Time was when I sat on a roof, replacing shingles, working my eight, ten or twelve hours a day, watching the boss pull up in his beautiful new truck and leaving after twenty minutes. I knew then that I wanted to be the boss and have my own contracting business. Starting it wasn’t easy, but it didn’t take a Harvard education to get it done and eventually have more work than I could handle.
The critical question was this: when was the right time to take my roofing business to the next level? How would I know when the time was right? I was a one-man operation, in charge of everything. People liked my services and referred work to me. It sure seemed like I could grow what I was doing. But what I didn’t know then was that if you have a business that requires you to be at every job – if you are still working every weekend just to catch up and head back to your desk after you put the kids to bed – it’s probably a hard NO that you are ready to grow.
In contrast, if you have an effective team that is able to get jobs done with little oversight, effective systems and processes to allow you to follow up on them, and the ability to take on more work without considerably increasing overhead, the answer could be YES. Once you’ve established a need in the marketplace and verified that your concept works, start working your way down the following list of important questions. If you answer “no” to any of them, you may need to make some adjustments before considering growing or expanding your business.
Is there a market in which to grow your business?
If you operate in a major metropolitan area and are considering expanding out another 20 or 30 miles then this may be an easy answer. But it could be more complicated if you are considering opening a satellite office away from your main operation. Satellite offices require a business infrastructure that allows you to stay in constant communication with your team in the other city. Without that structure in place first, you could be asking for headaches.
Do you have time-tested processes and systems for Sales, Production and Back Office?
And just as important, have you designed them with room to grow? Can they sustain more?
At this point, you may be saying to yourself, “Joe, why do I need all this stuff in place first?” The reason is, you need to plan for success. You need to grow your business with the assumption that you will be taking on more clients and will be doing more work. If you don’t have the structures in place to handle that extra work load, your services and job performance will suffer, which means your reputation will suffer, which means you’re dead in the water.
Do you have technology that allows you easy oversight of your operation in the form of reports or data?
We use JobNimbus as our CRM of choice and it allows us to easily add markets, new sales reps, project managers, and partition our data so that the right people can see it. If you don’t have a CRM or the one you currently use is limited, word to the wise is to get this squared away BEFORE you look at growing.
Do you have the resources necessary to grow your business?
And by resources, I mostly mean cash. Consider the operating costs in a new market for a moment: rent for a small office, a salary or bonus structure for someone to run it, perhaps some ladders or equipment for that market, maybe some advertising and marketing. Even on the cheap, you could be looking at $30,000 to $40,000 in costs. Look at your annual budget for your current operation, then calculate how much it will REALLY cost you to start that new office.
Do you have the time?
For a lot of business owners, the idea of reaching the top of the mountain includes the freedom of time. Not being enslaved by your own company and at the mercy of your customers. You’ve taken the time to build something that works without your constant involvement and oversight, and still provides you a living. For some, that may be enough, but for others (and I’m guessing you’re part of the “others” here) it’s never enough. We need to see how far we can go, how fast, how high.
Most often, success doesn’t come without a substantial investment of time. If you have achieved success without fully letting go – perhaps you still get phone calls every day from field managers or your administrative staff – growing to a new market could make you go crazy. Successful time management can be as much art as it is science, but it’s a mission critical component of entrepreneurial success.
Here’s the good news. If you answered no to any question on this list, we can help you! AJCEO offers turnkey operations services that can build out your CRM, help you define and manage your processes and even run the day-to-day of your business while you focus on growth. Give us a call and see how we can help take your contracting business to the next level.