It is often said that when you are in Rome, do as the Romans do. The point of this cliche is that you should adapt yourself to your surroundings. While there is an element of truth in this, for the most part it is poor advice, particularly when applied to a paint contracting business.
If we applied this advice to a contracting business, we would adopt the practices of our competitors. We would do things the same way as "everyone" else. We would do nothing to differentiate ourselves. And where would this get us? The same place as everyone else.
I don't mean to imply that we should never do anything the same as our competitors. What I mean is that simply because others are doing something doesn't mean that it is a good thing. As my mother used to say, "Just because everyone is jumping off of a bridge doesn't mean it is something that you should do."
The principle of "best practices" is a far better guideline. "Best practices" refers to those procedures and tactics that consistently lead to the desired results. For example, if you want to have a successful painting company, follow those procedures and tactics that are used by other successful painting companies.
There is nothing inherently wrong with doing as the Romans. But we must we careful which Romans we are emulating.
Showing posts with label business principles. Show all posts
Showing posts with label business principles. Show all posts
Monday, January 18, 2010
Tuesday, December 1, 2009
Good in Theory
We often hear someone say, “That is good in theory, but it won’t work in practice.” The intended meaning is that some idea sounds logical, but in the “real world” it just won’t work. But the fact is, a theory that won’t work in practice isn’t a very good theory. Good theories make good practice. Ideas are our guide to action.
Many people—and contractors are certainly no exception—are loath to try new ideas. They get locked into a certain mindset and often refuse to consider new alternatives. They may not like the results that they are getting, but the comfort of the known is more powerful than the unknown of trying new ideas. When they hear a new idea, they are quick to reject it as “good in theory”.
I see this almost everyday. One of the most common examples is the claim by some contractor that his market won’t bear higher prices. “You don’t understand my market,” they argue. “My customers simply don’t have the money to pay $40 an hour for painting services.”
Such contractors often concede that they must charge $40 (or more) an hour to make a decent wage, but they refuse to consider methods for doing so. On paper (in theory) they agree that they can’t make money charging $25 an hour, but in real life (in practice) they can’t charge more.
Consider what this really means: The facts indicate one thing, but I am going to ignore those facts. I choose to cling to my old ideas, even though I am going broke. All of your fancy math formulas won’t change anything. Your ideas are good in theory, but they won’t work in practice.
If we consider the rate we charge in complete isolation of other facts (or consider only a few other facts), this might be true. But our selling price is not an isolated fact, divorced from many other considerations. Our selling price is a consequence of many factors; the market in which we operate is only one of those factors.
As an example, we have many options when it comes to buying a hamburger. We have McDonald’s, Wendy’s, Burger King, Jack in the Box, and other fast food restaurants. We have upscale burger joints like Fuddrucker’s. We might have local establishments as well. Each prepares their food differently, uses different condiments, and might even bake their own buns. In other words, each tries to do something different to differentiate themselves. If they didn’t—if their burgers were exactly the same—the price they charge would become the only difference, and consumers would make their choice solely on price.
But the fact that they offer something different adds another element to our choice. When choosing where to get a hamburger, we have other considerations, such as the flavor of the meat or the sides offered or the condiments used or the entire dining experience. We are willing to pay more for a burger at Fuddrucker’s than a burger at McDonald’s. And we expect more in exchange.
The same principle holds true of painting contractors and the prices we charge. If the paint job we offer looks just like the job offered by our competitors, price does become the deciding factor. If our company looks just like everyone else, then price is most important.
Now, you might think that this sounds good in theory, but the fact remains that your market simply won’t bear higher prices. But how do you know? Do you believe this simply because that is what others have told you? Have you truly tried to differentiate your company? Have you tried to become the Fuddrucker’s or are you stuck in McDonald’s mode?
The truth is, if you regard the theory as good, then you must put it into practice. A good theory leads to good results.
Many people—and contractors are certainly no exception—are loath to try new ideas. They get locked into a certain mindset and often refuse to consider new alternatives. They may not like the results that they are getting, but the comfort of the known is more powerful than the unknown of trying new ideas. When they hear a new idea, they are quick to reject it as “good in theory”.
I see this almost everyday. One of the most common examples is the claim by some contractor that his market won’t bear higher prices. “You don’t understand my market,” they argue. “My customers simply don’t have the money to pay $40 an hour for painting services.”
Such contractors often concede that they must charge $40 (or more) an hour to make a decent wage, but they refuse to consider methods for doing so. On paper (in theory) they agree that they can’t make money charging $25 an hour, but in real life (in practice) they can’t charge more.
Consider what this really means: The facts indicate one thing, but I am going to ignore those facts. I choose to cling to my old ideas, even though I am going broke. All of your fancy math formulas won’t change anything. Your ideas are good in theory, but they won’t work in practice.
If we consider the rate we charge in complete isolation of other facts (or consider only a few other facts), this might be true. But our selling price is not an isolated fact, divorced from many other considerations. Our selling price is a consequence of many factors; the market in which we operate is only one of those factors.
As an example, we have many options when it comes to buying a hamburger. We have McDonald’s, Wendy’s, Burger King, Jack in the Box, and other fast food restaurants. We have upscale burger joints like Fuddrucker’s. We might have local establishments as well. Each prepares their food differently, uses different condiments, and might even bake their own buns. In other words, each tries to do something different to differentiate themselves. If they didn’t—if their burgers were exactly the same—the price they charge would become the only difference, and consumers would make their choice solely on price.
But the fact that they offer something different adds another element to our choice. When choosing where to get a hamburger, we have other considerations, such as the flavor of the meat or the sides offered or the condiments used or the entire dining experience. We are willing to pay more for a burger at Fuddrucker’s than a burger at McDonald’s. And we expect more in exchange.
The same principle holds true of painting contractors and the prices we charge. If the paint job we offer looks just like the job offered by our competitors, price does become the deciding factor. If our company looks just like everyone else, then price is most important.
Now, you might think that this sounds good in theory, but the fact remains that your market simply won’t bear higher prices. But how do you know? Do you believe this simply because that is what others have told you? Have you truly tried to differentiate your company? Have you tried to become the Fuddrucker’s or are you stuck in McDonald’s mode?
The truth is, if you regard the theory as good, then you must put it into practice. A good theory leads to good results.
Monday, August 31, 2009
Learning by Spiraling
Learning seldom occurs in a linear line. For example, when we read a book, we might grasp the main points and a few of the minor points. But it is almost impossible to get every point in the book—it is too much to absorb at one time.
Spiraling involves re-visiting old ideas for the purpose of picking up nuances missed the first time. When we spiral we bring an expanded context of knowledge to the topic. We have integrated and applied certain information, and when we re-visit the topic we are able to see deeper meaning and wider application than we could before.
Even before I learned about spiraling, I often had the following experience: I would read something and think, “I get this.” Later, when I revisited the point, I would grasp it even better, and think, “Now I really get it.” And later still, I would see new applications and think, “Now I really, really understand.” The interesting thing is, no matter how many times I come back to these issues, it seems as if there is still something that alluded me before.
So dust off those old books and dive back in. You might be surprised what you learn.
