Business owners in the red often refer to their situation as “underwater.” If your business is underwater, it can drown. If your business is 12 feet underwater, and you get it back to six feet underwater, it will still drown. Whether and how you take advantage of this administration’s economic stimulus package might make the difference between your business actually drowning in the next year or two, or pulling itself back to the surface for good.
I see two ways your business can benefit from stimulus money. One might keep it going on a temporary basis, as with breathing through an oxygen tank while you’re underwater. The other could be the difference you’ve dreamed of. Think of it as a super-sophisticated oxygen tank and a super-accurate map that will allow you to find the buried treasure, invest it into rebuilding your business, and eliminate the need to continually dig deeper into debt as you struggle to survive.
The money in the stimulus package is temporary. When it’s gone, will your business be healthier as a result of it? Or will it be right back to where it is now?
First, to find out what is available in the massive stimulus package, I suggest that you rely on experts who have done the research into the money that is available — in your case, primarily in the form of tax credits for homeowners — and can explain how that money can or cannot be used.
This issue of REMODELING magazine and its associated website offer a lot to consider. Smart manufacturers, distributors, and vendors can also be extremely helpful, and they have a vested interest in your success, for obvious reasons.
It’s one thing to know your options; it’s another to exercise them. At my remodeling company, my staff and I benefited greatly from the collective knowledge and education offered by our vendors and other industry partners. They were generous with us because the distributors and manufacturers that supplied them provided the funds or resources to make it happen.
Using the analogy of a car with a dead battery, the stimulus package might be the jump-start required to get your business going again. But, if you are unsure of why the battery died in the first place, the car will probably need another jump-start soon. Likewise if you know why the battery died but didn’t fix the underlying problem.
Prior to the downturn, remodelers enjoyed unprecedented growth in consumer spending. This helped you to grow your business and its related overhead. Unfortunately, many remodelers — and you might be one of them — grew without the proper systems and knowledge to create a sustainable company.
Now that the projects and the money have dried up, many remodeling business models are inadequate or even useless. To get back to the battery analogy, perhaps the only reason your business was still running until recently is because you never fully shut the engine off and therefore didn’t know that the battery was dead.
Like an aging home, your business needs updates and replacements as it matures. When replacing the heating system in a home, you can use the same or similar equipment, or you can replace it with a high-performance, energy-saving unit. Either will heat the house, but one will have lower operating costs over time and might even last longer than the original.
The same might be true for your business. Replacing your sales and marketing systems with tested new models can improve your business now and stage it to weather future challenges.
What will the stimulus be to your business: a temporary boost or a long-term restructuring? Don’t let the economy be your excuse for struggling. Let it be your impetus to rebuild.
—Shawn McCadden founded, operated, and sold a successful design/build remodeling business. A co-founder of the Residential Design/Build Institute and former director of education for a national K&B remodeling franchise, he frequently speaks at industry events and consults with remodeling companies. firstname.lastname@example.org.
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