Name your most profitable jobs

Many construction business owners lose their focus on what is important. Their only goal is to keep jobs flowing through, pay some bills, and keep the guys working.

Their approach is, “We’ll take any job as long as it helps pay the bills.” That is no way to live, and it will cost you money.

I’d like to suggest another approach. The companies in this industry who make good money focus on one thing they do well that is also profitable. Far too many companies are like bad news and manure; they are all over the place with the types of jobs they do. And, as might be expected, their profitability is all over the place as well.

If you are ready to focus on profitable jobs, you first need to sit down and do some hard thinking.

• Who is your perfect customer? Write out, pen on paper, a clear description of the customer you want to have.

The more information you write, the clearer the picture. Are they male, female or either? How many children? Where do they live, shop, recreate and play? How many pets do they have, where do they keep them? What kind of cars/vehicles do they drive, color/make and model? Where do they work, for how long, what is their income?

The more questions you ask and answer, the better is the picture of the perfect customer.

Next, look at yourself

When you know your perfect customer, you need to figure out your perfect job. Sorry, this is not about what you like to do. This is about the job that earns you the most profit.

• What type of work gives you a profit percentage clearly above and beyond anything else? That is where your focus needs to be.

As a side note, I want to add something I’ve learned through experience. One of the mistakes many contractors make is trying to do too much. They advertise themselves and their companies as being able to do every type of work imaginable in hopes that it will attract some jobs.

Look at their advertising. They specialize in over 30 things. Gang, that’s not specializing. The buying public today is smart enough to know your company can’t do everything well. You can’t be all things to all people.

The buying public is willing to pay specialists more because they know that a specialist can do the job better and quicker. In some cases, those specialists can do the job for less money than a common practitioner because they are more efficient and have specific buying power. So let’s focus on being focused.

Define your perfect job

Without realizing it, most companies have one thing that they do very well and make good money on. That’s called a perfect job, and you need to find yours. If you have been doing a good job of job costing, you will already have that information at hand. If not, then you have some work to do.

Often, there will be one or two other things you do that are not quite as profitable, but they help bring in the bacon and keep the bills paid.

Let’s say you do very well at building pole barns in the 30- by  50-foot to 40- by 60-foot range. For some reason, the jobs you have taken that were smaller have cost you money. And there just isn’t enough of a market for buildings larger than that, maybe one or two a year. That’s your perfect job.

However, in checking your completed jobs, you find out that in addition to the “good size range” for your buildings, you have built smaller lean-to additions with shed roofs. Those jobs were also profitable and many times they led to even more work from that customer.

You now know your perfect job #2. Yeah, baby, we are on a roll here.

It’s a match!

Hopefully, your perfect customer needs your perfect job. If your perfect customer lives in the suburbs or in a neighborhood with restrictions on outbuildings, you need to redefine your perfect customer.

It’s important to know who your perfect customer is because when you advertise, you need to know to whom you are talking.

So now, with your perfect job and perfect customer in mind, you know how and where to focus your advertising.
Your advertising clearly says, “Here’s what we do better than anyone else in the area. Not only that, we do it on time and we do it at a fair price.”

Hammer that theme in all your advertising. Talk about it to all your customers, making yourself the Contractor of Choice for 30- by 50-  to 40- by 60-foot buildings or lean-to additions. You’ll become the Contractor of Choice because you address the customer’s three basic fears in all your advertising. I cover this at length in our book, “Profitable Sales, A Contractor’s Guide.” Feedback shows these principles work well.

It won’t happen overnight

Yes, it will take time for the buying public to recognize you and your company as the Contractor of Choice for that type of work. It may take up to a year or more before you start seeing steady results from your advertising.

At some point, however, that message will register with the buying public. When it does, you will be the contractor they call when they want your type of work. When that happens, you will be able to charge more than the competition for the exact same job and you will still get the lion’s share of those jobs. That’s because you are the expert.

Here’s another very important point about being specific in what you do. If you have a web site, as you should, your web site will focus on those one or two things you do well. When people go looking for your type of work, the more specific you are, the easier it will be for them to find you.

Your site doesn’t need to be big and flashy. It does, however, need to tell your story and make sure you can be found.
An article on our own web site, www.markupandprofit.com/how-to-get-a-website.html, lays out the basics on what is involved in getting a web site together.

We don’t build web sites; we aren’t selling those services. We just want you to have a web site because it’s part of your success in the modern business world.

Getting a web site put together isn’t magic; it’s very doable and it doesn’t have to be expensive. If you don’t have one, now is an opportune time to start.

Wayne Gretzky, the great hockey player, once said “You miss 100 percent of the shots you do not take.”

I can assure you that, unless and until you give this approach a try, it won’t work. If you don’t focus, you will always be left picking up the scraps left behind by the focused companies.

That’s a tough way to live.

Michael Stone, business coach, speaker, consultant and management trainer, has more than four decades experience in the building industry. He wrote “Markup and Profit: A Contractor’s Guide” and “Profitable Sales: A Contractor’s Guide.” Stone offers business management assistance to construction-related companies throughout the U.S. and Canada with audio and CD programs available on his web site, as well as coaching and consulting services.
He can be found on the web at www.markupandprofit.com and can be reached by e-mail at michael@markupandprofit.com or by phone at 888-944-0044.

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