Spiraling involves re-visiting old ideas for the purpose of picking up nuances missed the first time. When we spiral we bring an expanded context of knowledge to the topic. We have integrated and applied certain information, and when we re-visit the topic we are able to see deeper meaning and wider application than we could before.
Even before I learned about spiraling, I often had the following experience: I would read something and think, “I get this.” Later, when I revisited the point, I would grasp it even better, and think, “Now I really get it.” And later still, I would see new applications and think, “Now I really, really understand.” The interesting thing is, no matter how many times I come back to these issues, it seems as if there is still something that alluded me before.
So dust off those old books and dive back in. You might be surprised what you learn.
Monday, July 27, 2009
Zappos
I recently read about Zappos on Zig Ziglar’s blog. At first I thought this was a joke, as the company sells shoes online. The idea struck me as bizarre—I couldn’t imagine anyone buying a pair of shoes without first trying them on. But they must be doing something right, as Amazon.com recently bought Zappos for about $928 million.
From what I have read, a large part of the success of Zappos is attributed to the company being a fun place to work. Indeed, one of their “ten commandments” is “Create fun and a little weirdness”. This may seem like an odd directive, but employees embrace the atmosphere that exists at Zappos. And that is reflected in their customer service. For example, if a customer mentions having a bad day, she might find flowers on her doorstep the next morning.
Such offbeat tactics might seem silly, but they have created a growing legion of loyal customers. And that is always a good thing. Sometimes all it takes is a little imagination.
From what I have read, a large part of the success of Zappos is attributed to the company being a fun place to work. Indeed, one of their “ten commandments” is “Create fun and a little weirdness”. This may seem like an odd directive, but employees embrace the atmosphere that exists at Zappos. And that is reflected in their customer service. For example, if a customer mentions having a bad day, she might find flowers on her doorstep the next morning.
Such offbeat tactics might seem silly, but they have created a growing legion of loyal customers. And that is always a good thing. Sometimes all it takes is a little imagination.
Saturday, July 11, 2009
Lessons from Child Rearing
Even though I don’t have children, I find the topic of child-rearing interesting. Getting Things Done—a personal productivity site—recently had an interesting post involving children. The author was going to spend the day with his children, and involved them in planning the day.
They began by listing some of the activities they wanted to do. They then identified how long each activity would take—there is no sense in trying to cram 10 pounds of potatoes into a 5 pound sack. I won’t relate the entire story, but it turned out to be a fun day for everyone.
The lesson in the story is directly applicable to small business owners. Often, we simply dictate to our employees how things will be. After all, we are the boss and if they don’t like it… But this often gets us results different from what we want and expect. We don’t get “buy in”.
Like the parent who involved his children in planning the day, we should involve our employees in the decision making process. This doesn’t mean that we give in to whatever ideas they come up with, but it does mean that we give their ideas serious consideration. Not only are they more likely to approve of the results, and therefore implement them, there is a good chance that they will have some better ideas.
I certainly don’t mean to equate children and employees, but in a certain sense there is a similarity. In both relationships, we have the final authority. In both relationships, we are looked upon as the expert and the guiding force. We are the leader. While this requires a firm hand, it does not mean that we should be dictators.
I am familiar with parents who tell their children to do something “because I said so”. This hardly helps the child understand the rationale behind the directive. However, when the parent explains his reasons (in a manner the child can understand), the results can be much more satisfactory to all involved. The same applies to our employees.
They began by listing some of the activities they wanted to do. They then identified how long each activity would take—there is no sense in trying to cram 10 pounds of potatoes into a 5 pound sack. I won’t relate the entire story, but it turned out to be a fun day for everyone.
The lesson in the story is directly applicable to small business owners. Often, we simply dictate to our employees how things will be. After all, we are the boss and if they don’t like it… But this often gets us results different from what we want and expect. We don’t get “buy in”.
Like the parent who involved his children in planning the day, we should involve our employees in the decision making process. This doesn’t mean that we give in to whatever ideas they come up with, but it does mean that we give their ideas serious consideration. Not only are they more likely to approve of the results, and therefore implement them, there is a good chance that they will have some better ideas.
I certainly don’t mean to equate children and employees, but in a certain sense there is a similarity. In both relationships, we have the final authority. In both relationships, we are looked upon as the expert and the guiding force. We are the leader. While this requires a firm hand, it does not mean that we should be dictators.
I am familiar with parents who tell their children to do something “because I said so”. This hardly helps the child understand the rationale behind the directive. However, when the parent explains his reasons (in a manner the child can understand), the results can be much more satisfactory to all involved. The same applies to our employees.
Monday, June 29, 2009
That’s Too Much Trouble
A recent post on Michael Stone’s blog raises an interesting point—many contractors seem to have plenty of time to complain, but no time to fix or prevent the object of their complaints. He tells the story of a contractor who was receiving complaints that his employees were damaging things they didn’t work on. Michael suggesting taking pictures prior to starting work. The contractor declared that that would be too much trouble.
Apparently, dealing with customer complaints wasn’t too much trouble. Apparently, upsetting customers is preferable to avoiding the complaints. Apparently, an ounce of prevention isn’t worth a pound of cure (in this contractor’s opinion).
Years ago we noticed that we seemed to get the same types of complaints over and over. It wasn’t that we had tons of complaints, just that the one we got were similar. I sat down with my supervisors and we made a list of the common complaints and what caused them. We discovered, like the contractor above, that most of these were pre-existing conditions. But we were getting blamed for them!
So we put together procedures to identify these items before starting any work, and we then brought them to the customer’s attention. Not surprisingly, most of the time the customer was unaware of these issues. But when inspecting their fresh paint job, they would have seen these issues and assumed we were responsible. Suddenly the complaints virtually stopped. And we often were able to sell additional work to correct the problem.
The little extra time we spent addressing these problems has saved us countless hours over the years, avoided upsetting customers, and perhaps best of all, helped us increase our sales.
Apparently, dealing with customer complaints wasn’t too much trouble. Apparently, upsetting customers is preferable to avoiding the complaints. Apparently, an ounce of prevention isn’t worth a pound of cure (in this contractor’s opinion).
Years ago we noticed that we seemed to get the same types of complaints over and over. It wasn’t that we had tons of complaints, just that the one we got were similar. I sat down with my supervisors and we made a list of the common complaints and what caused them. We discovered, like the contractor above, that most of these were pre-existing conditions. But we were getting blamed for them!
So we put together procedures to identify these items before starting any work, and we then brought them to the customer’s attention. Not surprisingly, most of the time the customer was unaware of these issues. But when inspecting their fresh paint job, they would have seen these issues and assumed we were responsible. Suddenly the complaints virtually stopped. And we often were able to sell additional work to correct the problem.
The little extra time we spent addressing these problems has saved us countless hours over the years, avoided upsetting customers, and perhaps best of all, helped us increase our sales.
Wednesday, June 17, 2009
Principles and Plagiarism
My contracting company has had a web site for nearly 14 years—we were one of the first painting contractors with a web presence. This, along with my writing skills, has made the content of my site a target for pirates.
Over the years, a remarkable number of individuals have decided that they would use content from my site. With only a handful of exceptions, this was done without my knowledge or permission. In other words, they stole from me.
What I find particularly interesting in many of these cases is the particular content these pirates choose. For example, one decided to copy my entire site, substituting the name of his company in the appropriate places. He even used quotes from my employees talking about an organization he did not belong to.
