Why are 80% of remodelers struggling? Why are these companies falling short on the sales targets and forecasted net profit?
Every remodeling business is unique, but there are some common denominators. The following are a few typical business dynamics to highlight.
Today the pace of business is much faster. If you drive a car at 40 miles an hour, you have plenty of time to react to a deer in the road. But if you are driving 80 miles an hour, it’s harder to avoid an accident. Your reaction time in business today is a fraction of what it was 10 years ago.
Today’s client is more demanding. This is partially a result of their stress but also the desired transparency in remodeling processes. They know as much about products and costs as you, and therefore questions are more numerous, and trust levels lower.
The talent pool is smaller. Not only are the craftsmen getting older, but they also have many employment options and are less loyal to you. This results in more turnover, which disrupts the process and the business.
These are just a few common scenarios I am sure strike a chord and make things tougher. Following are three tips for how to counter some of these and struggle less.
1] Know your numbers. It is not enough to know how many leads you get per week. Where did they come from? How does this compare to the forecast? To last year? How many leads resulted in an appointment? I suggest spending one hour a week looking deeply at the numbers and making adjustments based on this knowledge.
2] Focus on your sweet spot projects and client demographic. Think of your business as a target at a shooting range. The bull’s-eye is your sweet spot. Try to identify the right client demographics, the right geography, the right project size and type. Then make sure you eliminate or say “no” to the ones that don’t match that description.
Many remodelers today are struggling in part because beneficial adjustments to processes and thought patterns are not being prioritized or enacted.
3] This is a team sport. You are not alone. When you struggle, the team dynamic and culture often break down. It is more important than ever that you focus on the culture. Listen to the voices around you and react quickly. If you are struggling, be assured the team might be having a tough time, too.
While these may be obvious suggestions, most remodelers are struggling in part because these are not made a priority. When we get overwhelmed, we tend not to focus on the one thing in each area (people/process/product) that will keep us on track.
You can only do so much about the pace of life or the controlling clients, but you can change how you look at it and how you react to these conditions.
The skills required in business today are higher than ever, but I do believe it is a choice to struggle or not.