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Columns

The Top 10 Things A Contractor Can Do -- But Shouldn't!
Ellen Rohr

By Ellen Rohr
January 1, 2003
Words of wisdom for the New Year.

If you do what you should not, you must bear what you would not."-Benjamin Franklin

Sure, there are a lot of things a contractor can do that will lead him to wild success. Just as important are the things you can do - but shouldn't! Here's my take on this month's assignment:

1. Worry about what the other guys think.

"To avoid criticism do nothing, say nothing, be nothing."-Elbert Hubbard

The moment you choose to rise above the rest, the rest will not rest until they drag you back down. Ignore the other contractors in your market area. Let it be known that you are growing. You are buying companies. You are recruiting plumbers. You are aiming to be the best contractor you can be. Then, let like-minded competitors find you. But quit trying to convert the masses to the better business path.

2. Work with your spouse.

"To keep the fire burning brightly, there's one easy rule: keep the two logs together, near enough to keep each other warm and far enough apart - about a finger's breadth - for breathing room. Good fire, good marriage, same rule."-Marnie Reed Crowell

Sure, some of you work pretty well together. I may be prejudice because NOT working in the same business with my beloved husband has been soooo much more fun than working with him day in and day out. Still, if you are working together, I encourage you to face these big questions: WOULD you, if you were starting over from scratch right now?

Is contracting your heart's desire? If you won the lottery, would you continue on in your spouse's business? If "Yes, Yes, Yes," then congratulations are due. If "No way!" then start planning an exit. Often a contractor enlists the help of his wife just because he can and she will.

3. Be Internet illiterate.

"Never to have changed - what a pitiable thing of which to boast!"-Johann Wolfgang von Goethe

It's time to get over your fear of the Internet. Sure, you are busy. Yes, you are already behind on your correspondence. However, e-mail is the most efficient way to communicate most information.

It doesn't take the place of face-to-face dialogue. It does document and deliver communications much better than telephone or voice mail or a passing comment made to a distracted listener.

And, you could get rid of 90 percent of the paper in your office if you really understood what's available to you via search engines and Web sites. Quit bragging about your Internet illiteracy and get on the bandwidth bandwagon.

4. Offer multiple pricing options.

"Soon after a hard decision something inevitably occurs to cast doubt. Holding steady against that doubt usually proves the decision."-R.J. Fitzhenry

Recently, I tagged along with a wonderful plumber on a service call. Before we got to the customer's home, he pulled the truck over to organize his paper work and get ready for the call. He assembled his price book with the following components:

  • regular prices
  • prices for the few things that he may get price complaints about
  • items that were open to negotiate $75 off the price
  • after 5 p.m. but before 8 p.m. prices
  • after 8 p.m. but not on Sunday prices
  • Sunday prices
He wasn't making this up. These pricing options came directly from the big cheese. While his boss had good intentions, the result was confusing.

Help your plumbers and create a solid price book. Keep it simple. Calculate your price for labor. Offer one service fee. Have one column of prices. Learn to sell value. Your financial statements will let you know if your pricing strategy is working or not.

5. Hold out for a maximum selling price for your company.

"Only man clogs his happiness with care, destroying what is, with thoughts of what may be."-John Dryden

At some point, you are going to consider selling your company. If you are 45 years old or younger, you may not realize this. If you are 55 years old or older, you may be obsessed with selling. Someday, you will need to, or want to, pass the business on.

Perhaps you have already been asked to sell. Was the selling price less than you would like? You have two options:

  • Increase the worth of your company by getting really profitable.
  • Sell it anyway and count your blessings.
If you are ready to move on to the next phase of your life, then don't hold out for more. Sell and move on. There is life beyond the one you are currently living.

If you are not growing your company, it's shrinking. Nothing stays the same in this universe. So unless you intend to do what it takes to make your company more valuable, your company will be worth less a year from now.

I am getting old enough to have watched this scenario play out dozens of times. It's just a business. It's not your identity. Acknowledge your accomplishments, the money you made, the lessons you've learned and pass it on.

Otherwise, get going and get growing. The more money it makes, the more money your company is worth.

6. Use a picture of a pipe for your logo.

"Advertising is one of the few callings in which it is advisable to pay attention to someone else's business."-Howard W. Newton

Don't go for the pipe. Or a drip. Or worse yet, a picture of a plumber showing butt cleavage. (Check your Yellow Pages if you think I am making that up.) The drip and pipe may clue folks in that you are a plumber, but the images won't help them remember YOU when they need service.

What are you going to do to differentiate yourself? Craft an identity - a name, logo and message that will key customers in to your unique ability to serve them better than anyone else in the book. (And the butt crack image isn't funny, clever or anything but detrimental to the health of our fine industry.)

7. Use your last name as your company name.

"I don't remember anybody's name. How do you think the 'dahling' thing started?"-Eva Gabor

I mean no disrespect. It's been a tradition in our industry to name your company after your daddy. However, if you want to grow your business, your name may be holding you back. These days we are inundated with so many marketing messages every day: billboards, radio, TV, Internet and so many other advertisements. Does your name stick to the minds of every man, woman and child in your market area? Don't kid yourself.

Another point to consider: when you sell, you may have more flexibility if your name isn't tied to the goodwill of the company.

8. Create policy for the exception, not the expectation.

"We expect the fundamentals of behavior to be complicated simply because so many highly complicated people have discussed the subject."-L. Ron Hubbard

For the most part, do you expect people to behave reasonably? Do you believe that man is basically good? Sure, customers can get stressed out and take it out on you. Plumbing is inherently a problem-based business. Nobody likes calling the plumber.

Generally, customers are fairly reasonable. Every now and then, you will run into a full-blown nutcase, or a person who genuinely wants to get something for nothing. But how often? If you are tracking this kind of info, you will find that less than one out of 100 customers is a bonafide evildoer. Don't create policy that affects all of your customers to thwart the one or two who really have it in for you.

Aim for the expectation, not the exception. For instance, I don't recommend testing each cash transaction for counterfeit bills. It might happen. But the ill-will caused by dragging that test pen across twenty dollar bills, while your customer watches, is just not worth it. The same holds for employee policies.

9. Give estimates.

The word "estimate" should be stricken from your vocabulary. "Estimate" is a surrender word. When your plumber responds to an "estimate" call, free or otherwise, he or she is surrendering the possibility of a sale. Why not treat an "estimate" like every other service call? Isn't the customer really looking for a solution to a problem? If your solution is compelling enough, won't the customer buy? You bet!

Have fun with this. Start fining yourself $1 for every time you say the "E" word. Customers can say it. They don't know better. You do.

10. Whine.

"The enemy is in front of us, behind us, to the left of us, and to the right of us. They can't escape this time!"-Marine Lieutenant Lewis B. Puller

Some folks on this planet are looking for clean water and a way to stay warm tonight. What on earth do you have to complain about?

2003 is poised before you. Just because you CAN, should you? Substitute the words intend, will and choose for the word CAN ... and make this year an amazing one!

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Ellen Rohr is the president of Bare Bones Biz, a training and consulting company.

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