Included in his plagiarism was the use of my tag line, “Painters with Principles”. This was both amusing and infuriating. The infuriating part was his blatant disregard for the intellectual property rights of others. The amusing part was his hypocritical claim of being principled.
To be principled means to be guided by a specific set of rules of conduct. It means that one acts in a certain manner consistently and without exception, that one does not make exceptions when it is “convenient” or expedient. Principles provide us with the tools to choose our values and the means for attaining them.
You may think that this is ivory-tower BS that has nothing to do with paint contracting. You would be horribly wrong.
Consider just a few of the choices you might face in a day:
1. You meet with a customer to inspect a job and promise an estimate on a particular day. Do you honor your commitment, or ignore it because you conclude that the customer is cheap and won’t pay your price?
2. You discover some rotted wood that wasn’t included in your estimate. Do you tell the customer and supply a price, or do you slap some caulk on it?
3. A customer asks if you like the color she selected. Do you give your opinion, and simply tell her that it will look great?
Your answer to each of these—and the myriad other choices you face in a day—are ultimately determined by your principles, or lack thereof. And your choices will ultimately determine the results that you get. Your choices will ultimately determine if you are successful or a failure.
Those who think that they can steal my words are certainly cheating me. They will come up with all kinds of excuses to rationalize their behavior—“I’m not hurting anyone”, “it’s just words”, “everybody does it”, etc. But what they don’t realize is that they are the primary victim of their dishonesty. They can lie to their customers (which they are doing by plagiarizing), they can lie to their wives, they can lie to the world, but they cannot lie to themselves. They know, whether they choose to admit it or not, that they are scoundrels.
There was a time when I would simmer over such actions. I no longer do so. Instead, I remind myself that such people are living the miserable lives that they deserve. And I let my lawyer make their lives a little more miserable.
Over the years, a remarkable number of individuals have decided that they would use content from my site. With only a handful of exceptions, this was done without my knowledge or permission. In other words, they stole from me.
What I find particularly interesting in many of these cases is the particular content these pirates choose. For example, one decided to copy my entire site, substituting the name of his company in the appropriate places. He even used quotes from my employees talking about an organization he did not belong to.
Included in his plagiarism was the use of my tag line, “Painters with Principles”. This was both amusing and infuriating. The infuriating part was his blatant disregard for the intellectual property rights of others. The amusing part was his hypocritical claim of being principled.
To be principled means to be guided by a specific set of rules of conduct. It means that one acts in a certain manner consistently and without exception, that one does not make exceptions when it is “convenient” or expedient. Principles provide us with the tools to choose our values and the means for attaining them.
You may think that this is ivory-tower BS that has nothing to do with paint contracting. You would be horribly wrong.
Consider just a few of the choices you might face in a day:
1. You meet with a customer to inspect a job and promise an estimate on a particular day. Do you honor your commitment, or ignore it because you conclude that the customer is cheap and won’t pay your price?
2. You discover some rotted wood that wasn’t included in your estimate. Do you tell the customer and supply a price, or do you slap some caulk on it?
3. A customer asks if you like the color she selected. Do you give your opinion, and simply tell her that it will look great?
Your answer to each of these—and the myriad other choices you face in a day—are ultimately determined by your principles, or lack thereof. And your choices will ultimately determine the results that you get. Your choices will ultimately determine if you are successful or a failure.
Those who think that they can steal my words are certainly cheating me. They will come up with all kinds of excuses to rationalize their behavior—“I’m not hurting anyone”, “it’s just words”, “everybody does it”, etc. But what they don’t realize is that they are the primary victim of their dishonesty. They can lie to their customers (which they are doing by plagiarizing), they can lie to their wives, they can lie to the world, but they cannot lie to themselves. They know, whether they choose to admit it or not, that they are scoundrels.
There was a time when I would simmer over such actions. I no longer do so. Instead, I remind myself that such people are living the miserable lives that they deserve. And I let my lawyer make their lives a little more miserable.
Wednesday, June 10, 2009
Painting Estimates and Real Estate
I have recently begun to look at real estate investing. With the number of foreclosures in the market, and depressed prices, this is a good time to get into the market.
We spent several months educating ourselves before we began to seriously look at properties. Now that we are doing so, I see a lot of similarities between estimating painting jobs and purchasing real estate.
In both cases, you must know your numbers. I can analyze a property without leaving my desk. If the numbers work, then we go look at it to verify assumptions and put our eyes on it. But knowing the numbers is key--if the numbers work it is a good deal. If the numbers don't work, I would be wasting my time.
This is no different from painting. If you know your numbers, you can easily identify what price you must charge on any particular job. If you don't know your numbers, you are wasting your time, and maybe burning money.
Estimating/ sales is a numbers game. We aren't going to get every job, but if we have enough leads and land a reasonable number, we will be profitable. The same is true in real estate--we have already submitted two offers and are looking for more to bid on. We won't get them all, but if we make solid offers our real estate gig will do well.
I've heard many contractors say that our profession makes us naturals to get into real estate. I think there is some truth in that. But I think what really prepares us is knowing our numbers.
We spent several months educating ourselves before we began to seriously look at properties. Now that we are doing so, I see a lot of similarities between estimating painting jobs and purchasing real estate.
In both cases, you must know your numbers. I can analyze a property without leaving my desk. If the numbers work, then we go look at it to verify assumptions and put our eyes on it. But knowing the numbers is key--if the numbers work it is a good deal. If the numbers don't work, I would be wasting my time.
This is no different from painting. If you know your numbers, you can easily identify what price you must charge on any particular job. If you don't know your numbers, you are wasting your time, and maybe burning money.
Estimating/ sales is a numbers game. We aren't going to get every job, but if we have enough leads and land a reasonable number, we will be profitable. The same is true in real estate--we have already submitted two offers and are looking for more to bid on. We won't get them all, but if we make solid offers our real estate gig will do well.
I've heard many contractors say that our profession makes us naturals to get into real estate. I think there is some truth in that. But I think what really prepares us is knowing our numbers.
Thursday, June 4, 2009
Twisting Like a Pretzel
A recent thread on a painting forum raised the issue of working on Sunday. I opposed the idea, stating that I desire to have a life and I’m not willing to turn into a pretzel to please my customers.
One responder stated his desire to be flexible and show the customer that he “will be there for the customer”. I emphatically disagree with this position. Not only does it convey the wrong idea to the customer, it also sets the contractor up for a nightmare.
I doubt that the poster literally meant that he would do anything to please the customer. So where does he draw the line? Apparently he is willing to give up his weekends and evenings. What else is he willing to give up? If he is willing to meet customers at 7 p.m., why not 8 p.m., or 9 p.m.? If he is willing to be there for them at 7, why not be there for them at 9 or any other time they choose?
Some may say that my questions are silly, that we have to draw the line somewhere. I agree that we must draw a line. I simply disagree where the line should be drawn, and who should draw it.
While I believe that we should exhibit some flexibility in dealing with customers, it should be on our terms. We should establish the type of business we want to own, and then operate on that standard. I choose to have a life in addition to my business. I do not want my business dominating my life and preventing me from enjoying other activities.
