How Do You Start Over?

Mike(VA)

I am sitting here listening to The Christmas Cannon by TSO. You know, the type of song where you just want to keep hitting the ‘repeat track’ button for a while. Sort of like The Menuetto from the L’Arlesienne Suites by Bizet, or For My Lady by The Moody Blues. Anyway, I gratefully digress.

My wife is at work and the house is quiet and I have nothing to do. I mean nothing. I suddenly, well not quite, find myself without ANY prospects whatsoever for next year. The few prosects I had evaporated due to the usual reasons; stock market tanked, house not worth what it used to be, we'll wait until spring to think about it. We do high end custom residential renovations and remodeling. Also we do "Project Rescues". While I do have a few tidbits to finish up, none that are revenue generating, I really do not have anything in the works, the pipeline, or the hopper.

I am in the unfortunate position where I don't have to work. My wife makes a very good living, mid 6 figures, house paid for, kids sold off. I say unfortunate because the usual incentives to hustle and produce something aren't there. I do have one incentive, and that is my wife wants, and needs, to quit working and I want to be able to let her do that by making at least a sustainable income.

So with nothing looming, I have an open slate, but only a few grand to use towards finding new business. This is not quite like a guy who quits his job and starts his own business since I have business experience and some decent references. Last year we did about 600K, paid off everything, and now can go any direction we want. So how do we do it?

The references we have are good but not enough of a customer base to mine for additional business. I do absolutely no marketing right now since we lived off of referrals. I am, though, in the process of developing a simple web page and investigating Adwords targeting the Project Rescues side of our business. I am considering purchasing some zip code targeted mailing lists and sending a personalized letter about our work.

So who has the roadmap to success? Just kidding, but what are your suggestions when one has an open slate like this? Where would you start? I don't expect jobs to just fall into my lap, (would be nice), and I am willing to do whatever is necessary to start over.

I sincerely dislike what I call 'carnival' approaches to my business. I am not the type to have my logo include a cartoon guy hammering a board, nor do I want to try the "Billy Mays" approach to getting customers. I have always tried to stay on the upscale and classic approach to business. Our target market is the Northern Virginia area with high incomes, expensive houses, and dense populations.

I am open to suggestions. Maybe this could help others who are using the occassion of the new year to 'start over' also either with a new approach, a new outlook, or a new business.

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I EXPECT THAT SOMEDAY I WILL SEE THE FRUITS OF MY LABOR. IS IT SOMEDAY YET?
Clifton, Great Falls, McLean, Fairfax Station, Manassas, Virginia Renovation Contractor

Mike Finley

I don't really see the problem other than you fell for the same crap others did and picked the low hanging fruit for years.

Don't take this the wrong way, but a REAL business advertises. (I know, here come the comments about word of mouth and all that stuff, well that's all well and good except most of the word of mouth guys are now in your boat)

So there is no problem, just welcome to the real world. Set aside part of your profits like any other company does and reinvest them into advertising. This is a no-brainer in every business out there except construction, for some reason construction people think advertising isn't part of their business. Obsiously as you can now see it is.

A few thousand won't be enough, you're starting now in the worst possible time to start advertising. Advertising is expensive and it takes time to figure out what has the best return based upon what you do and who your customers are, what your competition is doing and where your local market is.

From your situation you described you should be able to pump $10,000 or more into your business, start advertising and see what works, change it, do some more, see what works and so on. Just keep in mind that right now you are going to have to spend probably 3x what is normal to bring in the work right now.

You asked for a road map to success, that's it, simple, very easy - you have to spend money to bring in work, and right now a lot of money.

jazzbone

I did the same thing 2 years ago, paid everything off and now wondering what to do , so far I'm taking it slow little job here and there and waiting to see when things start moving up, after so many years of working 10 or 12 hour days it's hard to slow down

Mike(VA)

Mike, I agree. I coasted by on referrals for a long time. Even saw the downturn coming but with plenty of work at the time, my shortsightedness kept me from advertising so that there would be some work now. I am not looking for sympathy, criticism, or admonishions but I can handle whatever. I admit my lackluster performance to date and I guess my only excuse is that I've never lived through a downturn as a business owner. I have now.

