Friday, January 30, 2009

Fear

It is often said that fear is False Evidence Appearing Real. While this is often the case, there is more to fear than that.

Fear is an emotional response to a perceived, unknown threat. For example, if you hear a loud knock on your door in the middle of the night, you might experience fear—you perceive a threat because you do not know who is at the door. However, if you are expecting someone, the same noise will not evoke a feeling of fear.

The owners of paint contracting companies are often reluctant to make changes in their business because of fear. They perceive some threat—perhaps failure—and the consequences of the change are unknown. This isn’t necessarily irrational, or making false evidence appear real. The chance of failure does exist, and there are unknowns.

Overcoming our fear is necessary if we are to move forward. There are several key steps in this process.

The first is to identify the actual facts. Are there as many unknowns as we think? Have we made similar changes before? Can we learn from others who have made similar changes? Answering these questions can help us realize that the unknowns are not as significant as we think. We may actually know more about the situation than first appears.

The second step is to identify what information we can obtain to reduce the unknowns. This may involve soliciting the input from someone who has made a similar change or doing research. Knowledge is certainly an ally, as it helps eliminate or reduce unknowns.

Armed with this knowledge, we can then develop a plan that will reduce risks and address any remaining unknowns. The plan allows us to think through the change, identify potential obstacles, and have a specific course of action.

The process of overcoming fear is designed to reduce the perception of an unknown threat. As we gather more information, the unknowns decrease. As our knowledge expands, the perceived threat is reduced. In combination, our fear will be greatly diminished and we will be prepared to move forward.

Monday, January 26, 2009

The Paint Police

As the owner of a paint contracting company, I have an eye for spotting poor paint jobs. Almost without thinking about it, any time I enter someplace I am inspecting the paint job. And often, what I see is offensive to anyone with a semblance of standards.

I see brush strokes going in five different directions. I see touch up that doesn't match. I see lines that wiggle more than a worm on hot pavement. I see application problems and preparation problems. But most of all, I see a serious threat to the well-being of anyone who enters that building. We need a law to protect people from shoddy paint jobs. We need the Paint Police.

You may think that this is absurd. You may think that I am being sarcastic. You would be correct on both counts. But this is no less absurd than many laws that are proposed. And I can make a good case to support such a law.

Paint is composed of hundreds of chemicals, including volatile organic compounds, titanium dioxide, resins, and some other things I can't even spell. Some of these chemicals can be quite dangerous, and when combined they become a virtual Chernobyl. For example, if you ingested one ounce of 100% pure acrylic latex paint, you would experience severe stomach problems.
Few people realize that paint off gasses for a prolonged period--sometimes for years. So, while you may not saddle up to the bar and order a shot of SuperPaint on the rocks, you could be ingesting toxic fumes anytime you are in the proximity of paint.

Look around you. I bet you can spot a lot of things that have paint on them-- your walls, the woodwork, your furniture, and perhaps your shoes. (A little known fact is that most leather shoes are painted in Brazilian sweat shops by artisans who make cheap banana leaves look like expensive leather. But that is a different story.) All of these products are emitting toxic chemicals that are slowly destroying your liver. And the problem gets even worse if you start gnawing on one of these items.

You are probably thinking that you never gnaw on your furniture, your walls, or your shoes. And if you don't then I give you a lot of credit for your self-control. You see, paint manufacturers add secret ingredients to their products that subconsciously create strong gnawing urges in humans. During WWII, government scientists worked with the paint companies to find ways to influence enemy behavior by adding certain ingredients into paint, and then Allied bombers dropped tons of paint on villages throughout Europe. The result was very colorful. But I digress.

One of the primary problems with paint is poor adhesion. If the paint doesn't stick to the surface to which it is applied, it will come off. The result is peeling, flaking paint. Because of the secret, enticing ingredients in paint, humans will unknowingly ingest it. This often occurs in the middle of the night. This phenomenon has been documented in numerous B-grade movies.

Many people mistakenly believe that a paint job just requires picking a color and slapping some paint on the wall. Au contraire. There is much more to a high quality, long lasting job. Things such as picking the proper roller nap, using the right primers, and drinking an approved beer. Unfortunately, there are many people out there who are applying paint and don't know the difference between an eggshell and a satin. These people pose a tremendous public health risk.

It is time that we do something about it, and given the aroma of change that is in the air, this is the perfect time to do it. We need the federal government to enact sweeping regulations to insure that all paint is applied properly. We need to crack down on those who denigrate our trade, and do other things that I don't like. I urge you to write your Congressman and Senators in support of this proposal.

And while you are at it, you might suggest that they make me the Paint Czar.