I will admit that there was a time I would do almost anything a customer requested. And I was miserable. My life was being dictated by the desires of others. And when I finally realized this and established set work hours, a funny thing happened—customers were generally accommodating. We occasionally lose a lead, but it is rather infrequent. Just as customers find a way to accommodate the cable guy, or the phone company, or a multitude of other service providers, they can find a way to accommodate the painting contractor.
One responder stated his desire to be flexible and show the customer that he “will be there for the customer”. I emphatically disagree with this position. Not only does it convey the wrong idea to the customer, it also sets the contractor up for a nightmare.
I doubt that the poster literally meant that he would do anything to please the customer. So where does he draw the line? Apparently he is willing to give up his weekends and evenings. What else is he willing to give up? If he is willing to meet customers at 7 p.m., why not 8 p.m., or 9 p.m.? If he is willing to be there for them at 7, why not be there for them at 9 or any other time they choose?
Some may say that my questions are silly, that we have to draw the line somewhere. I agree that we must draw a line. I simply disagree where the line should be drawn, and who should draw it.
While I believe that we should exhibit some flexibility in dealing with customers, it should be on our terms. We should establish the type of business we want to own, and then operate on that standard. I choose to have a life in addition to my business. I do not want my business dominating my life and preventing me from enjoying other activities.
I will admit that there was a time I would do almost anything a customer requested. And I was miserable. My life was being dictated by the desires of others. And when I finally realized this and established set work hours, a funny thing happened—customers were generally accommodating. We occasionally lose a lead, but it is rather infrequent. Just as customers find a way to accommodate the cable guy, or the phone company, or a multitude of other service providers, they can find a way to accommodate the painting contractor.
Tuesday, May 26, 2009
Kissing Butt to Get the Sale
Some time ago I read an interesting thread on a forum that shall remain nameless. Contractors were discussing various tactics for getting the sale, including “kissing butt”. One commented that he would do whatever it takes to land the job.
On the surface this might sound like a reasonable approach. Certainly we must take into consideration the customer’s needs, concerns, and values. But to mix metaphors, “kissing butt” is not skin deep.
I will let you imagine the literal meaning of the phrase. In practice it isn’t a pretty sight. In principle, it isn’t any better.
I compared this tactic to that of a prostitute—doing “whatever it takes” means just that. You will do anything the customer requests, no matter how unreasonable. (I seriously doubt that the poster meant this, but I take words for their actual meaning.) A prostitute will debase herself simply to get the job—in fact, debasement is her job.
A painting contractor who adopts this tactic becomes nothing more than a patsy. He allows the customer to dictate the terms of their relationship. His constant appeasement makes him a docile pawn, manipulated into satisfying whatever whim happens to strike the customer. And the more he does, the more he reinforces the customer’s power lust.
This is not to say that we should be bullies and give the customer a “take it or leave it” proposition. It does mean that we must seek a relationship that is mutually beneficial, not just in the short term, but also in the long term.
“Kissing butt” focuses on the short term. The contractor’s concern is on the immediate moment—landing this job now. In the process, he undermines his long term success. We need customers, but not any one particular customer. We need paint jobs, but we do not need any one particular job. In short, don’t kiss butt to get a job. You will wind up with something much nastier than egg on your face.
On the surface this might sound like a reasonable approach. Certainly we must take into consideration the customer’s needs, concerns, and values. But to mix metaphors, “kissing butt” is not skin deep.
I will let you imagine the literal meaning of the phrase. In practice it isn’t a pretty sight. In principle, it isn’t any better.
I compared this tactic to that of a prostitute—doing “whatever it takes” means just that. You will do anything the customer requests, no matter how unreasonable. (I seriously doubt that the poster meant this, but I take words for their actual meaning.) A prostitute will debase herself simply to get the job—in fact, debasement is her job.
A painting contractor who adopts this tactic becomes nothing more than a patsy. He allows the customer to dictate the terms of their relationship. His constant appeasement makes him a docile pawn, manipulated into satisfying whatever whim happens to strike the customer. And the more he does, the more he reinforces the customer’s power lust.
This is not to say that we should be bullies and give the customer a “take it or leave it” proposition. It does mean that we must seek a relationship that is mutually beneficial, not just in the short term, but also in the long term.
“Kissing butt” focuses on the short term. The contractor’s concern is on the immediate moment—landing this job now. In the process, he undermines his long term success. We need customers, but not any one particular customer. We need paint jobs, but we do not need any one particular job. In short, don’t kiss butt to get a job. You will wind up with something much nastier than egg on your face.
Friday, April 17, 2009
Re-Inventing the Wheel
I have been thinking of investing in rental real estate, and I recently posted on a contractor forum seeking input from anyone who has previously done so. The response was quite interesting.
I was quickly told about the problems I would face, such as tenants who don’t pay, destroy the property, or both. I pointed out that with the proper systems in place, such problems could largely be avoided. But this did not dissuade the critics.
I was struck by how similar this is to other things I frequently hear from painting contractors: door hangers don’t work, yellow pages don’t work, customers are cheap, nobody appreciates quality, illegals are stealing all of the work, yada, yada, yada. I call these people the nay-sayers.
And then this morning I received the following Thought of the Day from the Napoleon Hill Foundation:
Certainly there are challenges in rental real estate, just as there are challenges in contracting. So? If it were easy, everyone would do it. The challenges aren’t the issue here—how we deal with those challenges is.
The nay-sayers continue to insist that painting contractors can’t make money, despite an abundance of evidence to the contrary. They see each obstacle as an impenetrable wall that halts any progress. And when someone points out evidence that contradicts their conclusions, they respond with more excuses: that may be true in large cities but not in rural areas, I don’t want to be a high pressure salesman, I won’t compromise on my quality, yada, yada, yada.
Whether it is real estate or contracting, the nay-sayers are determined to stick to their conclusions, come hell or high water. Their situation or market is completely unique, and sound business principles simply do not apply. This of course, is simply not true.
Whether they realize it or not, the nay-sayers are making an admission: they lack the skills, ambition, perseverance, or some other characteristic necessary to overcome the challenges. The crucial fact that the nay-sayers overlook is that, in most situations, others have already overcome the challenges.
A wise man learns from his mistakes. A really smart man learns from the mistakes of others. In other words, don’t try to re-invent the wheel. Learn from those who have accomplished the goals you seek. Find a mentor and listen to his advice.
This does not mean blind obedience. You must judge for yourself the prudence of each idea. But it can be a huge waste of time, money, and energy to try to discover each idea on your own. This applies to real estate, and it applies to paint contracting.
I was quickly told about the problems I would face, such as tenants who don’t pay, destroy the property, or both. I pointed out that with the proper systems in place, such problems could largely be avoided. But this did not dissuade the critics.
I was struck by how similar this is to other things I frequently hear from painting contractors: door hangers don’t work, yellow pages don’t work, customers are cheap, nobody appreciates quality, illegals are stealing all of the work, yada, yada, yada. I call these people the nay-sayers.
And then this morning I received the following Thought of the Day from the Napoleon Hill Foundation:
A POSITIVE MIND FINDS A WAY IT CAN BE DONE. A NEGATIVE MIND LOOKS FOR ALL THE WAYS IT CAN’T BE DONE.
