Ask The Coach

E436: Ask Coach – Should I Stick To One Niche Market?

April 18, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Stick to a niche to get rich but don’t put all your eggs in one basket.

 

Q: You talk a lot about focusing on a niche market, should I stick to only one market?

A: No, However, you should master one before branching out.

 

  1. Focusing on a niche is important
    1. We want to be the preferred provider so we need to be the best
    2. Focusing on a niche allows us to gain knowledge that other don’t have
    3. Our crews and teams have efficiencies that others struggle to obtain
  2. There is a downside that we need to protect against
    1. Market conditions change and your work could dry up
    2. New technologies or materials could make advances
    3. Your clients may not have enough work for you to grow
  3. Master your niche and then expand and repeat
    1. First focus on growing and mastering your current niche
    2. Expand your client base in that niche
    3. Then look to branch into other niche markets
      1. The question came from Peter who does light commercial plumbing and after our discussion, he started looking to branch into restaurant work
    4. Find a niche the requires complementary skills and grow from there, preferably with you current clients

E431: Ask Coach – Dealing With Project Delays

April 11, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Delays happen in construction, be proactive and manage the impact.

 

Q: What is the best way to deal with project delays?

A: Communicate, adjust and protect your profits.

 

  1. Communicate early and often
    1. Know your contract and your schedule
    2. As soon as it appears there may be a delay – notify your client with a “heads up”
    3. Document clearly cause, impact, options, adjustments and resolutions
  2. Manage your costs
    1. Adjust your schedule where you can
    2. Manipulate your manpower to deal with the delay without cost impacts
    3. Shift your plan around if you can
  3. Protect our bottom line
    1. Do all you can to avoid added costs caused by delays but if you can’t
    2. Document the impacts and communicate before there is an actual impact
    3. Present options and let the client participate in the decisions
    4. It’s our right to make a profit so don’t be afraid to ask for it

E426: Ask Coach – Dealing With A Slow Paying Client

April 4, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Managing our cash flow can be very challenging when dealing with a slow-paying client.

 

Q: What’s the best way to deal with my slow paying client?

A: Work closely with them to eliminate any hurdles and keep communication going.

 

  1. Understand why the pay is slow
    1. Paperwork
    2. Money flow
    3. Poor management
  2. Prevent what you can
    1. Know your client – know what they expect
      1. Make adjustments to better absorb the slow pay
    2. Do the paperwork properly the first time
    3. Keep an open line of communication
  3. Be smart and proactive
    1. Don’t make accusations – people in glass houses shouldn’t throw stones
      1. Do you pay your people timely?
    2. Follow-up on your invoices
    3. Protect yourself
      1. Know the time limits on filing any liens or claims and always protect your rights
    4. Don’t make threats until there is no other option

E421: Ask Coach – Project Promotional Signs

March 28, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Putting up job site signs can bring great recognition, just be sure it’s positive.

 

Q: Should I install company promotional signs on my projects?

A: Yes, 99% of the time it’s a good idea.

 

  1. Promotion and marketing are important
    1. It’s the lifeline of the company
    2. It brings in potential customers
    3. Signs are a great tool for building awareness
    4. The only people who will notice your project are people in the market for you
  2. When they work and when they don’t
    1. They work best on projects where the public can see your work
    2. They also work well on projects that stand out and people notice
    3. They don’t work on messy or unsafe projects
  3. Do it right
    1. Use signs that are professionally designed and built (don’t put a vehicle sign on a piece of plywood)
    2. Place the in the proper location (safe, easy to see)
    3. Keep your sign and your site clean
      1. If the site is not clean or it’s unsafe – take you sign down

E416: Ask Coach – Dealing With Difficult Client Employees

March 21, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Take the high road when dealing with difficult managers.

 

Q: What is the best way to handle a project manager that is doing a bad job?

A: First, protect yourself. Second, try to help them improve and/or let the company know.

 

  1. We run across them from time to time – those difficult people
    1. The PM that is a moron
    2. The superintendent that doesn’t know how to coordinate
    3. People with an ego bigger than the door
  2. How can we best deal with them?
    1. Ask, can you fire this client after this project?
    2. Yes:
      1. Document everything in writing
      2. Follow the contract to a tee
      3. Charge them for anything that is wrong
    3. No: (this makes it tougher)
      1. Avoid making a knee-jerk reaction and calling management (try to fix in field first)
      2. Document everything in writing – present your concerns in a nice manner (avoid arguments)
      3. This difficult person may eventually see you are there to help and change tune
      4. Approach management after the project is complete
        1. If you approach them during the project they may feel you are trying to get out of something

E411: Ask Coach – Dealing With A Loser

March 14, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

It happens to the best of us, a loser project. The best solution is to jump in and correct course.

 

Q: I have a project that is losing money. What is the best way to deal with it?

