last look?
– How will you make this happen?

4. Do you know your bid-success ratio against your competitors?
– How do you keep track of your success versus competitors?

5. Do you have competitors you don’t want to compete against?
– How will you discover this information?

6. Do you have some competitors you will bid against?
– How will insure the bid list gives you a chance to be awarded a contract?

7. Do you have an ideal number of bidders you’ll bid against?
– How will you insure this happens?

8. Do you have a maximum number of bidders you’ll bid against?
 – How will you decide when not to bid a job? Continue reading

Low Bid Gets the Job In Public Work

In public works construction, the low bidder usually gets the job and there is little or no room for sales strategy or tactics. The best way to be the low bidder and awarded a contract is to have the lowest possible costs and the most efficient construction management and field operation possible. To keep your costs lower than your competitors, your field crews must be lean, productive, and well trained. There must be no downtime, job problems, quality issues, coordination conflicts, or mistakes. Your subcontractors and suppliers must also be supervised and managed tight without gaps in scheduling, productivity, conflicts, or quality. This can only be accomplished with diligent leadership, accountable management, and ongoing training focused on productivity and efficiency.

Now you are in the sales business!
In private work, it takes a lot more than just bidding and negotiating to win contracts. You’ve got to give customers a differentiating reason to hire your company. It’s not just about the price, inclusions, and exclusions. Now there are too many competitors who can do the same job as your company and will cut their bid below their cost to get a job. To win more contracts at your price, you must face reality. You are not in the construction business. You now have to also be in the $ALES business! Continue reading

Do your customers want more?

Joseph owns a residential landscape company doing new installations for homeowners. He mainly works on referrals from custom home-builders, architects, and past customers. Sometimes his company is busy and other times he waits for the phone to ring. By chance he was asked to do some hauling for one of his contractor customers. In the past he didn’t pursue this type of business because is was a nuisance and disrupted his operations. But this got him thinking about how he could expand his revenue sources.

Joseph decided to set up a new division that focuses on service work. He moved his chief estimator into the role of division manager to build the customer base, added a service manager, and put a bookkeeper in charge of managing the accounts. He started by asking his customers what other type of services they needed on an ongoing basis. His homeowner customers trusted his company, liked their work, and actually wanted his company to provide more ongoing maintenance for them as well. They asked for weekly lawn and garden service, annual weed removal, yearly tree-trimming, winterization service, and annual irrigation repairs. Some of his customers owned pools and also wanted his company to do their pool service, maintenance, and repairs. Some customers had young children and wanted swing sets and playground equipment installed. Some wanted new barbeques installed, fencing added, stables for their horses built, cages for their pets, and patio covers added. Some customers asked him if he installed annual holiday lights as well. Some customers even wanted his company to offer debris and junk removal and hauling. WOW! All that business and Joseph hadn’t even thought about providing it for his customers. Continue reading

Contracting is not just about construction!

How can construction companies increase their steady stream of ongoing reliable sales income regardless of the economy? What type of ongoing revenue can your company, employees, infrastructure, technical skills, reputation, equipment, knowledge, customer base, experience, or potential generate? Attendees of my two day Profit-Builder Circles come to learn how to get their business to work the way they want them to and then take them to the next level. As I look back over the hundreds of past attendees, the business owners who are the most successful are the ones who have two types of contracts, revenue sources, customers, and business models. They do both lump sum contracting work plus have a significant amount of their revenue come from steady ongoing service accounts.

These successful contractors don’t rely solely on bidding single jobs, one at a time, to generate most of their revenue. When you mainly rely on bidding or negotiating work to win contracts, your business becomes ‘fast and furious.’ Your business is either hot or cold, fast paced or dead, busy or slow, and you cant’ control your workload and your revenue isn’t steady or reliable.

‘Slow & steady’ business keeps your crews busy as the workload keeps on coming regularly over and over every month. You can count on a steady flow of work as annual service contracts provide ongoing revenue. With steady regular service accounts, you can plan your schedule, workload, and cash-flow.