Certainly there are challenges in rental real estate, just as there are challenges in contracting. So? If it were easy, everyone would do it. The challenges aren’t the issue here—how we deal with those challenges is.
The nay-sayers continue to insist that painting contractors can’t make money, despite an abundance of evidence to the contrary. They see each obstacle as an impenetrable wall that halts any progress. And when someone points out evidence that contradicts their conclusions, they respond with more excuses: that may be true in large cities but not in rural areas, I don’t want to be a high pressure salesman, I won’t compromise on my quality, yada, yada, yada.
Whether it is real estate or contracting, the nay-sayers are determined to stick to their conclusions, come hell or high water. Their situation or market is completely unique, and sound business principles simply do not apply. This of course, is simply not true.
Whether they realize it or not, the nay-sayers are making an admission: they lack the skills, ambition, perseverance, or some other characteristic necessary to overcome the challenges. The crucial fact that the nay-sayers overlook is that, in most situations, others have already overcome the challenges.
A wise man learns from his mistakes. A really smart man learns from the mistakes of others. In other words, don’t try to re-invent the wheel. Learn from those who have accomplished the goals you seek. Find a mentor and listen to his advice.
This does not mean blind obedience. You must judge for yourself the prudence of each idea. But it can be a huge waste of time, money, and energy to try to discover each idea on your own. This applies to real estate, and it applies to paint contracting.
Friday, March 27, 2009
Tightening the Belt
Tough times call for tough decisions, and cutting overhead can be one of the toughest decisions. Operating a business requires certain overhead costs, such as phones, equipment maintenance, advertising, and insurance. If we eliminate, or greatly reduce some of these expenses, we make it increasingly difficult to stay in business.
This can seem like a horrible Catch-22 situation. If we cut these costs, we take significant business risks. If we don’t cut these costs, we risk facing severe cash flow problems. What is a contractor to do?
Now, more than ever, knowing your numbers is crucial. Understanding your cost structure and selling at the right price—that is, a price that is profitable—is the first step. If you aren’t doing these things, almost nothing else matters.
There is no simple answer to this dilemma. Each contractor must assess his particular situation in the context of his business and goals. But it is important to keep long term goals in mind when doing so. For example, saving a few dollars today on advertising may be disastrous in the long term.
The recession isn’t limited to contractor—other businesses are also slowing down. This can be an opportunity to negotiate better rates on advertising, phone service, and other overhead items. As an example, we recently switched our phone service at a savings of more than $150 per month.
If you find yourself needing to trim your overhead, examine your financial statements closely—year to year comparisons can be particularly helpful. They can show where expenses have risen most significantly. Compute the ratio of each expense to revenues—raw numbers are not always helpful when revenues fluctuate. Most of all, develop a plan for dealing with your particular financial situation.
This can seem like a horrible Catch-22 situation. If we cut these costs, we take significant business risks. If we don’t cut these costs, we risk facing severe cash flow problems. What is a contractor to do?
Now, more than ever, knowing your numbers is crucial. Understanding your cost structure and selling at the right price—that is, a price that is profitable—is the first step. If you aren’t doing these things, almost nothing else matters.
There is no simple answer to this dilemma. Each contractor must assess his particular situation in the context of his business and goals. But it is important to keep long term goals in mind when doing so. For example, saving a few dollars today on advertising may be disastrous in the long term.
The recession isn’t limited to contractor—other businesses are also slowing down. This can be an opportunity to negotiate better rates on advertising, phone service, and other overhead items. As an example, we recently switched our phone service at a savings of more than $150 per month.
If you find yourself needing to trim your overhead, examine your financial statements closely—year to year comparisons can be particularly helpful. They can show where expenses have risen most significantly. Compute the ratio of each expense to revenues—raw numbers are not always helpful when revenues fluctuate. Most of all, develop a plan for dealing with your particular financial situation.
Tuesday, March 17, 2009
Cash and Spending
If you pay much attention to the media, you will quickly "learn" that many of our economic problems are being caused by consumers spending less. Less consumer spending, the argument goes, means less demand for goods and services. According to this thinking, stimulating spending--in either the private or public spending--will get the economy rolling again. In other words, we need more spending. However, even though the federal government is pumping trillions of dollars into the economy, much of the money is being used to improve balance sheets--that is, saved.
There are several errors in thinking that consumer spending drives the economy. First, it simply isn't true. Say's Law states that supply creates demand. An increase in production results in an increase in demand. Or to put it differently, consumption cannot occur without production.
Another error is that savings are spent. If you put $100 in the bank, that money is subsequently loaned to businesses or individuals. They then spend the money, either on expanding production (in the case of business) or for consumption (in the case of individuals).
As owners of small businesses, we will certainly feel the pinch during this recession. Consumers are spending less, which will translate to fewer leads and less work. If we listen to many of the "experts" we should not be saving money or paying off debt--we should be spending so as to stimulate the economy. But this could be extremely foolish, and ultimately destructive to many individuals.
It is always wise to spend less than you make, to save and invest. That doesn't change when the economy slows.
There are several errors in thinking that consumer spending drives the economy. First, it simply isn't true. Say's Law states that supply creates demand. An increase in production results in an increase in demand. Or to put it differently, consumption cannot occur without production.
Another error is that savings are spent. If you put $100 in the bank, that money is subsequently loaned to businesses or individuals. They then spend the money, either on expanding production (in the case of business) or for consumption (in the case of individuals).
As owners of small businesses, we will certainly feel the pinch during this recession. Consumers are spending less, which will translate to fewer leads and less work. If we listen to many of the "experts" we should not be saving money or paying off debt--we should be spending so as to stimulate the economy. But this could be extremely foolish, and ultimately destructive to many individuals.
It is always wise to spend less than you make, to save and invest. That doesn't change when the economy slows.
Friday, December 19, 2008
Quick Roundup
Clarify Your Goals
The clarity of your goals will ultimately have a large impact on your ability to achieve those goals. Vague goals only lead to confusion, and often send us in the wrong direction. For example, a goal to spend more time with your family in 2009 is much different from a goal to achieve the financial position to be able to spend more time with your family. On the surface, they may seem the same, but the latter specifies the more fundamental goal. In other words, achieving a certain financial position makes more free time possible.
Brian Tracy addresses this in The Law of Clarity:
No matter our goal, we must identify the cause and the effect. And we must focus in on the real effect we want. That will often help us identify and clarify the specific steps we must take to achieve that goal.
What Was That Bump?
In working with other contractors I am often struck by how resistant they are to try a new idea. They seem overwhelmed by the potential for making a mistake or failing, and this fear stops them from attempting something new. For example, many contractors are extremely reluctant to raise their prices.
Certainly, nobody enjoys making a mistake or failing. But it is a part of life and business. As Dan Miller writes in Go Ahead--Make More Mistakes:
An essential part of entrepreneurism is taking calculated risks. Doing what you've always done will continue to get you the same results. Getting different--better--results means doing something different, and that necessarily involves the risk of making a mistake or failing. Taking calculated risks won't eliminate mistakes, but it often reduces them to minor bumps.