I know I have to advertise. I have been reading past marketing threads to pick up tidbits that may be helpful. As I said in the OP, I am starting to have a webpage put together and will try Adwords. It is just such a slow day that I have time to think and get into trouble.

Ok, I AM looking for a bit of sympathy but only because its too hard to me to feel sorry for myself. I guess I can say now that no one is getting in my way but me.

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I EXPECT THAT SOMEDAY I WILL SEE THE FRUITS OF MY LABOR. IS IT SOMEDAY YET?
Clifton, Great Falls, McLean, Fairfax Station, Manassas, Virginia Renovation Contractor

jazzbone

I have been getting in my own way for years I think things will get better eventually, all my work the past 12 years have been word of mouth or friend of a friend so i'm a little nervous doing work for just anyone, lot of business's going under right now I don't want to get in to deep, I guess I'll just keep doing little stuff for now and ride it out

WarnerConstInc.

I don't really see the problem other than you fell for the same crap others did and picked the low hanging fruit for years

I like that mike, I have been stuck in the middle of the tree, the ones on the top seem to be a little fruity even for me!!!

I have finally seen things cool off a little bit here, thank goodness I work closely with a real estate company that manages 65+ rentals.

There is always something that needs to be done one those things, all the way from swapping out dishwashers and the like to roofs, kitchens and bathrooms.

Now I am doing emergency calls for a big insurance restoration company as well, and might be getting back into actually some full scale projects for them, it just depends.

That is one thing that keeps me going no matter what!!

Mike Finley

I'm not coming down on you, you're not any different then 90% of our peers.

You've got it even harder because I suspect you've never pushed as hard as you might have to since you have had a safety net to fall back upon. Back when I was in sales the managers loved it when salesman went out and bought a big boat, a more expensive house, a motorcycle or other toys, you see they knew there was no better motivator then to have bills to get a salesman to hustle. With your wife's high income to fall back upon you have probably never had to hustle.

Also, those of us with businesses that are advertisers have most likely if they are like us have been adjusting their advertising and marketing on a regular basis during the last 6-9 months as the economy has changed. We keep careful track of marketing and sales results and I have seen certain cycles form over the last 9 months.

We had the guys falling out of new construction flooding the market desparate to do work for nothing just to make a pay check.

We have had the large poorly run competitors facing extinction and doing whatever it took to keep bloated crews working which meant selling for nothing.

Now we are seeing most of those guys gone but the new wammy is the homeowners hording money and not wanting to spend it right now.

We have had to weather all that and have adjusted marketing all through it. It's a continuous dodge and weave, trial and error approach.

Now for a guy to wake up at the end of December and realize he can't continue to wait anymore and have to jump into advertising himself cold turkey, that's going to be a super bitch.

Recessions are shake outs. You said you haven't weathered one before, so let me just tell you that recessions are shake outs, the strong run businesses go into survival mode, the mediocre ones are a crap shoot whether they make it or not, usually there is a good dose of luck or extenuating circumstances that will be attributed to their survival, the poorly run go away.

You might go away. The odds are stacked against you this late in the game.

Take a hard look at your self and your business. There is no shame in taking your army off the battlefield in a good enough condition to be able to field it again when conditions are better. What is much worse is continuing to fight on with no hope of victory and destroy yourself with debt.

One last piece of advice - the internet and adwords and all the inexpensive or gorilla marketing methods are only part of the answer and only a small part.

In these times traditional mainstream marketing is what pays off quickly and instantly. All the other stuff is not going to jump start you. Most guys deny this and will struggle through all that other stuff and slowly die as they see it won't bring in the work.

That's why I said you'll need a big cash infusion to start bringing in the work. Traditional advertising is what works during times like this, however it's expensive and unforgiving, it eats up ad budgets of those with little experience with it.

