The buzz is to “get involved.” If you want community recognition, to be considered a “real player” in business or a “team player” in the community, you need to help others — the poor, elderly or victims of disasters. You hear that if you do these projects, you’ll get great press, awards and new business.
The truth is, you probably will receive great press, as well as accolades and awards. But few contractors I know can tell you how much business they gained by getting involved in giveaway projects. They don’t know if they received any additional work. Unfortunately, many even say, “Never again.”
Now, don’t jump ahead and get angry with me. Contrary to what some claim, I am not a curmudgeon.
But let’s stay focused on the facts.
Will you gain recognition from doing a community service project? Probably.
Will you be able to help others? Yes, and that’s important.
Will you and your staff have the satisfaction of knowing you did something positive? Absolutely.
But don’t deceive yourself into believing it will generate more work for you. Do it for all the right reasons. Don’t do it to get more jobs and make your business more profitable.
There are a few questions you need to ask before you jump into a project on which you have little chance of making a profit, especially if one of your reasons is to attract more business.
• How many new, profitable jobs will this generate for your company? And how many of those profitable jobs will it take to pay for the giveaway?
• Can you or should you ask your employees to donate their time? How about the gas for their vehicles to get to the job site? Who provides the meals while they are working on this job?
• How much will the materials and equipment cost that you will be donating to this job, the saw and/or router blades, the nails, screws and other fasteners?
• When does the job start? What is the schedule? Can you do the work after your normal work day and on weekends, or will you be expected to work on it 8, 10 or 12 hours a day until it is complete? How will that impact other jobs you have working?
And the really big question
And here is the biggest question of all. Can you afford to take on this project? Have you looked at all aspects of the job, weighed the considerations and calculated the actual costs you will incur, including your overhead?
You will have overhead expenses. Whether you are working on a paying job or a volunteer job, the meter keeps running.
I am all for helping others if the need is there. I would be first in line to help a wounded veteran and his or her family to make their home more livable and safe.
I have served on our church building team for over five years now, contributing countless hours and a bunch of money to the project. I knew before I started what I was getting into and about what the cost would be. So far, no surprises.
What does it really cost?
The question is, have you counted the cost before you jumped in to help on a job for others? If you do a thorough analysis of the jobs you have worked on, including calculating the returns received, you may find it’s smarter to pay for your advertising and save your volunteer work for your own home.
If someone calls and wants you to help with a project, and it makes financial sense to do so, go for it. But that is seldom the case.
You see, it is one thing to work for someone else and volunteer your time to paint someone’s house on a weekend. All you are providing is a warm body to push the paint roller.
It is another matter altogether to coordinate the job, get the manpower together, furnish the materials and make it happen. And that is usually what is expected of a contractor.
Show a positive face to the community. Give a half a day here or there. But think long and hard about assuming you will gain business by building free jobs.
I have been in this business for over 50 years and I can count on one hand the jobs I have seen awarded to contractors as a result of jobs given for free.
If you want new business, there are better ways to spend your time and money. In the current economy, you have to do a better job of advertising to gain access to customers who are ready to pay to have work done. If you’ve increased your advertising over the past year, as I’ve been advising, you should be as busy as you want to be.
Instead of working for free for others to gain new leads, spend your time and money on advertising to keep your name in front of the buying public. That’s how you will reap the rewards, and those rewards are profitable jobs.
Michael Stone is the author of two contractors’ guides, “Markup and Profit” and “Profitable Sales.” He is available for speaking engagements. Reach him at 1-888-944-0044, or michael@ markupandprofit.com.