4 New Year’s resolutions every contractor should make to improve their business in 2014
| January 03, 2014 |
Your crews have been sent home, most of your machinery has made it back to the yard for a yearly maintenance run through, and it’s time to celebrate another full year of being in business. During this less-than-full-throttle time (assuming a client doesn’t call with an emergency), consider these ways you can get on the right foot for the new year. (Click the links in the copy of each step to read more detail about how to carry them out.)
1. Get a handle on your true costs
Now that your year has come to an end, take a magnifying glass to your costs, and look at whether they’re required to run your company. Make a list of those than should be questioned when your full team is back to work. Make it a habit to do cash flow budgeting and projections, since they’ll help you know where your cash surplus and shortfalls are during a specific time frame.
2. Learn to recognize the early warning signs of financial trouble
While your backlog may be looking a lot more healthy right now than in previous years, author and consultant Michael Stone of markupandprofit.com says signs you may not be that financially healthy include paying old bills with money from old jobs and not taking a regular salary from the business. Stone says an updated business plan is a must for contractors. Take time each year to review what went right and what went wrong and how you can improve it.
3. If you haven’t gotten bonded, take the necessary steps to do so
It takes time and preparation, but getting bonded will give you more opportunities and help establish your firm as a serious player in the local market. Ask around, and get bonding agent recommendations from other contractors. When you do work out a deal with a bonding agent, recognize that they can become one of your trusted advisors. They’ve seen the business practices of contractors who do well, and are painfully acquainted with those who don’t.
4. Review your marketing practices
True, word-of-mouth, reputation-based marketing does work, but only up to a point. You’re always on the lookout for premium clients, but it’s impossible to chase every possibility with a physical presence alone. Resolve to get together with your team and determine where you want to go, who you want to reach, and what low-hanging fruit will help move you in the right direction. The initial steps don’t have to be complicated or costly.
Finally, if you don’t have a website, get some web designer recommendations from contractors who do. A website is a critical step forward.