Jump in puddles

Jump In Puddles

Marketing, Owner

With a recession typically comes a reduction in consumer confidence and a trend to delay or cancel big-ticket spend items. Building projects are the biggest ticket of them all. To combat this you should be looking at increasing your marketing. If you have been using “word-of-mouth” as your only marketing strategy over recent years, it’s time to review your activities in this space and put together a more comprehensive plan.

The first place I suggest you start in putting a marketing plan together is picking a market segment or two in which to focus your energies. Segmentation is the most fundamental of marketing concepts. To quote marketing guru Theodore Levitt, “If you’re not talking segments, you’re not talking marketing”. Furthermore, there has never been a greater need for effective segmentation, due to several factors:

10 Steps to Reversing Horrifying Negative Online Reviews

Client management, Owner

Have a few unhappy customers who made it their business to burn you through website or social media complaints? Here’s how you can turn around your online reputation. Guest post by Kate Zabriskie

“The worst customer service experience ever! The plumber arrived an hour late for the appointment and was surly. Stay away!!!”

“If you are offered a job at this place, run! Do not walk to the nearest exit. This company is an asylum. I have never worked with a more dysfunctional group of people in my life.”

Ouch! Those hurt.

And there it is, in black and white for anyone and everyone to see: what someone thinks of your product, your service, or your organization. Bad reviews can bite, wound and sting. Worst of all, a mountain of them can appear in a matter of seconds. Social media: It’s a wonderful thing, until it turns against you.
So, what’s a person to do when his or her online reputation is suffering at the hands of others? Plenty.

Hand held compass

Are Business Plans a Waste of Time?

Owner, Planning

As a business advisor it may seem strange that I should ask that question at all.  Don’t all advisors/mentors/coaches stress the need to have a business plan and say things like, “fail to plan is a plan to fail”? 

In my opinion it comes down to the type of business plan that is produced and the length of time it takes to produce it.  Many business plans ARE a waste of time because they are too wordy, too “corporate”, don’t motivate staff and are not connected to the day-to-day operations of the business.  I read an article recently on writing a business plan (unfortunately I can’t remember where) and it said that a business plan could take between 400 and 500 hours to produce.  ARE YOU KIDDING!  Who in small business ownership world has a spare 500 hours to produce a business plan, and probably one that no one will look at again for another year! That would be a huge waste of time.

What is of real value is the planning PROCESS involved in putting a business plan together. Here’s how….

future business paths

Take Control of Your Future

Owner, Planning

As you get back into work post lockdown and focus on catching up lost ground, I would encourage you not to just go back to the day-to-day mentality and assume that things will continue as they currently are. With a potentially severe recession ahead, just continuing to do the types of things you have been doing around business strategy could mean you become dragged down by the negative market forces.

In the chart above there are generally three future scenarios that could play out for you, determined largely by the type of actions that you take now and over the next few months. I have put down a future time line to measure possible results of 18 months. It’s a bit arbitrary on my part and you may feel the measuring post should sit at 12 months, or something else. In the end it’s not critical where we put the line; what is important is to look at the pathway towards it and which one do you want to be on.

Insurance 101 for Tradies

Financial Management, Owner

At Builtin we deal with thousands of tradies up and down the country, so we know insurance isn’t anybody’s favourite topic! While it’s not something you want to think about, it is something you need to have, and need to have properly arranged.  Having to replace an expensive asset that’s been stolen or damaged, or getting tied up in an expensive liability issue can hammer a small business, not only financially, but they can take an emotional toll on the contractor and their family too.

For larger firms their exposure to risk is greater, as is their capacity to manage it. For company managers and directors, getting the right professional advice and having good risk management practices in place, including insurance cover, is a critical (and legal) duty.

Most of our customers want what we call the “Goldilocks Package”: not too little, but not too much. That’s what we help our customers with every day.

In this article we share some basic risk management questions, as well as the headlines of the key policies contractors need to consider. What you need will vary according to your specific operations and business set up, but this should serve as a good overview to get you started.

Interior Design as a Value-Add

Marketing, Owner

I have a guest post for you this time from Natasha Bozic, an interior designer in my network group. Builders in particular should consider adding in an interior design service to what they offer to clients in order to help differentiate themselves from competitors and also deepen the relationship with the potential client. Being married to a builder, Natasha knows the process and how best to fit in. Here’s her story.

How many times it has happened that instead of following your daily schedule and focusing on your construction work, you got caught in long discussions and questions from clients about what paint colour to choose, what is the best floor plan for a bathroom renovation, where to buy certain products for the renovation projects, what colour vanity to choose, what do you think about their tile selection etc? Read more….

Builder giving thumbs up

COVID-19 Update: The independent tradie guide on surviving economic and business uncertainty

Financial Management, Owner

It’s been a week since New Zealand went into Level Four lockdown in efforts to stop the spread of COVID-19. As the owner of an independent tradie business, you might have spent the last week trying to sort out a new routine, or maybe you were able to catch up on some rest and family time after a busy summer working in your business.

Due to the impact of COVID-19, New Zealand and the world is experiencing an uncertain and disruptive business climate; now is not the time to hibernate and neglect your business, your staff and your clients. The truth is what you do in the next four weeks could make all the difference – will you be raring to go or scrambling up from the bottom?

I know the real and sad impact of business failure and I don’t want that to happen to you. That’s why I’ve put together a list of tips to help you manage the short-term business issues you are facing, and help you and your team get prepared and ready to go at full speed ahead once the restrictions are lifted.

stressed business owner

How to Handle a Recession

Financial Management, Owner

Recent world events surrounding the Covid-19 pandemic has meant that economically we are quite likely to be heading into a recession. Technically that is when 2 consecutive quarters show negative growth. We are not there yet, but the economic effects of the Covid-19 pandemic mean that significant parts of our economy will be in free-fall over the next few months, particularly the service sector. No one knows how long it will last. We can only hope we manage to beat the pandemic within a relatively short space of time, like China has, and we can all get back to business as usual.

In the meantime it is prudent to plan for a period of lower business activity….

Bigger Size Does Not Equal Bigger Profits

Owner, The numbers

According to Nicholas Bloom’s Harvard Business Review article, “Corporations in the Age of Inequality,” a slim percentage of top-earning companies actually earn significantly more profit than their rivals in what’s been deemed the “winner-takes-most” economy. As leading companies earn more, there is less profit remaining for lagging companies, only widening the gap.

So, what does the construction industry in particular look like? In research between the Construction Financial Management Association (CFMA) and Coltivar Group, a representative sample of 363 industrial and nonresidential U.S. construction companies ranging from $1 million to over $1 billion in revenue were studied. Profitability and return on investment were used as an objective lens to compare the companies.

While 50% of companies had a competitive advantage, defined as the ability to earn above-industry-average economic profits, the calculation revealed that companies in the top 20% earn nearly 83% of all economic profit, fulfilling the Pareto principle, or the 80/20 rule. The remaining 80% of companies are confined to the dog-eat-dog environment of the lower deciles, where they contend for leftover scraps of industry profit.

How did these successful contractors achieve the initial success to advance up the curve?