Multiple types of income, contracts, and revenue sources compliment each other. This business model allows these type of companies who do both bid and service work, to become very efficient, generate steady workflow for their employees, and create wealth for the owners. But they require two different types of management, sales efforts, cost accounting, customer service, employee training, professional standards, and marketing efforts.

Steve is an electrical contractor who has two separate companies that work together. He has a new construction division that bids to general contractors and does commercial projects, large shopping centers, and office buildings. He has ten steady general contractor customers who typically give his company enough work to make a small profit during good times.

As an offshoot to his contracting company, Steve started an electrical service company several years ago that installs, services, and maintains back-up power generators for homeowners, commercial facilities, industrial plants, hospitals, government buildings, and offices. This company seeks annual contracts for all service work required to keep customer’s buildings electrified during power failures. This specialty service work includes design, engineering, preparing studies, permitting, new installation, repairs, maintenance, testing, fueling, implementing technology, and ongoing monitoring work to insure the generators will work when needed. This service business has grown as he has focused on acquiring new customers, providing excellent customer service, regular weekly employee training, and lots of sales and marketing to attract potential customers. Continue reading

The 8 Traits Of Great Companies! Traits 1 through 4

Vision | Targets & Goals | Organizational Structure | Profits
Part 2
 
Trait #1 – Start with an exciting vision!

What do you want to happen with your company and where do you want it to go? Leading companies start with an exciting focused passionate vision connected to the specific results they want. Some companies have a vision to be the best company in their marketplace with the biggest market share. Others want to be known as the best service provider, provide the best quality, or offer the lowest price. Great companies ramp up their visions with more excitement. Exciting visions of great companies read like these: be recognized as the leader in customer service, being number one in building difficult technical projects, finishing jobs ten percent faster than our competition, or being known for helping customers make a profit. Bill Gates of Microsoft had a big vision to put a computer in every home. Ask the people who work for you and a few customers, “What’s the vision of our company and what are we trying to accomplish? If they don’t know, you’ll never become a great company. What is your passionate vision that will excite your customers and employees?

Trait #2 – Write and track your targets and goals!
After defining your exciting vision, specific results must be written down and targeted to quantify exactly what’s expected for your company, departments, people, and projects. For example, if your vision is to be the best service provider, determine what specific measurable results would enhance your bottom-line. Some targets you can track include obtaining a referral from every customer, only five percent callbacks, no installation errors, or 98% on-time completion. What specific targets and numbers can you shoot for to realize your vision & get the results you want? Without specific clear targets, your people really don’t know what ‘try to make ten percent gross profit’ or  ‘try to do quality work’ or ‘try to be the best’ really means.

What are your top priorities and specific targets your company is shooting for? You need to then monitor and track the progress if you want to achieve your company, department, and project goals. Ask your people what results are important. You’ll probably get 17 different answers if you have 17 people working for you. To get the results you want, write down and track your targets to get everyone on the same page from top to bottom.

Trait #3 – Draft your structured organizational chart!
Company managers and employees who don’t have written detailed job descriptions, don’t know what they’re 100% accountable for, don’t have authority to make decisions, and don’t have an understanding of the clear lines of communication in your company, can’t be held responsible for producing the results you want. Without a structured organizational chart and a list of accountabilities for every position in your company, your people will wait for their boss to tell them what to do next. This limits employee’s growth, enthusiasm, production, and efficiency. Plus it stalls the company so it can’t grow beyond the owner’s ability to make every major decision for everyone.

It doesn’t take a lot of time to layout your perfect organizational chart. Each position’s duties and responsibilities must be considered, detailed, described, outlined, and assigned listing the accountabilities and expected results desired and required. Only with these clear descriptions can people help the company grow and become great.