You have a very difficult road ahead of you. I would give a hard look at all the alternatives that you have. Keep reading though the forums here there is a lot of good information.

silvertree

I'm in a similar position, but my house isn't paid off. I'm spending money to get my name out there, as Mike says the low hanging fruit is gone.

You do have the resources to promote yourself financially, because according to your posting the wife makes enough to support the both of you. If you aren't willing to start an ad campaign, then you better network your ass off because all your competition will be spending money to acquire the customers you will need. How you choose to do this is up to you. Welcome to the new economy which will be a better smarter place to be in the future.

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Vote for Pedro
Kitchen, bath, St Paul remodeling
Minneapolis Remodel Blog
203K Loan Consultant Minnesota

Ivinni

Smart man. Ride it out without debt and get ready to gain as much market share as is possible when the market returns.

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its not going to get better with straps, or new footings or even aroma therapy.

pcplumber

You must have a customer base of some type. You must go through every invoice and estimate, and start creating a mail list. Even if you come up with only 200 customers, you have to start somewhere, and my software is great for making your list.

Contractors, being slow, remind me of the people, who sold buggy whips, before cars became popular. You have to be able to change your product and adapt to the market.

You may not be enthused about changing services you are familiar with, and feel other services are not your 'cup of tea', but maybe you will become more enthused when you find it is more fun to be an entrepreneur than a worker-bee. Don't misunderstand. I still work in the field no less than 8 hours, every day.

I will always say, if I were to go to any metropolis, and start brand new, with only a few thousand dollars, I would have a great business, earning a great profit, within a few weeks. The only way this can be accomplished is with brochures (flyers). Thousands and thousands. There is no other advertising media that will jump start a business like thousands of brochures.

Since you are already in contracting, the most simple and profitable trades are plumbing, heating, roofing, painting, windows, and water damage restoration. These would be my only choices. Water damage restoration is more difficult to get with brochures. To see how we do brochure campaigns, see my manual, if you have not, already.

If not licensed in these trades, try to hook up with someone who is.

I always test the water before setting up a business. If you want to do painting, print 100,000 brochures and send them out. Wait a few weeks, to see the response. Then, get excited and figure out how you are going to get the workers, and get the jobs done. Once you have the leads, you will figure a way to get the work done.

mark the coach

Hello Mike
Congrats on getting back to the remodeling business.
Like any business start with the basics. I am listing a few things you probably already know about so just disregard if you do.

Have you put together your business plan?
What are your income goals?
Insurance, licensing, office, office staffing, subs and suppliers with lines of credit.
Consider joining NARI. Great resource to find subs and talk to professional contractors.
Join the local chamber and network at business events, join a referral group like BNI.
Go to PCPlumbers post and study his program on fliers, he is right on.
Develop a strong marketing plan.
Develop a sales process. If you are doing design/build align with architects and designers.
Develop strategic alliances with kitchen and bath showrooms.
What is your sales approach? Do you need to read up on sales or take sales training?
Personal development for goal setting, positive thinking.
Re-connect with old customers and business contacts.
Re-search your competition.

Good books; Mike Gerber, E-myth contractor
Design/build remodeling by Linda Case (several books)
Michael Stone, "Markup and Profit"
Napoleon Hill. "Think and Grow Rich"
Dale Carnegie, How to Win Friends and Influence People

Good luck

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mark the coach

FENCETECHS

I am just like you, with a couple exceptions, my wifes plant closed, my house is not paid off, up until with in past 2 months we had a waiting list. All three of my business are related o housing market. So I finally figured out Failure is not Fatal, but failure to change could be. So once again, I am doing the reconnecting with every prospect, tire kicker, and past customers, with emails, phone calls, and post cards. I do not have the money to put in ads, espically since we have a weekly newspaper, I do have one advantae over most people in the State of Georgia, Ihave a vinyl Sign machine. S I have put out over 50 what I call Yard signs and 12 ea 4 x 8 signs, which I would have never done if I had not let my self fail after 30 years in business