Friday, January 23, 2009

How to Stay Busy

I frequently talk to someone who will remark that some contractor is staying very busy. They say this with great respect and awe, and there was a time that I would have had a similar attitude. But staying busy really isn't such a great accomplishment. In fact, it is very easy to stay busy.

Staying busy just means that you have a lot of work. Actually, it doesn't even mean that--it really means that you are doing a lot of work. But if that "work" consists of putting out fires, are you really staying busy? If that "work" isn't profitable, is it really a good thing to be busy?

There is one way to stay busy that is almost fool proof. I say fool proof, because it is usually fools who use this method, and they don't seem to mess it up very often. That method is-- (drum roll please) charge dirt cheap prices for your work.

If everyone around you is charging $25 an hour, imagine how much work you can get if you only charge $15 an hour. You will have more work than you can ever imagine--everyone will want to hire you. Of course, you won't make any money unless you hire a pack of circus chimps to do the work. And then you will likely have lots of problems, which will keep you even busier.

Staying busy is really not what you should be worried about. Making money should be your primary concern. If you could make the money you want/ need and only work 3 days a week, would you complain about not being busy? I didn't think so. Certainly, we want to have an adequate supply of work. But that is vastly different from staying busy.

Some contractors seem to equate staying busy with success. Au contraire, mon frère. Try painting interior walls with a 2" sash brush--you'll be busier than a bumble been. And you won't be very successful if you consider being profitable the measure of success. In other words, you can spend a lot of time doing something, but if your efforts are inefficient, you won't accomplish the results you want.

Staying busy is wildly overrated. And usually, the contractors who focus on staying busy will soon be busy doing something else-- like looking for a job.

Tuesday, January 20, 2009

What Are the Problems?

If you have been in business very long, you have run into problems on a job. The customer can't make up her mind on the color, or the customer insists you complete a 10 day job in 7 days, or the customer breaks out the magnifying glass and crawls around on his knees to inspect the baseboards. In the 23 years I've been in business, I've experienced all of these things and much more.

The funny thing is, I've experienced most of these problems only one time. Almost every time I have a problem, my contract gets changed to address that problem. And seemingly like magic, I don't have that problem again.

While it is probably impossible to cover everything, and a customer who refuses to abide by the contract will find some way to create problems, getting these issues addressed in writing can make life a whole lot easier.

Some discretion is advised. If we literally addressed every issue in our contract, it could get to be very long and complex. It is more important to address the essential issues, for doing so will often eliminate other issues. For example, if your contract states that no job will be scheduled until paint colors are selected, you won't get on the job and have to kill time while the customer picks colors.

So contract will be perfect, nor will it eliminate all problems. But a solid contract that addresses the majority of the issues that cause problems will go a long way to make life easier.

The True Cost of Bartering

A recent thread on Paint Talk raised an interesting issue. A contractor was considering painting a service station in exchange for placing signs on the property. This is a creative idea worth exploring. However, the costs of doing this are substantially higher than might appear.

The contractor estimated 2 to 3 days of labor and 15 gallons of paint to do the job. Some might conclude that, if he does the work himself, the job will only cost him the price of the paint. This is inaccurate. The actual cost will be much higher.

To illustrate my point I will use the following numbers: his selling price is $40 an hour; his advertising costs are 5%; he pays $20 a gallon for paint. I will also assume that the job will take him 3 days and he will do the work by himself.

Three days of labor equals 24 hours, or $960 in labor. His paint will cost him $300. This puts the value of the job at $1,260. That is the price he would charge if this were a paying customer.

Some may argue that this deal will only cost him the price of the paint. Such a claim ignores the value of his time, as well as the fact that he will still incur overhead. What is essentially happening is that he is being paid $1,260 to do the job, and he is immediately spending that money for advertising.

If he simply did the job without the barter component, 5% or $63 of the job would go to advertising. The other money would cover direct costs, overhead, and profit. But as this deal stands, 100% of the job goes to advertising, with nothing remaining for overhead, profit, or direct costs. In other words, he will be short $1,197 for overhead, profit, and direct costs. Yet these costs are real and must be paid. If he spends nothing further on advertising, he will need to do $23,440 of work before he recovers the $1,197 ($1,197/ 5%). Of course, if his actual numbers are different, the amount of work required to break even will also differ. Also, keep in mind that these numbers do not include the cost of the signs.

If we assume an average job size of $3,000 and a closing rate of 50% (both of which are probably high), he will need 8 jobs and 16 leads to break even. The question he must answer—after using his actual numbers—is whether this seems like a reasonable number of leads to require.

I can’t say whether this is a good deal or not. But the answer isn’t as simple as adding up the cost of the paint. The true cost of bartering is much higher than that.

