Admin, Author at Builders Coach

Could this be you?

Below is a transcript of a conversation I had with a builder who was comfortable enough for me to confidentially share our discussion with you. Have a read through now and look for any similarities in your current situation. If something strikes a cord with you, then drop us a line for a free 15 minute phone consulation to discuss your situation.

Kurt & Chris the Builder Conversation;

Kurt – “Hi Chris, what was the specific reason that made you decide to contact me?”

Chris – “I’ve been in business for 15 years now and it feels like I’ve got NO control, I’m like a hamster on a wheel. Every day I get out there and give it everything I’ve got but there’s always more that pops up in my face. Its too much for me. I can’t stand the feeling of being out of control, I am the business. I’ve got the typical cash-flow and profit problems and I’m sick of chasing money. I’ve got worked booked for the next six months but I worry about what happens if I don’t get more work booked in after that. There’s money in my account but Im not sure which is mine. I need to get the right structures in place so that I can expand the business and make a profit.

“I want to improve my sales and marketing so I don’t have to worry about work drying up and making sure my boys have work lined up and keep them busy. I’m not too proud to put my hand up and get some outside advice. I really need someone to give me some guidance and direction. I need to figure out what we’re doing wrong. It seems like there’s always problems.”

Kurt – “Ok Chris well it sounds like its worthwhile us catching up…… So Chris, tell me, what would you ultimately like to achieve with your business?”

Chris – “I’d like to get it to a point where I’m doing about 4 Million a year turnover, 20 jobs a year. I want some systems both on-site and in the office and a good supervisor who knows what he’s doing who can run the jobs. Then I can take care of the office and make sure the boys have got work. If I can do that, then I’ll be able to bring on bigger jobs and also check the profit on the jobs more closely. I just want to be able to take a small holiday in the middle of the year and then again later in the year as well. Once I get to a certain point I’ll do my own developments and use those profits to do more projects on the side. Once I’ve got the office and the sites running well then I can look at finding someone to take a leadership role and I can start doing developments for myself. I’d also like to set the business up so that my sons or one of the senior guys can take it over down the track.”

Kurt – “Ok, I understand. So Chris, what is your biggest frustration in your business right now?”

Chris – “Money, definitely the cash-flow and the lack of profit”

Kurt – “How is that affecting you personally Chris?”

Chris – “Well its definitely affecting the wife and kids, its not pretty. The wife’s even talking about me maybe going back to work. Something needs to change, we can’t keep going the way we are, that’s the bottom line. If I keep going on like this I’m going to burn out.”

Kurt – Ok Chris you’ve given me a good idea of where you’re at, what I’d like to do now is get more clarity on what you want to achieve and give you a better idea of how the coaching process works….”

If you can realte to Chris’s situation and would like to hear and see exactly what I covered with Chris next, contact us for a free 15 minute phone consultation

Your Price is Too High

Do you have clients tell you “your price is too high”? I have a lot of builders tell me they are getting this feedback even though they know they have cut the quote to the bone.

Do your clients really know one way or the other if your price is too high? “Your price is too high” is a tired old line that your customers have been trained to use to get you, the builder, to pull back on your margins. They have been told by the media, their neighbours, someone at work, their family, whoever, that if they tell you “your price is too high”, you will, in all likelihood, change the quote to some lower number.

I have a friend who does this regularly and says he’s surprised how often people do it, even the major chain stores. I decided to try it recently at a rebel sport store at our local Westfield and they asked me if a $30 discount would be ok? So I know it works and I’d recommend it IF you are the customer.

Lowering the price to win the job is exactly what most “order takers” will do. An educated builder knows better and does not lower their price, unless the client changes the job.

Now you might be saying to yourself, ‘but I know my price was too high because the client told me I came in above the other two quotes!’
“Your price is too high” (and that statement can come in a number of different forms) simply means that you have not done your job as a ‘salesperson’. Plain and simple, you have been lazy and have missed some very important steps in the ‘sales process’.

The number one rule for sales is to ‘qualify’ your prospect. You need to pin down the budget to the point that you know exactly what they want and are willing to spend.

Here are the four essential questions that need to be answered;

1. What do you want to do?
2. When do you want to do it?
3. Who will make the buying decision?
4. What does that person(s) want to spend?

