It’s official: Speaking nationally, we are in the best times for remodeling in this century—and perhaps ever. Metrostudy, the data-gathering and analysis unit that’s a sister company to Remodeling, reported last month that its national Residential Remodeling Index for the second quarter of this year had topped the old record set in the go-go days of early 2007. Of course, your local conditions may vary, but 355 of the 381 local markets are forecast to grow in 2015, and the average increase in activity expected in each of the nation’s 381 metropolitan markets tops 5%.
Hearing that phone ring and collecting enough money to finally buy a new truck are great feelings, and we want you to enjoy them. But at the same time, you should also take advantage of this hot zone to help set up your business so it can take better advantage of good times and be less susceptible to rough patches.
- Raise your rates. If you’ve noticed that your ratio of bids to accepted jobs has increased, that could be a sign your prices haven’t changed with the times. Try boosting your margins by a point to see if they stick. If they do, do it again.
- Recruit temps. During both the slow years and the buildup to today’s frenzy, odds are you let slide tasks that you knew could improve your business but you just didn’t have time to pursue. Examples could include cleaning up your website or researching social media. Now is a good time to hire temporary help for particular projects.
- Analyze Your Numbers. Busy times needn’t be financially messy ones, but often they’re one and the same unless you make an effort to look out for leaks in your spending. As Big50 member Mehdi Vatani pointed out, 1% slippage on a $3 million business totals $30,000. What could you do with an extra $30,000?
- Pursue Efficiency. The busier you get, the more important it becomes for your most valuable field staff—typically, your carpenters—to remain focused on those jobs where their skills matter most. That means you need to minimize reasons why they’d leave the jobsite, such as when they need a sawblade or an extra 2x4. In such cases, it’s probably cheaper for you to send a taxi to the store rather than the carpenter. Or expand by hiring a parts runner.
- Sweat the Early Details. The October issue profiles Bob Gockeler of New Jersey’s Kraftmaster Renovations, this year’s winner of the Fred Case Remodeling Entrepreneur of the Year Award. Pay special attention to how he stages a project. Extra work at the start of the job can save you time and money later—as well as win referrals.
- Re-Acquaint Yourself with Your Banker. You never know when you might need cash, so why not talk to a lender when your finances are strong?
- Invest in Long-Term Growth. Organizations such as GuildQuality, Remodelers Advantage and Certified Contractors Network cost money and time. But you’re more likely to have money now, and participants regularly tell us the hours they spent deliver a fabulous return on investment. It’s time to grow.