For 20 years I have worked with hundreds of remodeling company owners to improve business practices so that they deliver services that meet or exceed customer expectations and earn their companies a profit. Many have transformed themselves into great businesspeople and their companies into trusted, well-run, profitable machines. That’s why it’s so distressing to hear stories like this:
A neighbor hired a remodeler based on a friend’s referral. Everything went well until week six when no one showed up on site. The client called the company owner who returned the call, gave an excuse for the lack of progress, and got workers to the project. But the cycle kept repeating itself.
“It got so frustrating that I began calling the second in command,” the client says. “Then I’d get the runaround because this guy would say, ‘I have to talk to the big boss.’ We’d be left hanging longer.”
One day, the lead carpenter told the client that the company had no more materials because it had no credit line with the supplier since the company had run out of money. The carpenter soon quit, and the client learned that neither he nor the subcontractors were paid. The client now pays the subcontractors directly, only one of the project’s three phases is complete, and the job is months behind.
As professional remodelers, you need to understand how to run a professional business using processes and systems that help you deliver a great experience. You need to know how to price your work so that you have the resources to build a fantastic product. And you have to understand cash flow and finances to keep the company stable and viable for the long term.
When times were flush and the money was flowing, the lack of business smarts was easy to hide. Not anymore. If you don’t know how to run a business when times are tough and cash is tight, perhaps you should work for someone else before the remodeling industry’s reputation is sunk further. Or make the decision right now to be the businessperson you know you can be.
—Victoria Downing is president of Remodelers Advantage. remodelersadvantage.com