If you get the answer to (at least) those four questions, you will get to a “yes” much quicker. Sticking to and getting the answers to those four questions will help you qualify your prospect and save you a world of pain in wasted time and energy down the track.

Over the years I’ve compiled a list of the most affective qualifying questions a builder can ask. Click here to download them now. Knowing the answer to these questions will take your sales conversion rate from 1 in 6 to 1 in 3 very quickly, without lowering your margins. Learn the technique, ask the questions, get the answers and watch not only your sales increase, but your profits increase as well.

To your ongoing success.

Kurt

MASTER BUSINESS COACH
E: kurt@builderscoach.com
www.builderscoach.com

Attention Builders, what is your system for positive cash-flow?

What is Your System For Positive Cash-Flow?

I recently worked with a builder who a few years ago made the move from working as a sole trader with one labourer doing smallish jobs to building a small team and working on bigger residential renovations and additions.

At first the growth was slow but eventually things started
to snowball as more referral work came in. He soon found
himself with seven or eight jobs on the books and doing more
turnover than he’s ever dreamt of, except he was in financial hell.

Money was going out faster than it was coming in and although he was pricing his work right with a solid 27% margin, there was no money in the bank account. He was either hemorrhaging money somewhere or there were significant
Cash-flow problems. All I wanted was the truth, so the first thing I did was book a time to sit down with his accountant and have a Close look at the numbers. Lets face it the numbers don’t lie and we all know the old adage “The truth will set you free”. I’ve done this on a number of occasions with clients but on this occasion something wasn’t quite right. First of all at the meeting the accountant looked really nervous, not a good sign!

I was struggling to understand the complexity of some of the
Financials and whenever I asked a straight question like what is the
WIP? Or what is the current cash position? Can we look at the
Gross margin on individual jobs and compare? I got a blank stare,
I think “stunned mullet’s” the term.

Long story short, there was a massive “Cash Gap” in the guys business,
things were moving too quickly, accurate financial were non existent and
they were flying blind. The end result almost wasn’t pretty, luckily we were able to make some adjustments and get him back on the right side of the line.

There are two important lessons here, firstly you need accurate numbers
And financial controls otherwise you risk crashing hard, even in good times. Also choose your bookkeeper and accountant wisely. I don’t have time to go into detail on this now but I’ll be sending out something in the coming weeks so watch his space.

Secondly; do you have a solid strategy for ensuring your money comes in before it goes out? That is a system for ensuring positive cash-flow? If you can relate to any of this and would like a free copy of the 21 Cash-flow strategies for your business enter your name and email address on the Builders Coach home page at www.builderscoach.com

What’s it costing you?

A very wealthy Australian was recently heard saying ‘its easy to make money. To make money you just need
to do the things that make money.’ Simple but right on the money!

What is your plan for doing the things that will make you more money this year?

Click link to watch or review the 12 critical areas for making more money in your business in 2013. (<http://BCnltwelvestratsvideo.viprespond.com>)

As fascinating, simple and profound as it is it begs the question, what percentage of your time do you
(or your team) spend on the tasks that make money and how well are you doing them?

I bet you can think of half a dozen things that you (or your team) are NOT doing that you could be doing
to make more money, right? Here’s a small list of questions to prompt you;

1) Could you be more efficient with your time?
2) Could you shop around to increase your margins?
3) Do all your invoices go out on time?
4) Could you qualify your prospects better?
5) Could you do more marketing to generate better quality enquiries, even if its just one more phone call a day?
6) Could you manage your finances better so you build more working capital?

If you stop working on a job what happens? You lose money, right. The same applies to working ‘ON’ your
business and the things that make you money.

If you wanted to make an extra $100,000 profit this year what would it take, one extra job? Maybe two or three
jobs. How many more jobs would you need to price and what would you need to do to price those extra jobs?

Lets say you put in an extra four hours / week focusing on generating that extra $100,000. Thats a total of 192
hours focused on generating more work. If its a focused 192 hours, I’d put money on you making the extra
$100,000. If we divide $100,000 by 192 hours thats $520 / hour. But here’s the clincher, once you’ve set up
the systems you should generate the extra $100,000 for the rest of your career!

The most common objection I hear when I recommend spending 4 or 5 hours working “ON” their business is, “I
don’t have time”. If its worth $520 an hour (conservatively) then its costing you $520 / hr. So could you find the
time?