3 Pillars of Business Success
When it comes to running a business, it can be overwhelming trying to make sure all aspects of your business are running smoothly. It appears the second you take your attention off one thing to focus on another, everything else crumbles. It can seem like a never-ending cycle but playing off our mission to simplify business for entrepreneurs, we break down the 3 most important things for you to focus on in your business.
The 1st area is to understand the finances of your business and know your numbers! Whether it’s painful or enjoyable to look at the numbers in your business, you must know the scoreboard before you can move forward. This begins with job costing each of your projects to determine profitability and efficiency of completion (comparing estimated hours to actual hours). Once you have a good understanding of this, the next set of numbers to understand is your monthly cashflow. Ensuring that you are profitable on your projects is a great starting point, but it’s important to make sure your business account is growing each month once all expenses are paid, and your owner’s distribution is taken. One mistake we see a lot of contractors make is paying themselves more than the business makes and then utilizing credit cards and other loans to cover the shortfall.
The 2nd area to focus on would be learning how to grow your business organically. While paying for marketing can work well, it isn’t the most ideal when trying to run a lean company. There will be cycles in your business in which this is necessary, however building long-term relationships and lead generation sources will lead to a more profitable business. Not only will you save money on advertising, but you will be more efficient in your sales closing % and your jobs will be completed much smoother. This strategy of organic growth is designed to limit the amount of energy and time necessary to bring in new business.
The 3rd and final most important area to focus on is ensuring that you have a structured interview and apprenticeship program for your new employees. Setting the correct expectations about the job and your company’s culture is crucial to onboarding new employees. Once the intangibles regarding the job are in place, it’s extremely important to have a structured training process along with periodic scheduled reviews with your employees. This will ensure that all your employees are trained the same and your Standard Operating Procedures are being followed by everyone.
When it comes to being a business owner, it’s easy to over complicate things. There are a lot of moving pieces, and you don’t know what you don’t know. One of the best pieces of advice to leave you with would be to always expand your education and knowledge base to help your business grow. With the vast number of resources available at the PCA, there is no excuse for not bettering yourself and your business!