Should you add another trade?
Well, that’s the second question you should be asking yourself.
The first question you need to ask (and answer) is, “Are we paying attention to changing market conditions and monitoring how well our company is functioning with the trade or trades we already do?”
Before making any decision, I recommended doing the “Daily Business Meditation.”
Ever since artificial intelligence chatbot ChatGPT hit the mainstream in the spring of 2023, I’ve been fielding questions about whether it can be used to create operating manuals (aka Standard Operating Procedures (SOPs)).
The short answer is absolutely. It can generate text that tells you how to do a toilet reset or replace an electrical box.
There are, however, some issues you should be aware of. To understand these issues, you need to know a little bit about what is behind ChatGPT and other “generative” Ai models.
If you’re thinking that it can be used to generate all your procedures from scratch with zero human intervention, let me explain why you might want to think that through.
If you’re trying to grow your company primarily through marketing (or, what I call organic marketing), you’ll be pleased to learn there’s another tried and true way to accelerate the growth process, especially if you have the right stuff in place.
That way is to acquire other companies. In other words, you buy your way to growth.
Why acquisition? Acquisition is about instantly acquiring a lot of customers who are already trained to buy from that company where organic marketing is just a wish and hope that they’ll see it and respond to it.
You could also acquire the company’s good will and sometimes their assets like trucks and inventory or even their building and key talented people many times.
The business you’re running today isn’t necessarily the one you need to achieve your goals. I know this is a hard pill to swallow. In fact, most people in this situation will defend the status quo even though their business may be like a “boat”… full of holes and rapidly sinking.
If this is you, you probably need a way to release your emotional attachment to the situation. Here’s an exercise I recommended to my 1-1 clients and really to every contractor to do periodically so they can more objectively evaluate what is going on—and what needs to change.
Imagine for a moment you’ve closed the doors at your existing company and are going to reopen it down the street as a brand-new company.
The goal is that you end up with a business that works right this time and that requires you do a real self-assessment of your business today:
I once asked a great client about what he was doing to build credibility and increase his visibility in the community his company served.
He said, “We’ve sponsored a giant community carnival. One of our many giveaways was free ice cream and along with that we gave folks discount coupons for our services. It was great! It was a big hit for the community who loved our supporting them and it benefited us as well, by generating trackable lead source quality calls that increased our revenues. A great Win-Win-Win.”
“How’s it working today?” I asked.
He started to laugh and replied, “Well, I hate to admit this but we don’t do it anymore.”
Moral of the story: If you are doing or have done things that you know already work to get you known, give someone ownership of it and check in with them at a weekly meeting to make sure progress is being made consistently.
There are four main ways to do this.
The last thing you need to be doing in these uncertain times is to stock your trucks too heavily. You don’t need to be paying for excess inventory, for things that get damaged, or go out of warranty sitting on a shelf.
Just as bad, however, are trucks that aren’t stocked well enough to give your Techs a good chance to make an immediate sale and do the work. Always needing to chase parts is a waste of time which damages billable hour efficiency and can lead to lost sales.
My Service Manager at my company told me, “You can’t sell from an empty wagon.”
I replied, “What?”
He said, “If you don’t have it onboard, you’re unlikely to stop and go hunting for it.”
The goal should be for your Techs to pull up to 80% of the homes you serve with a truck that has the stock that will give them an 80% chance that they’ll have what they need to get the job done today.
As I had promised at the end of Part 1, I’m going to share a sample of the letter you should send to customers announcing your company name change plus a bunch of great tips for executing the name change the right way. This is the also the same letter you will need to reformat a little to do an email blast to your customers.
Remember I said that all the great marketing knowledge I learned from my marketing guru, Leo, is still working great for my 1-1 clients to this day, and I’m going to share more of it with you here!
Here’s a sample of a letter I wrote for a client of mine who was changing the company name to end some confusion in his market and to launch his rebrand as well as some additional tips for doing a name change the right way.
What makes me an expert on when and how to change your company name and/or rebrand?
My family business was originally in just fuel oil heating (think propane heating), and my dad and my uncle were always doing acquisitions because urban renewal had chased our customers out of our service area. When they acquired a new company, they thought people wanted to do business with a company name they were familiar with.
Well, skip many years ahead and my brothers and I are at work alongside my dad (as my uncle had passed away). Anyway, one cold day in February, I went to a Super Bowl party, and I heard a couple of people getting into a heated argument, so naturally I got closer so I could hear what a couple of fellow New Yorkers were arguing about.
One of them said to the other, “I have the best heating company there is.”
The other replied, “You don’t know what you’re talking about. I have the best heating company!”
I asked them both which company they used, and they told me the names. I gulped. Both were using me, but they had no idea we were all one company! Worse, there were four other companies we also owned that were in the same situation!
Let’s say I gave you $100,000 to grow your business. You go to dinner to celebrate your great windfall and then the next morning you’re at your desk, admiring the check.
Here’s my question: Would you know what to do with it, first, second, and third for the greatest impact? $100,000 sounds like a lot of money especially if you’re the typical contracting company which is at $2 million a year or less, and sometimes way less. But it’s also an amount that can disappear remarkably quickly unless you have a plan and use the money to execute that plan.
The other thing I know is that some problems aren’t really money problems. The problem is some people would only have fallen deeper down the hole if they had gotten a hundred thousand dollars.
Why?
They were lacking Planning Power, which means a plan on which projects to work on. They didn’t have systems like Operating Power (today it’s my Signature Operating Manuals System program) so they threw people at the problem hoping they’d magically make everything work right.
If I did give you 100,000 dollars, you would need systems to help you know how to spend money on the right things in the right way.
Would you drive your personal vehicle 100,000 miles and never do an oil change? Ignore the flashing red engine light on your dashboard hoping it will go away? Continue to drive it after you dropped the front wheel into a deep pothole at 70 mph?
Of course not!
You would take steps to maintain and fix the vehicle as soon as possible. That’s because you are the manager of your personal fleet of one, two, three (or more) vehicles and you know waiting will only end up costing you more in the end.
When it comes to the fleet for your contracting business, however, the consequences of not being proactive has yet another layer of risk and a huge financial impact. That’s because each one of your trucks is a rolling cash register and every time one of your trucks goes out of service, your ability to generate revenue for your business goes with it. To avoid this, you need someone acting as the Fleet Manager. Someone has to have the job to make sure those trucks not only stay on the road but also are utilized properly by the Technicians who are operating them.
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