Saturday, January 17, 2009

Building a Team

A family member recently started a new job and over the holidays he was lamenting the fact that he is on a team of one. Even though he works for a very large corporation, he is working on an assignment by himself. And this assignment involves a topic with which he has little experience.

My immediate thought was that this is no different from the typical painting contractor. Most of us likely started our business as a team of one, and most of us gave ourself an assignment with which we had little experience--operating a business. This certainly was the case in my situation.

When I started my business, I assumed that common sense and hard work would be sufficient to address the issues that would come up. While both are important, and certainly help, they simply are not sufficient. The result was a continual process of trial and error, which was often costly, stressful, and inefficient.

On occasion I would solicit input from family or friends regarding specific issues. While their advice was often very helpful, they didn't understand enough about contracting to provide the kind of assistance I sometimes I needed. So I continued to plod along, making slow but gradual progress (with occasional pauses to pull out large tufts of hair).

The Internet certainly helped change this. With the advent of chatrooms and forums, I suddenly had access to hundreds of other people who had "been there, done that". I was no longer dependent on trial and error.

Of course, the quality of the advice offered on the Internet varies considerably. As I identified those individuals or organizations that offered sound advice, I slowly began to include them on my "team". In addition, I was better able to communicate my vision to my employees and subcontractors. This too improved the quality of me team.

Every contractor should have a team, even if he is a one-man shop. Obviously a smaller business will have a smaller team, but getting quality advice and input is important no matter the size of a company. Even a one-man shop will have need for occasional advice concerning legal, accounting, marketing, or other issues. Having competent professionals available--professionals who have some understanding of contracting--can help avoid costly mistakes.

Your team can also consist of other contractors, whether in the painting business or another trade. While a direct competitor will not be likely to share as much information, general discussions can be beneficial. If you are in a large market, there are likely many contractors who are not direct competitors.

Running a small business can be a lonely endeavor at times. There are many ups and downs, many issues that must be addressed, and many options. Building a team can be an effective way to avoid the problems of trial and error, and build a better business.

Wednesday, January 14, 2009

Happiness Journal

This could be a rough year for many painting contractors. With construction slowing and home owners holding on to their money more tightly, leads are likely to slow. Customers will likely be more price conscious than ever. Since "anyone can paint", we might see an increase in competition.

It could become very easy to get stressed out and focus on all of the negatives. This can feed on itself-- often when we focus on the negatives we stop being pro-active and wallow in our misery. Focusing on the negatives can blind us to the many positives in our life.

In late December somebody turned me on to the idea of a Happiness Journal through HBL. The idea is pretty simple-- each day you write down 3 things that made you happy or brought you pleasure. These don't need to be huge events-- it could be as simple as a good meal or hearing your favorite song. The idea is to spend a few minutes reflecting on the positive.

This can have a huge impact psychologically. It gets us to recognize the good things that we have in our life. It reminds us that there are positives. Just a few minutes a day thinking about what makes us happy can make a huge difference, and it can change our perspective on the problems.

Running a business can be difficult at times. And with the economy the way it is, it could get worse. Anything we can do to keep a positive outlook helps. As the owner of a business, it can sometimes seem like the weight of the world is upon our shoulders. Thinking about the positive can help lift some of that weight.

I started doing a Happiness Journal on January 1. I tend to be optimistic and focus on the positive, but I’ve still found it both fun and illuminating. Some days I struggle to select only 3 items—I have many more to choose from. Other days, finding 3 items has been a little more difficult. For example, I came down with a cold on New Year’s Eve, which made the entire weekend a bit of a downer and less active than normal. But just thinking about what I had enjoyed during the day brightened my spirits.

Life is full of ups and downs. We don't hit a home run everyday. But we don't strike out every time at the plate either. Sometimes a series of singles are just are rewarding and meaningful as a grand slam. After all, a grand slam isn't possible without three other runners getting on base.

My wife is also keeping a Happiness Journal, and we intend to share and discuss the items we have listed. This will be a lot of fun in a number of ways. It will be an opportunity for us to share our thoughts and discuss positive events. We will probably learn a few things about one another.

I certainly don’t mean to imply that we should ignore our problems or pretend that everything is fine and dandy. But at the same time, we shouldn’t ignore the good things and pretend that our world is falling apart. A Happiness Journal helps keep the proper perspective, and that may be more important than ever in the coming year.