Five Essential Skills
Michael Gerber's new book, The Power Point, lists 5 essential skills that every entrepreneur must possess. Mastering these skills, he says, is necessary to create a great business. The skills are:
Not only do these skills help us achieve our goals, they also help us clarify those goals and develop a plan that will minimize the risks involved.
The Two-Minute Rule
One of the biggest obstacles to achieving our goals is procrastination. While there are many causes of procrastination, they all result in delaying work on some task or project. We may write the task down, or swear that we will remember it, or whatever. But we delay doing it, and suddenly we can have a very long list of tasks. David Allen, of Getting Things Done, developed the Two-Minute Rule--if a task will take less than 2 minutes to complete, do it now. Here is a short video--it is only 2 minutes long--on how to apply the Two-Minute Rule.
The clarity of your goals will ultimately have a large impact on your ability to achieve those goals. Vague goals only lead to confusion, and often send us in the wrong direction. For example, a goal to spend more time with your family in 2009 is much different from a goal to achieve the financial position to be able to spend more time with your family. On the surface, they may seem the same, but the latter specifies the more fundamental goal. In other words, achieving a certain financial position makes more free time possible.
Brian Tracy addresses this in The Law of Clarity:
People with clear, written goals, accomplish far more in a shorter period of time than people without them could ever imagine. This is true everywhere and under all circumstances.
No matter our goal, we must identify the cause and the effect. And we must focus in on the real effect we want. That will often help us identify and clarify the specific steps we must take to achieve that goal.
What Was That Bump?
In working with other contractors I am often struck by how resistant they are to try a new idea. They seem overwhelmed by the potential for making a mistake or failing, and this fear stops them from attempting something new. For example, many contractors are extremely reluctant to raise their prices.
Certainly, nobody enjoys making a mistake or failing. But it is a part of life and business. As Dan Miller writes in Go Ahead--Make More Mistakes:
Here’s what Robert Kiyosaki (Rich Dad Poor Dad) has to say about “bad luck.” He says, “Making mistakes and becoming smarter is the job of an entrepreneur; not making mistakes is the job of an employee.”
An essential part of entrepreneurism is taking calculated risks. Doing what you've always done will continue to get you the same results. Getting different--better--results means doing something different, and that necessarily involves the risk of making a mistake or failing. Taking calculated risks won't eliminate mistakes, but it often reduces them to minor bumps.
Five Essential Skills
Michael Gerber's new book, The Power Point, lists 5 essential skills that every entrepreneur must possess. Mastering these skills, he says, is necessary to create a great business. The skills are:
- Concentration--The inner force and energy that allows you to focus your attention.
- Discrimination--The ability to choose upon what, where and who our attention (or concentration) is directed.
- Organization--This is the ability to turn chaos into order.
- Innovation--Innovation is that spark of genius that all entrepreneurs have and should be seen as an asset.
- Communication--The ability to transmit ideas with clarity, precision, passion and purpose.
Not only do these skills help us achieve our goals, they also help us clarify those goals and develop a plan that will minimize the risks involved.
The Two-Minute Rule
One of the biggest obstacles to achieving our goals is procrastination. While there are many causes of procrastination, they all result in delaying work on some task or project. We may write the task down, or swear that we will remember it, or whatever. But we delay doing it, and suddenly we can have a very long list of tasks. David Allen, of Getting Things Done, developed the Two-Minute Rule--if a task will take less than 2 minutes to complete, do it now. Here is a short video--it is only 2 minutes long--on how to apply the Two-Minute Rule.
Saturday, November 22, 2008
The Winter of ‘08
This coming winter looks like it will be a rough time for painting contractors. Economic turmoil and the uncertainty of a new President have clients holding tightly to their money. Painting work will likely be tough to come by for many contractors.
I have regularly written, on this blog and elsewhere, of several crucial components to success in the contracting business. Those ideas remain true even in an economic slow down. Those ideas are:
1. Market constantly
2. Develop systems (including marketing systems)
3. Manage cash flow
4. Sell at the right price
In a recession contractors are going to be very tempted to cut prices. This temptation will be even greater if leads are not regular and consistent. Thus the need for constant marketing. If you are not getting sufficient leads and cut prices as a result, you will suffer other consequences. Cash flow will diminish—lower prices means less cash. You will have difficulty raising prices later—you will have a reputation as a cheap painter. Insufficient leads is a symptom. Do not treat it by cutting prices. Treat it by dealing with the disease—lack of marketing.
Systems are crucial to efficient operations and consistent results. Efficiency and consistently have side benefits, such as fewer crises, more free time, and reduced stress. Reducing stress will be important during a recession. Reduced leads and tighter budgets are going to potentially stress even the most successful contractors. Anything you can do to reduce stress—and developing systems is one of the most effective ways—will be beneficial.
Cash flow management is always important. It is more so during tight economic times. Eliminating debt frees up money, reduces expenses, and allows you to build a cushion. Cutting prices will not improve cash flow.
Selling at the right price is never more important than during tough times. During good times jobs can fall into our laps. Often, if we simply show up and offer a fair price the job is ours. But things change during tight times. Customers hold onto their money and spend more time shopping for value. Don’t think that tough times will turn all customers into price shoppers—it won’t. But they will be more cognizant of value, and it is your job to offer and communicate the value you offer.
Tough economic times are a challenge and an opportunity. It is up to each of us whether we allow the challenge to beat us down, or we rise to the occasion and take advantage of the situation.
I have regularly written, on this blog and elsewhere, of several crucial components to success in the contracting business. Those ideas remain true even in an economic slow down. Those ideas are:
1. Market constantly
2. Develop systems (including marketing systems)
3. Manage cash flow
4. Sell at the right price
In a recession contractors are going to be very tempted to cut prices. This temptation will be even greater if leads are not regular and consistent. Thus the need for constant marketing. If you are not getting sufficient leads and cut prices as a result, you will suffer other consequences. Cash flow will diminish—lower prices means less cash. You will have difficulty raising prices later—you will have a reputation as a cheap painter. Insufficient leads is a symptom. Do not treat it by cutting prices. Treat it by dealing with the disease—lack of marketing.
Systems are crucial to efficient operations and consistent results. Efficiency and consistently have side benefits, such as fewer crises, more free time, and reduced stress. Reducing stress will be important during a recession. Reduced leads and tighter budgets are going to potentially stress even the most successful contractors. Anything you can do to reduce stress—and developing systems is one of the most effective ways—will be beneficial.
Cash flow management is always important. It is more so during tight economic times. Eliminating debt frees up money, reduces expenses, and allows you to build a cushion. Cutting prices will not improve cash flow.
Selling at the right price is never more important than during tough times. During good times jobs can fall into our laps. Often, if we simply show up and offer a fair price the job is ours. But things change during tight times. Customers hold onto their money and spend more time shopping for value. Don’t think that tough times will turn all customers into price shoppers—it won’t. But they will be more cognizant of value, and it is your job to offer and communicate the value you offer.
Tough economic times are a challenge and an opportunity. It is up to each of us whether we allow the challenge to beat us down, or we rise to the occasion and take advantage of the situation.
Friday, November 14, 2008
Penny Wise and Pound Foolish
You have probably heard the phrase "penny wise and pound foolish". The phrase generally is applied to someone who pinches pennies and then turns around and spend exorbitantly. More essentially it means that someone is fretting over small details while ignoring the bigger picture.