Trait #4 – Know your numbers and make big profits!
Many business owners are too busy to be bothered with watching and tracking their numbers. Can you imagine the CEO of a major company not focusing on or knowing their company’s revenue, direct costs, fixed costs, and profit? You can’t make a profit if you don’t know what to charge and how much you need to bring in. Many companies shoot for moving targets by attempting to make ‘as much money as possible’ or ‘more’ than they are currently making. ‘As much money as possible’ is not a target. ‘More!’ More than what? These are not clear targets or goals. 5%, 10%, or 15% are not clear targets either. As your sales and job costs vary each month, your total markup earned changes, while your fixed cost of doing business remains the same. This causes your net profit to move up and down like a roller coaster.

The owners of great companies spend a lot of time making people accountable to achieve the numbers. They set specific targets and keep track of the progress towards them. Annual sales of $5,000,000, overhead target of $600,000, and a net profit goal of $200,000 are specific fixed targets you can shoot for and hit. Not More! Not as much as possible! With specific targets for sales, costs, overhead, accounts receivables, cash flow, and net profit, you stay focused on the lifeblood of your company.

The 8 Traits Of Great Companies!

Earn More, Work Less, Live Life!

Good news! Now is the best time you’ll ever have to take a hard look at how your company does business. Why wait? When you start a company, you’re happy getting some work and making a little money. Then it grows into the company it is today by doing what it does relatively well for the few customers it has acquired. As an expert on entrepreneurial companies, I can tell you this is not the right way to design and build a great company that maximizes its’ potential market share, resources, people, and bottom-line profits.

When studying market-leading companies, you’ll find they have eight traits that make them stand out and stay at the top of their field. Make a list of top companies who are leaders in their marketplace. Your list might include: Apple, Caterpillar, Wal-Mart, Microsoft, McDonalds, Ritz Carlton, BMW, FedEx, Forbes, Star-Bucks, or Google. What sets them apart from the rest of their competitors and allows them to continually maintain market share, growth, and profitability?

Owning a company that offers the same basic services or products as most of your direct competitors will keep you busy during good economic times. But as the economy struggles or shrinks, business becomes more difficult, harder to grow, and make a profit. Especially when you offer almost exactly the same thing as most every other company you compete against. In order for your company to become the leader in your marketplace, you have to offer something unique or different than your competitors do. You also have to be passionate about your vision and where your company to go. You need organized systems and a professional management team that consistently delivers the same results for your customers every time. And you must be clearly focused on hitting your targets, goals and financial numbers. With these characteristics, your company will make an above average profit margin and have extra funds leftover to invest in wealth building opportunities.

IS YOUR COMPANY GREAT?
Take this True / False Test to determine if your company has the eight traits of great companies.

1. Our company has a written passionate vision that is prominently displayed for all of our customers and employees to see. Every manager and employee knows exactly what the company stands for, its’ values, and where it’s going.

2. Our company has written targets and goals for the overall operations, each department, and every project. These goals are tracked every month so adjustments can be made quickly.

3. Our company has a structured organizational chart clearly describing the accountabilities and responsibilities for each position in the company. Every employee knows exactly what they’re responsible to do and is fully accountable to make it happen.

4. Our company owners and managers are focused on achieving the numbers required for the company to hit its’ financial targets and goals. Our company makes a very large profit compared to the industry average and our competitors.

5. Our company has a unique or different delivery system, product, or service that attracts customers who will pay more to buy from our company than our competitors.

6. Our company has an ongoing, systemized, and pro-active sales and marketing program to find, contact, attract, retain, and service our customers. Our sales and marketing system has allowed our company to grow at least fifteen to twenty percent, or more per year.

7. Our company has written operational systems and procedures for all employees to follow that insure all workflow is completed in a similar standardized manner by all employees without exception.

8. Our company’s bottom-line delivers significant excess profits that allow us to seek investments and find opportunities to grow and build our equity and wealth. Continue reading