Saturday, January 10, 2009

Paint Emergencies

One of my favorite experiences as a painting contractor is dealing with paint emergencies. These can take numerous forms, but they essentially amount to the customer needing the work done immediately. These aren't situations where a water pipe broke and drywall needs to be repaired prior to a party this weekend. There are real emergencies. For example:
  • A commercial customer needs a room painted with a decorative finish. She called at 2 PM and needed the work done that day. She did not have a price, nor did she understand that decorative finishes usually take several days.
  • A residential customer called in the afternoon wanting an estimate that day so that we could start the next day. When he was told that was impossible, he announced that we would not be getting his business. And by the way, he had previously insisted that we give him the cheapest price possible.
  • We also get a surprising number of calls to send a painter over. Apparently some people think we have painters sitting around the office all day drinking beer (that's what painters do, after all) just waiting for their phone call. Most of these calls involve a DIYer who got in over his head and needs a professional to bail him out. These "experts" usually tell us that there is only a few hours of work.
I am not sure whether these types of emergencies reflect a character flaw on the part of the customer, or the public's perception of the painting industry. While it may be a bit of both, I suspect it is more the former.

While it may be possible, I have yet to see a true paint emergency. Unlike plumbing or electrical problems, a paint problem is not going to threaten one's comfort or safety. Unlike a roofing leak, a paint problem is not going to place the house and its contents in immediate jeopardy. So do do people think that they have a paint emergency?

At least in my experience, those who think that they have a paint emergency are typically very demanding. To call in the afternoon and expect an estimate that day is usually not going to happen (perhaps if I am already in their area I'll do it, but otherwise not). It is a very unreasonable expectation. They are usually open about the fact that they aren't about to spend a lot of money. Which they probably won't have to do if they can find someone to start their job that day. And they often act like they are doing us a huge favor by calling us. They act as if they are our first customer of the year.

It is obvious that such people are clueless as to how successful contracting companies operate. While we occasionally have a small hole in our schedule because a customer isn't ready, or we have weather issues, we usually stay booked for three to five weeks. And we certainly aren't the cheapest painting company in town.

There was a time when I would do flips to try to accommodate such people. But it became clear to me that they got a wild hair up their butt, and on a whim, decided to have some painting done. And since they are such compassionate people, they would put some low-life painter to work for a day and pay him $100. When I realized this, my attitude changed.

While I try to accommodate customers, their requests must also be reasonable. I need customers, but I don't need any one specific customer. And I certainly don't need unreasonable customers.

And speaking of unreasonable customers, I once had a call from a customer who was questioning my price. It's only a few ceilings, he said. Why so much money? I explained that he had a lot of furniture to protect, that we needed to cut in around the walls, and we had to make sure we didn't get any paint on the walls.

Don't worry about protecting the furniture, he told me. I don't care if you get paint on everything. I honestly didn't know whether to laugh or start looking for Rod Serling. I explained that a professional company wouldn't do such a thing. He argued for a few minutes, interlacing a few insults along the way, and then hung up after announcing that he would never hire my company.

Sometimes the best jobs are the ones we don't do.

Monday, January 5, 2009

Quick Roundup 2

The Power of Pausing
Good sales skills begin with good listening skills. Brian Tracy suggests pausing before you respond to your customers. Pausing has three benefits
The first is that you avoid the risk of interrupting the prospect if he or she has just stopped to gather his or her thoughts. Remember, your primary job in the sales conversation is to build and maintain a high level of trust, and listening builds trust.

The second benefit of pausing is that your silence tells the prospect that you are giving careful consideration to what he or she has just said. By carefully considering the other person's words, you are paying him or her a compliment.

The third benefit of pausing before replying is that you will actually hear and understand the prospect better if you give his or her words a few seconds to soak into your mind.

I've seen a lot of contractors (and other people as well) who are so eager to share what is on their mind that they completely ignore what the customer is saying. The customer will realize this, and it will greatly undermine their confidence in you. Communication is a two-way street. Do your part by listening carefully and being certain you understand what you are hearing.

Price vs. Service
Many companies are lowering prices in order to retain customers. Bill Hogg points out that Ambercrombie and Fitch aren't. They plan to retain their brand--which is not based on price. Many contractors are going to be tempted to cut their prices during this tough economic times. But what will they do when the market recovers and their customers expect the lower prices? A better strategy is to improve service, which might even permit you to increase prices. Don't view the economy as an obstacle; view it as an opportunity.

Make Their Phone Ring
John Jantsch suggest a simple, yet effective way to generate leads. Rather than sitting around waiting for the phone to ring, make your customer's phone ring--give them a call and thank them for their past business. Discuss ways you can help them now. Ask what you can do better. Most importantly, remind them you want their business.

Low-Cost Marketing Ideas
Maria Garcia offers seven low-cost marketing ideas, including writing articles and networking. If your advertising budget is feeling the pinch, some of these ideas will get the word out without breaking the bank.