I witnessed a humorous (at least it was humorous to me) example of this during a meeting with a general contractor. He was presenting several painting contractors with a very large project involving a national fast food company. He was giving us some general information about the project, which was going to occur in cities across the South. At one point he mentioned that we would be using Sherwin Williams' products, so we would not have problems getting the same products.
One of the contractors started asking which specific products we would be using. He wanted to know if we'd be using SuperPaint or ProMar, whether the walls would be flat or satin, etc. Mind you, this project was still in the planning phases and no products had actually been specified yet. The issue was not the product, but how we would organize production and insure quality control. The product was an irrelevant detail.
I recently read a similar story on Denise Landers' blog.
In other words, this person was going to spend countless hours trying to re-create something that already exists. All to save a few dollars. Not only was he being penny wise and pound foolish, he was also trying to re-invent the wheel. Both are a huge waste of resources.
I see a lot of contractors do this on a regular basis. They plod along, year after year, doing the same things. They vow that next year will be better. They keep looking for some magic marketing pill. They keep trying to hook up with a general contractor or builder who will overwhelm them with work. And they keep refusing to do the simple, proven things that will actually help them build a better business. That's more than penny wise and pound foolish, that's just plain foolish.
I witnessed a humorous (at least it was humorous to me) example of this during a meeting with a general contractor. He was presenting several painting contractors with a very large project involving a national fast food company. He was giving us some general information about the project, which was going to occur in cities across the South. At one point he mentioned that we would be using Sherwin Williams' products, so we would not have problems getting the same products.
One of the contractors started asking which specific products we would be using. He wanted to know if we'd be using SuperPaint or ProMar, whether the walls would be flat or satin, etc. Mind you, this project was still in the planning phases and no products had actually been specified yet. The issue was not the product, but how we would organize production and insure quality control. The product was an irrelevant detail.
I recently read a similar story on Denise Landers' blog.
One former user of Paper Tiger software told me he’d wanted to recreate that product’s great functionality by setting up an Excel spreadsheet and doing keyword searches to find his filed documents. I suggested he just buy the software instead, and maybe putting a completed time management worksheet in his first new file.
“Do you think you’ve saved money by trying to do that yourself, instead of just buying the software?” I asked. “Isn’t your time really worth more than that?”
In other words, this person was going to spend countless hours trying to re-create something that already exists. All to save a few dollars. Not only was he being penny wise and pound foolish, he was also trying to re-invent the wheel. Both are a huge waste of resources.
I see a lot of contractors do this on a regular basis. They plod along, year after year, doing the same things. They vow that next year will be better. They keep looking for some magic marketing pill. They keep trying to hook up with a general contractor or builder who will overwhelm them with work. And they keep refusing to do the simple, proven things that will actually help them build a better business. That's more than penny wise and pound foolish, that's just plain foolish.
Thursday, September 25, 2008
A Family Affair
Many paint contracting businesses are family affairs. This can add to the complexity of the business, as the lines between our personal and professional lives get blurred. Unfortunately, many such businesses do not have clearly defined roles for each family member and the business is operated like a democracy.
While input from family members can be a good thing, too many chefs can spoil the soup. If each person is adding a pinch of this and a pinch of that, you can wind up with a rather nasty tasting soup.
As Erin Duckhorn writes on the E-Myth blog,
While input from family members can be a good thing, too many chefs can spoil the soup. If each person is adding a pinch of this and a pinch of that, you can wind up with a rather nasty tasting soup.
As Erin Duckhorn writes on the E-Myth blog,
If you tell a child one thing, and your spouse tells them another, how does the child know what they are supposed to do? Mixed messages lead to trouble. The same thing goes for an employee, and it's especially important when the employee is reporting into a family situation. It's vital to have a clear management structure so your employees know exactly who they report to and what's expected of them.
A family business is no different from any other business, except that it can be more difficult to operate. A business should not be a democracy. Clear lines of responsibility should be drawn, as in any business.
Certainly, the emotions involved and the personal knowledge of family members can complicate matters. But family members must realize that when they enter the business door personal issues must be pushed aside. The success of the business demands it.
Thursday, September 18, 2008
The Hurricane Experience
Having lived in Houston for 28 years, I have been through hurricane preparedness more times than I can count. Prior to Ike, I've only experienced one direct hit, and that was nearly 25 years ago. My wife had never experienced a hurricane, and was somewhat excited about the possibility.
The hurricane first made its presence felt at my home shortly before midnight Friday. Hurricane force winds continued for about 10 hours, and we had tropical force winds for many hours after that. We received about 8 inches of rain during the hurricane, and another 3 inches on Sunday morning.
It is hard to explain hurricane force winds, particularly when they last for 10 hours. The best description is to imagine driving 100 miles an hour with your head out of the window. There is a continual, loud roar which became almost calming at times, because when a gust blew through the noise was very eerie. That this was occurring in the dark certainly did not help.
When we were finally able to emerge from our house (which suffered about $20 of damage) we found that our neighborhood had been transformed. Limbs, branches, leaves, and other debris littered yards and the roads. At least a half-dozen trees in my neighborhood were uprooted.
In the days since, as we have cleaned up debris, tolerated the absence of electricity, and basically engaged in glorified camping, my wife has remarked that hurricanes are not quite as exciting as she had imagined. She had only considered the actual hurricane part of the experience-- the anticipation, the wind, etc. She had not considered the aftermath--the destruction, the inconveniences, and the disruptions. In short, she had not considered the consequences.
This is not a negative comment about my wife. To be honest, the destruction and inconvenience has greatly exceeded anything I anticipated. I knew that some would lose power. I did not expect the entire city to lose power.
Similarly with our businesses. We must do more than look at the short term impact of a particular action or policy. We must look beyond, and identify what will result further down the road. A short term benefit (like the "joy" of a hurricane) can ultimately lead to consequences that are less pleasant (like no electricity for days).
So if we don't market we get the short term benefit of saving money. In the long term we have fewer leads. If we don't develop systems, we cannot delegate. If we don't write plans, we blow around in the wind. And if those winds happen to be of hurricane magnitude, the results can be quite unpleasant.
The hurricane first made its presence felt at my home shortly before midnight Friday. Hurricane force winds continued for about 10 hours, and we had tropical force winds for many hours after that. We received about 8 inches of rain during the hurricane, and another 3 inches on Sunday morning.
It is hard to explain hurricane force winds, particularly when they last for 10 hours. The best description is to imagine driving 100 miles an hour with your head out of the window. There is a continual, loud roar which became almost calming at times, because when a gust blew through the noise was very eerie. That this was occurring in the dark certainly did not help.
When we were finally able to emerge from our house (which suffered about $20 of damage) we found that our neighborhood had been transformed. Limbs, branches, leaves, and other debris littered yards and the roads. At least a half-dozen trees in my neighborhood were uprooted.
In the days since, as we have cleaned up debris, tolerated the absence of electricity, and basically engaged in glorified camping, my wife has remarked that hurricanes are not quite as exciting as she had imagined. She had only considered the actual hurricane part of the experience-- the anticipation, the wind, etc. She had not considered the aftermath--the destruction, the inconveniences, and the disruptions. In short, she had not considered the consequences.
