Whenever I talk shop with someone in the installation business, they always mention that they just dont have enough time. This constant stress is not good for business, and it definitely affects our personal lives.
Beginning and sustaining a small business requires a huge investment of time and energy. Simply working harder and longer is not a proper long-term solution for success in your business.
I once called a top-notch architect with whom I had worked in Aspen to see if he had any new homes on his drawing board. Of course, I wanted to provide the AV systems if possible. His unanticipated response really made me stop and think. We dont need any more work. We need more money. The wisdom of these words still speaks to me today.
Working harder and harder cannot solve the problem. No matter how optimistic someone is there are very finite limits of how much time and energy a person can put out in a lifetime. To be in a state of denial about your true limits puts you at risk of damaging your business and your personal life.
Here are some philosophies and strategies that I believe can help us in this race against time. Many custom installation companies have created business models that cannot grow beyond the personal limits of one or two key people. Take the example of a small company that installs lots of structured wiring. Since almost all income for this type of company is based on selling labor by the hour, it is impossible to make more money without putting in more hours. When their crew is booked for 40 hours a week, they hit a wall where there is no way to grow or increase profits.
After arduous years in the prewire business, the balance of effort and reward can grow wearisome. The scary part of running this type of business (without financial security and benefits) is that you can wind up more like an hourly laborer than like the original dream of owning your own thriving business.
Alcoholics Anonymous teaches that the first step to recovery is to take a fearless personal inventory and admit that your life has become unmanageable. What is true for alcoholics is also true for workaholics.
Whether you do wiring or full-blown installs, your company needs to relentlessly find ways to make more money with less effort.
Here are 10 specific strategies for making more money with less effort.
1) Stop selling labor for wiring and installation while letting someone else profit from selling the equipment. If you invest your time and labor, you have done the work and should reap the profits from the gear.
2) Never be the low bidder. Yes, you will lose some jobs, but that is great news, because you will lose the worst jobs (the ones that were not profitable anyway).
3) When your calendar is fully booked to the point where cannot take on new jobs, raise your rates. Once again, you will lose the bad jobs, which only increases your profits.
4) Find reliable subcontractors to help take up the slack on wiring when your crews are maxed out.
5)It takes the same amount of hours to install great equipment as it does to install junk. Make more money by selling the best products you can. Great audio and video will make you money.
6) Run your company lean and mean. (No inventory, low overhead, no dead weight.)
7) Stop customizing! Create good, better, and best standardized systems and sell them all the time. You will be amazed at the profits here.
8) Streamline your workflow from proposals through installation.
9) Do not waste time micromanaging inventory or bog down in red tape.
10) This is a sales-driven business. Keep your salespeople focused on selling.
Running a successful business is about maximizing your return on investment. We all have a limited amount of time that we can invest. We must implement these strategies to maximize the returns we can earn beyond those limits of how hard and long we can work.
Dont tie your profits to hours in the day. Unleash them. To make more money with less effort, we must sell much more than hourly labor. Then we win the race against time.