Storms are seasonal, but payroll is not. If your company relies on Storm Damage Restoration as your primary source of revenue, how do you prepare for the months when there are no storms? How do you get work and maintain customer relationships? The same goes if your business slows down during the winter or has its own “season.” If you don’t have a plan for life after storm season – and be working on that plan throughout the year – you could find yourself in a situation that jeopardizes your business.
Know Your Monthly Overhead
First and foremost, you need to know your business costs. How much does it cost to operate your business each month? If you know that your overhead is $10,000 per month, and business comes to a halt for the winter season where you work, that’s a helpful figure to have so you can plan for those costs during the busier seasons when you generate more profit.
Now, go back into your books and check to see what your revenue was like during the lean, post-season months. The trick is to take the extra profits you make during the storm season and save enough to make ends meet during the post-season months.
Keep Your Operations Lean
The less overhead you have to start with, the easier it is to maintain when sales decline. If you’re a regular reader of this blog, you know how strongly I advocate for keeping your overhead low by automating your workflow and company processes. If you’d like to learn how I keep my 7-figure business down to one Admin and a 1,00-SF office, just give me a call.
Assess Your Job Cycles, Job Types, and Lead Times
For many contractors who have lower overhead, you may be able to schedule jobs out a bit longer leading into the slow season in order to “extend” the busy season. Or you can schedule specific types of work for off-season months. For example, maybe you do roofing and siding when it’s warmer and you switch to running interior trim or flooring when it’s cold outside. If your customers are flexible, this is a great way of compensating for slower months.
Use Marketing Strategies BEFORE The Off-Season Hits, Not DURING It
If you’re lucky, marketing efforts will take 30-60 days to ramp up and start generating leads. Sometimes, lead time can be 90 days or more. Starting a marketing and advertising push in December is likely not going to be fruitful until February. Go back and study your previous campaigns and see how long your sales pipeline averages from lead generation to close. Again, read that carefully: lead generation to close – half the time spent in a marketing campaign can be just generating the lead. It’s critical to plan accordingly if you use marketing and advertising campaigns to sustain your lead flows.
Consider Offering Discounts
No one wants to take a cut or reduce their margins, but sometimes it’s necessary. I’d never advocate becoming “The Discount Contractor,” but offering seasonal price adjustments to gain more business makes sense. It’s smart to use widely-accepted discount opportunities to help keep your brand intact: recent examples include Black Friday and CyberMonday. You’ll also find a lot of Labor Day and President’s Day sales. Those sales are expected by your customers, so taking advantage of them won’t affect your brand.
Solicit Your Existing Customer Base
Ask for the sale, right? Any salesperson will tell you that. There’s no harm in approaching past customers who’ve used your services to see if there is additional work they require. A smart salesperson will note deteriorating cabinetry when he’s in a customer’s residence to check out window replacements, and then call back later to see if they’re looking to replace their cabinets.
Create Incentives For Your Sales Team
You’ve got a team of money-hungry salespeople working for you – let ‘em loose! Use incentives that motivate them to go find more work. We plan our Quarterly and Monthly spiffs around sales projections at different times of the year. It’s a very deliberate way to focus the team on sales during months when closing deals are most difficult.
Plan For It
Sounds simple, but it’s the most important idea. Unless this is your first year in construction where you work, you have some idea of seasonality in your market. Even then, most people can deduce you’re not going to be doing as much roofing in Upstate New York in January as you might be in August. Take the time to sit down with your leadership team and organize a plan for the year that includes sales projections. Get input from the frontline part of your team and budget for those months before they happen so that you can survive them. If business planning seems foreign to you, that’s alright, we can help! Let’s talk!