Ten Tips for 2010!
It’s time to shift your focus from defense to offense. Cutting costs is essential, but the easy cuts have already been made. Further cuts will probably slice into muscle and bone. And as any one can tell you cost cutting is not motivational. Getting on the offensive is more uplifting. More than ever revenue growth and cash management are essential to your success given the realities of slow paying of customers, lower prices, and stingy banks and vendors. Here are ten ideas for getting on the offensive.
1. Obsess on your accounts receivable.
Review your ageing reports EVERDAY and place reminder calls to your customers. Start at 15 days. Where you can, get deposits. And be certain to invoice the very day of job completion.
2. No one gets raises.
Tell your employees you have a plan that can keep them happily employed – but there are no raises until the clouds lift.
3. Spend more on marketing.
Use door hangars. Use direct mail. Use email blasts. Send a message outlining money saving solutions to landscape “problems”. Do this every month. Out of sight equals out of mind. Simple, helpful and frequent “touches” are the keys to lead generation.
4. Get out and sell.
The good old days of answering the phone are over. Customers will not beat down your door; you have to beat down theirs. Yes - you the owner - must prospect and make calls or find someone who will.
5. Work on lower pricing.
We are in deflationary times. Worry less about gross profit percentage, and more about selling enough gross profit dollars to pay for overhead every month.
6. Communicate with your customers – past and present.
Other contractors are calling on your customers. Given that there is very little loyalty out there, you must defend your turf. Meet with your customers and ask them, “How can we add value for you and help you in this economy”?
7. Expand the services you offer.
Offer more services to your existing customer base. Customer spending next year will have an ROI emphasis. Saving money, reducing risk, and eco-friendly (as long as it contributes to realizing the first two) top the list. Demonstrate to the customer how they save by spending wisely on the right service.
8. Keep your banker and vendors in the loop.
You will need credit to fund growth. Put together a budget and cash flow forecast - then meet with these people to re-establish credit facilities and terms for 2010.
9. Clean house.
This may sound harsh, but now is a great time to get rid of C players. Cleaning house has three virtuous effects. First – morale improves. Second –A and B players can make more money picking up the slack. Third – you will sleep better.
10. Look for a diamond in the rough.
There are talented people looking for work right now. If you must focus on sales, you will need talent in operations. It costs nothing to advertise in Craig’s List – and everyone looking eventually looks there. When you find a diamond, hire them even if it costs more than you are used to paying. Good people pay their way.
I am convinced now that the old “rules of the game” are forever gone and we are entering into uncharted territory. These ten ideas can get you on the offensive, off your heels and back on your toes. I am reminded of my football coach whose every pre-game pep talk was a variation on the same theme; “Boys, let’s do it to them before they do it to us.” That’s where I think we are in this economy. The world is presenting business owners with a clear choice - hang onto the past or leap into the future. Time to play offense.