Providing great service isn’t the secret to successfully scaling your small independent contracting business. It takes more than skill and technical know-how to elevate your company and reach the next level.
A lot more.
Great Service is not Enough
To plan and execute an effective growth strategy for a modern plumbing services business, contractors must have a vision and entrepreneurial instinct that can’t be developed in the field. Mastering the hard skills of the trade—installing, maintaining and servicing complex equipment—won’t necessarily translate into growth.
A company that wants to grow must provide great service in those areas. Customers recognize lackluster service. In all but a few cases, mediocre businesses that don’t deliver true value won’t find sustained success, regardless of their creativity or branding.
At the same time, offering great service alone will never be a sufficient strategy to scale a company. Even if you’re a world-class technician, a wide range of other skills and priorities are ultimately required for long-term growth and financial security.
Basic Principles
Effectively managing your company’s finances is the foundation for any business owner looking to scale. Ultimately, investing in your company’s financial best practices is an investment in its future—and yours.
Fortunately, contractors don’t have to commit to earning an MBA or marketing degree to achieve their goals. You don’t even have to hire a full-time finance expert. But if growth is on the agenda, you should familiarize yourself with the basic principles of sound business operations and make an informed decision about implementing a strategy for financial security and growth.
· Balance the books and review your reports: Entering info into a register may seem simple enough. But fall behind in your financial record-keeping and you may have a mess that’s impossible to clear up without the assistance of a high-priced professional. In addition to staying on top of entries, it’s important to regularly review your accounts and all your other financial reports to get a snapshot of the company’s financial health. Over time, you’ll identify valuable insights and start to see meaningful trends—as well as potential roadblocks and challenges.
· Keep cash flowing: You can’t simply count on money being accessible when you need it, especially in seasonal industries. Create a plan to ensure your company always has enough cash on hand for normal operations as well as expected increases in costs and any potential surprises.
· Save strategically: You need cash coming in. You also need to put cash away for future use and to plan for emergencies. Finding the right balance for your company depends on your goals and many other factors, but saving now to prevent potential catastrophe is critical for keeping your company in position to grow.
· The price is right: Don’t trust your gut or your intuition to set prices for the market you serve. Profit margins are the key to growth—detailed information, precise planning and careful projections should be the basis for decisions related to the future of your company.
· Appreciate your assets: Understand the value and tax implications of assets such as real estate, your truck fleet, large equipment and even inventory so you can take advantage of appreciation or depreciation and avoid getting stuck with unnecessary or unexpected expenses.
Prioritizing
For many small business owners, financial management can seem like a burden. They opened their own service business to find flexibility and freedom, not to fill out spreadsheets.
Sound reporting and management, however, is essential for the long-term sustained growth that fosters true financial freedom. That doesn’t mean business owners need to devote their weekends and evenings to a new suite of financial software. It does mean, though, that they must find ways to prioritize their financial management and other key business administration.
One way to ensure proper management and the freedom to grow is investing in support services and technology specifically designed for contractors. Many solutions are available to help outsource back-office and administration tasks so contractors can focus on what they do best. The right suite of options can provide powerful financial services as well as industry-trained call-answering reps available 24/7, dispatch service and assistance, service-agreement maintenance and more.
Lynn Wise is CEO and founder of Contractor in Charge, the top provider of start-to-finish 24-7 customer engagement, appointment booking, full-service bookkeeping and controller services for home service contractors. Contractor in Charge was established in 2016 to provide comprehensive office service for home service contractors. With trained industry-experienced employees and integration with a full range of cutting-edge technology platforms, Contractor in Charge allows business owners to cut costs while maintaining the same quality of service.