A: Go into attack mode and limit the downside.

 

  1. It happens, even to the best in the business – A loser project
    1. Hopefully, you know early
      1. If you practice what I talk about you know as soon as things start to turn bad
    2. There are many reasons projects go bad
      1. Clients / People / Productivity / Management / Estimating / Etc.
    3. The common reaction is too often to cut cost and hope it goes away
      1. That’s not the best approach
  2. The right approach is to attack the problem
    1. Don’t let a loser drag you down
    2. Find out what went wrong
    3. Put a full court press on getting the project done and behind you
  3. Be open and creative
    1. Don’t be embarrassed, we all have them
    2. Be open with the people involved – let them know you are struggling (they probably already do)
    3. Talk to your team, suppliers, subs, client and others involved – solicit their help
    4. Get outside help – a different set of eyes can often find better solutions
    5. Ramp up productivity
      1. If it’s possible, ramp up the productivity and get the project complete as quick as you can

E406: Ask Coach – Is Your Overhead Estimate Right?

March 7, 2016 TonyB Ask The Coach, Coachcasts, Uncategorized 0 Comments

Tracking and correcting overhead is just as important as job productivity.

 

  1. Common miscalculations
    1. Using a standard overhead markup and not checking it
    2. Not allowing for fluctuations in sales
    3. Not checking and tracking overhead
  2. The best way
    1. If it’s job-related it should be part of your cost of goods sold (COG)
    2. Set your rates based on real historical data
    3. Try to cover your overhead in 9 to 10 months
      1. If you overhead is $500K and you do $5M in sales our overhead is 10%
      2. Your markup should be 12% to cover the $500K in 10 months
  3. Track and adjust just like productivity
    1. Track your billings and earnings for each month
    2. If you are falling behind make adjustments
    3. Trim you overhead, increase productivity or get more sales
      1. Just watch lower numbers too much for the sales

E401: Ask Coach – Is Your Estimated Productivity Right?

February 29, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Manage your projects closely yo make sure production matches your estimate.

 

  1. Establish benchmarks
    1. Look at estimating guides (just for a start)
    2. Compare to your experience and actual production
    3. Use your gut
  2. Make adjustments
    1. Job specific adjustments
    2. Seasonal effects on production
    3. The effects of your personnel
    4. Use historical feedback
  3. Tracking, monitoring and adjusting
    1. It could be said that your estimate is right if you got the job
      1. Now it’s time to hit the numbers
    2. Develop tracking systems for key metrics to make sure you hit the numbers
    3. Make adjustments to productivity and cost
      1. The bottom line is to finish the project at or below estimated cost

E396: Ask Coach – Is Your Estimate Right?

February 22, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Not making enough money on your projects? Is your estimate right?

 

Q: When I look at my financials I am not making the money I should be. How do I know if my estimate is wrong or something else is wrong?

A: There can be many things that cause us to lose profitability. The 3 key areas to look at first are productivity, overhead and market conditions.

In today’s Coachcast I am making the assumption that the overall estimating practice is sound and done based on crew production, not a plug and play unit price number.

 

  1. Productivity
    1. Your estimate should be based on productivity – that is a crew should complete so many units per hour
    2. Track your projects to determine if you are getting the same or better production then you bid
    3. Be careful of using best case productivity for your estimates
    4. If you are not getting the productivity then find out why and if you can correct it
  2. Overhead
    1. Are you making money on the projects only to lose money in the business?
    2. Make sure you have accurate overhead mark-ups
    3. Can you lower overhead, cna you increase mark-ups and still win
  3. Market Conditions
    1. Is your pricing being controlled by market conditions – you wouldn’t win if you raised your price
    2. Make sure that is the truth – many people say that then find out they actually win more with higher pricing
    3. If you cannot raise your prices then you have two choices
      1. Lower costs by increasing productivity and cutting expenses
      2. Find a new market

E391: Ask Coach – Finding The Right Niche Market

February 15, 2016 TonyB Ask The Coach, Coachcasts 0 Comments

Choosing the niche that’s right for you takes careful consideration.

Q: How do I decide which niche it right for me?

A: 1.) What are you passionate about? 2.) What are the market conditions? 3.) What is the current state of your business?

 

  1. Your passion – not just the projects you like
    1. What types of projects get you excited?
    2. What other aspects of business get you excited?
      1. Don’t like paperwork, avoid Government work
    3. What types of clients do you like working with?
  2. Market conditions
    1. What type of work is available in your market?
    2. Is there enough work? Do you need multiple niches? Do you need to travel?
    3. Can you sustain and grow your business in the niches? Will they last?
  3. Current state of your business
    1. What talents, equipment, people, resources do you have? How do they fit?
    2. What additional resources are required?
    3. You can always start small and grow into your niche(s)

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