This is not a negative comment about my wife. To be honest, the destruction and inconvenience has greatly exceeded anything I anticipated. I knew that some would lose power. I did not expect the entire city to lose power.
Similarly with our businesses. We must do more than look at the short term impact of a particular action or policy. We must look beyond, and identify what will result further down the road. A short term benefit (like the "joy" of a hurricane) can ultimately lead to consequences that are less pleasant (like no electricity for days).
So if we don't market we get the short term benefit of saving money. In the long term we have fewer leads. If we don't develop systems, we cannot delegate. If we don't write plans, we blow around in the wind. And if those winds happen to be of hurricane magnitude, the results can be quite unpleasant.
Tuesday, September 16, 2008
Advice You Don't Need
On occasion I stumble across an article that purports to give good advice for starting a painting company. Last week I was pointed to such an article by a post on PaintTalk.com This article, like many of the sort, offered advice that was not just bad, but actually destructive.
The article begins on a very bad footing:
I've been in business for 22 years, and I do not know what a "sir compressor" is. But I suspect that it is some fancy equipment, like an electrical paint roller. Regardless, this article starts by essentially saying that anyone can paint. But don't take my word for it:
Now I have nothing against high school kids-- I used to be one-- or seniors-- I hope to be one some day. But this is just silly advice. Certainly such individuals could learn to paint properly, but the article says nothing about training.
More interesting (or maybe depressing) is that the seniors did the work for "less than half what a painting contractor would have charged!" So apparently the business being described is not a paint contracting business. Further, the author is advocating either low-ball pricing or ripping off the workers or something equally inane.
But it gets better:
Has this author ever heard of a change order? To arbitrary add 10% because a customer might want to modify the orginal agreement is simply horrible advice. If the customer modifies the agreement, you simply write a change order and charge accordingly.
Then, when you are done, "hopefully" you will get paid. I do agree that if you don't get paid you could be in trouble, and that is probably the only sentence in the article with which I agree. But rather than advocating requiring a deposit and progress payments, the author suggests getting a clear understanding of the payment schedule. In other words, ask the customer when he intends to pay you.
That's like asking the wolf to guard the chicken coop. A painting contractor should establish his terms and conditions and communicate those to the customer.
It's bad enough that there are low-ball hacks passing themselves off as painting contractors. But when someone writes an article encouraging people to open a painting business because it's easy, well it just makes me want to spit. Or write a blog post about what a disservice they do to our profession.
The article begins on a very bad footing:
If you would like a service business that will keep you busy, house painting is the one! A truck or van, ladders, brushes and some drop cloths are the main mechanical needs; you are the other ingredient needed for a thriving business. This is a business where you can get by with the bare minimum investment at first, then build slowly as your business increases -- adding sir compressors, electrical paint rollers, and other fancy equipment as you need and can afford it.
I've been in business for 22 years, and I do not know what a "sir compressor" is. But I suspect that it is some fancy equipment, like an electrical paint roller. Regardless, this article starts by essentially saying that anyone can paint. But don't take my word for it:
As long as you can take care of the paperwork, you can hire helpers to do much (if not most) of the actual painting. Consider hiring high school and college kids during the summer, and don't overlook retirees. One entrepreneur went to a senior citizen's club and found a group of retired men who would go out and paint his houses without supervision. They did excellent work, kept their own time records, and did the jobs for less than half what a painting contractor would have charged!
Now I have nothing against high school kids-- I used to be one-- or seniors-- I hope to be one some day. But this is just silly advice. Certainly such individuals could learn to paint properly, but the article says nothing about training.
More interesting (or maybe depressing) is that the seniors did the work for "less than half what a painting contractor would have charged!" So apparently the business being described is not a paint contracting business. Further, the author is advocating either low-ball pricing or ripping off the workers or something equally inane.
But it gets better:
One contractor sizes up his prospective clients and adds 10% to his bid for those he suspects will want a lot of modifications. When the job is completed, you will hopefully be paid in full. Here is where you can get into trouble! You have already paid for the materials and your helpers (or owe them), and the owner wants to pay you "next week." One or two cases like this will teach you to get a clear understanding of payment BEFORE you start the job!
Has this author ever heard of a change order? To arbitrary add 10% because a customer might want to modify the orginal agreement is simply horrible advice. If the customer modifies the agreement, you simply write a change order and charge accordingly.
Then, when you are done, "hopefully" you will get paid. I do agree that if you don't get paid you could be in trouble, and that is probably the only sentence in the article with which I agree. But rather than advocating requiring a deposit and progress payments, the author suggests getting a clear understanding of the payment schedule. In other words, ask the customer when he intends to pay you.
That's like asking the wolf to guard the chicken coop. A painting contractor should establish his terms and conditions and communicate those to the customer.
It's bad enough that there are low-ball hacks passing themselves off as painting contractors. But when someone writes an article encouraging people to open a painting business because it's easy, well it just makes me want to spit. Or write a blog post about what a disservice they do to our profession.
Thursday, July 24, 2008
Brian Doesn’t Know
Over the years I’ve hired dozens and dozens of painters. No matter their experience, their ethnicity, or their gender, one idea seems to ultimately come out of the mouth of virtually every one of them—Brian doesn’t know anything about painting.
My company has painted thousands of homes. Since I land about 1 in 3 jobs I look at, this means I’ve looked at a tremendous number of jobs.
I have had 3 to 5 crews in the field for the past 15 years. While each individual crew only sees the job they do, I have seen 9 to 15 jobs. In other words, I see and experience far, far more than any individual crew or painter. Yet, I know nothing about painting.
This idea seems to arise because I do not have a paint brush in my hand. If I'm not painting, how could I possibly know anything about the subject? But I don't need to poke myself in the eye with a stick to know that it will hurt. There are other ways to learn about something besides actually doing it.
These comments usually arise when I make a suggestion about the project. This is particularly true when my suggestion involves doing some new. My comments are met with blank stares, shakes of the head, and/ or dismissal.
Despite the fact that I know nothing about painting, guess what happens when they have a question or a problem? They are calling me. Which means, while I don’t know anything about painting, I am also supposed to have all of the answers. Kind of ironic, huh?
© BEP Enterprises Incorporated 2008
My company has painted thousands of homes. Since I land about 1 in 3 jobs I look at, this means I’ve looked at a tremendous number of jobs.
I have had 3 to 5 crews in the field for the past 15 years. While each individual crew only sees the job they do, I have seen 9 to 15 jobs. In other words, I see and experience far, far more than any individual crew or painter. Yet, I know nothing about painting.
This idea seems to arise because I do not have a paint brush in my hand. If I'm not painting, how could I possibly know anything about the subject? But I don't need to poke myself in the eye with a stick to know that it will hurt. There are other ways to learn about something besides actually doing it.
These comments usually arise when I make a suggestion about the project. This is particularly true when my suggestion involves doing some new. My comments are met with blank stares, shakes of the head, and/ or dismissal.
Despite the fact that I know nothing about painting, guess what happens when they have a question or a problem? They are calling me. Which means, while I don’t know anything about painting, I am also supposed to have all of the answers. Kind of ironic, huh?
© BEP Enterprises Incorporated 2008
Subscribe to:
Posts (Atom)
Posts
