grey haired man pondering his future

Exit planning for trades businesses

Owner

If you are thinking about selling your business over the next 5-10 years, do you think you will achieve the sale price you need to fund your ideal future in such a potentially crowded marketplace? Of those business owners who intend to exit their business in the next 10 years, 70% intend the sale to fund their retirement, but 87% have no formal plan on how they will do this. (Centre for Small Enterprises – Massey University)

The message of planning a successful exit from business has not yet been taken to heart by the majority of business owners and this may result in a lot of unfulfilled dreams of a long and happy retirement. The general attitude of: “I’ll get round to it when I have to,” is all too prevalent and the point of early planning to maximise value at exit is lost on many.

Spock mind meld

Marketing Lesson from Mr Spock

Marketing, Sales

For those of you old enough (like me) to remember Leonard Nimoy as Mr Spock on Star Trek may also remember the Vulcan Mind Meld trick he used to perform.  In order to understand a subject person better or uncover hidden memories, Spock would place his hands on a person’s head and mentally become one with them.  He would then be able to think as that person thinks and of course help save the day in some way.

What does Star Trek got to do with marketing for builders and trades?

In terms of marketing for builders, quite a bit it turns out. When developing your marketing and sales strategies, I want you to think, “Vulcan Mind Meld” as the first thing you do BEFORE you think about spending any time or money on implementing tactics.

Why? Learn more…..

Husband wife working together

In business with your spouse

Owner

Owning and operating a business with your life partner or spouse is no easy task.

On the bright side there are upsides to working and living with your business partner. For one thing, you trust them. Another big plus for working together is it will save your business money. Hiring your spouse for a role they are well equipped to do, i.e. they have the education, skills and training, is cheaper than hiring someone else. Not only will there be no recruiting fees, but your spouse, like you, may also accept a lower than market rate salary.

However, there’s no way to avoid disagreements that will rise arise from work and personal interaction. Many couples just don’t navigate the obstacles of working and living together very well so if you are in business with your life partner the following tips may help keep you out of the family court going through a divorce.

increase profits

A Budget Process in 7 Easy Steps

Financial Management, The numbers

To most trades business owners the mention of budgeting makes their eyes glaze over or reject the idea outright. “I can’t predict what is going to happen next week, let alone in 6 months or more!” is a common response. But it doesn’t need to be that way. A budget is the best way I know to gain a greater feeling of control over your business and therefore your life.  Knowledge is power, so they say, and the knowledge you will gain about your business and what you need to do in order to change it, is an empowering process. A budget also ensures that you know before the year starts what you need to do to earn the return on your investment that you expect.

Closed sign

Business is busy, but companies still going bust.

Financial Management, Owner

The NZ Herald reported recently that despite construction being very busy, small to mid sized businesses in the industry are still going bust. In fact construction has overtaken food service as the number one business category for liquidations in the first two months of this year. This is one first place award that we should be proud of!

Should you be worried?  Probably. If not worried, you should at least be aware that things are not all glittering out there and you should look at reviewing your financial systems and your understanding of some key numbers. What you can measure, you can manage. What you can manage, you can change. Here are two key financial areas to monitor in your business.

Blog picture

What to write on your blog page

Marketing, Sales

A good way to naturally rank higher on Google (everyone’s goal) is to ensure that your construction website blog has a good amount of useful information on it that Google recognises as helpful to potential customers. The problem is not many tradespeople are natural writers, or even know where to start. That blinking cursor in the top left hand corner of a blank screen can be a frustrating and scary thing.

As a residential construction company, there are several blog topics that you can write about to showcase your expertise and provide value to your readers. To help get those creative juices flowing here are some ideas:

missing jigsaw piece

How to develop a competitive advantage

Marketing, Profitability

A lot of people (including me) talk about competitive advantage and how it is vital to have one for the ongoing success of your business.  This is very true, but what is the BEST sort of competitive advantage to have?

In a highly competitive industry like construction, it can be challenging for small businesses to stand out and establish a competitive advantage. However, with the right strategies and mindset, a small construction company can gain a foothold in the market and develop a competitive edge that can help them thrive and grow. In this article, we will discuss some effective ways to develop a competitive advantage for a small construction company. Click on the article to read more

trust chain link

How to increase trust from your customers

Marketing, Sales

Who has put hours of effort into pricing a job only to loose it to someone else that the client says “is a better fit”?  Everyone, right?  This can be even more frustrating if the other company has put in a higher bid!  Why didn’t you get the job?  Your price was competitive. You do quality work. You have the capacity to do it.  What it may come down to is that the prospective client didn’t TRUST you enough.

But you’re a trustworthy person!  Can’t they see that?  Well, possibly they can’t, or at least you didn’t do enough to build up that level of trust more than the other company did.  In the residential market in particular, building up the level of trust at the early stages of the sales process is vital to increasing your chances of securing a sale, without having to slash your price. With the country going into a period of economic and political uncertainty, consumers are going to be looking even harder for companies that give them a feeling of comfort and certainty.

tape measures as a graph

The Importance of Back-Costing

Financial Management, Owner, Profitability, The numbers

Do you know what the actual gross margin you make from a job as soon as its finished, or for bigger jobs how you are tracking at each stage? Or are you so busy you just rush to the next job and hope the previous job delivers enough profit to stay in business?

Tracking how a job performs from a profit perspective compared to a quote or estimate is called back-costing, or job-costing as Americans call it, and is vital to maintaining a profitable company and to help you achieve your goals.

Measuring performance

Improve efficiency with lean construction

Financial Management

In my mind sustainability is as much about economic survival and profitability as it is about our concern for the natural environment. Also, the two aspects of sustainability are not mutually exclusive and can lead to a win-win outcome.

One aspect of sustainability that you could consider is the adoption of Lean Construction principles. Lean theory has come from the manufacturing sector, most notably the car manufacturer Toyota. The Toyota Way was a movement that lead to the company becoming the most successful car manufacturer in the world and has been adopted and adapted by many companies in several industries since.

But building a car is not like building a house, I hear you say. You’re right. Many of the principles of Lean Manufacture need adapting for construction due to the different environment you work in and the bespoke nature of many projects. That said there are several fundamental principles that are used in Lean Construction which can help you improve both the environmental and economic sustainability of your business.