9 Stupid Things Contractors Do In Slow Times
Originally published: 01.01.12 by Ruth King
Peaks and valleys are part of business, but you can manage them for better performance.
Over the years I've seen contractors do some really stupid things — both in slow times of the year and busy times of the year. Since it's January, I'll cover the stupid things I know you, the smart contractor, won't do in the upcoming slower season. Fear not, I'll cover the stupid things I know you won't do in July, the busy season for most contractors.
Here are nine stupid things contractors do during the slow season:
1. Paying overtime to office personnel. Your employees expand the time it takes to do their jobs in slower times so they can ensure 40 hours of work or more each week. They got used to the overtime hours and dollars in the busy season, and they want to continue that cash coming in.
In slower times there are fewer billings, fewer phone calls, and less work needed to support the field personnel. Employees will slow down. They'll surf the Internet, play games, and do other non-work activities — that you get to pay for — in addition to getting their real work done. Employees will stretch the time it takes
2. Paying overtime to field personnel. With the exception of the technician on call (maybe), no one should have overtime hours. In slower times of the year, your field personnel should get their work done in a regular, eight-hour day. Overtime should not be necessary. Be clear (in slow times and busy times) how many hours were bid for the job they are working on. Remind them that the job has to be completed in the estimated hours. If they run into a problem, they are to call their supervisor immediately to resolve it.
3. Telling the technicians how many calls they have each day. If they know they have two calls that day, those two calls will magically take three to four hours each. When a technician asks how many calls he has, the answer is "enough." If he asks, "How many is enough?" The answer is "enough."
4. Not telling the technicians how much time they have to complete maintenance checks and warranty calls. If they don't know how much time they have to complete the calls, and they sense that it is a slower time, they will stretch the time on each of the calls. A two-hour maintenance call somehow takes four hours. They will stretch the time to ensure they get 40 hours per week.
5. Not implementing new software/hardware or procedures. The slower times of the year are the best time to install new procedures, hardware, and software. Field personnel have the time to "play" with the new devices and get used to them before the busy season. Likewise, it's easier to get used to new software and procedures in slower times. You have the time to ensure they are being performed correctly.
6. Not training. Even though training dollars are not revenue-producing, this is the best time to train on technical and customer-service issues. Office and field personnel have the time to absorb and implement the information.
7. Refusing to hire a great employee. You never know when a great technician, installer, or office person will walk in your door. You have to hire the employees when they are available, even if it is a slower time of the year. What do you do with that person? First, test him out with the calls or installations you have. Then, assuming that person is "great," find the weakest person on your team. This person gets the least hours. Mean? Perhaps. But, I've seen long-time employees leave simply because they think "the grass is greener" or they get an offer from your competition. Or, they don't like a change in policy. Why shouldn't you build the best team you possibly can?
8. Spending a lot of marketing dollars trying to get new customers. This is the wrong time of year to do this. People don't need heating or air conditioning, so they aren't looking. Should you continue to market to your existing customers? Of course. However, trolling for new customers is a waste of marketing dollars.
9. Complaining or worrying about the slower time of the year. Our business is seasonal. We have busy times and slower times. If you want shorter slow times, then build a great maintenance-agreement program. But even with maintenance agreements, you still will have peaks and valleys.
By avoiding stupid things in slower times of the year, you'll be poised to take advantage of the busy times of the year.
Ruth King has over 25 years of experience in the hvacr industry and has worked with contractors, distributors, and manufacturers to help grow their companies and become more profitable. She is president of HVAC Channel TV and holds a Class II (unrestricted) contractors license in Georgia. Ruth has written two books: The Ugly Truth About Small Business and The Ugly Truth About Managing People. Contact Ruth at firstname.lastname@example.org or 770.729.0258.
Articles by Ruth King
Your Receivable Days Ratio: Do you have a Collection Problem?
Your Compensation Percentage: Are Your Employees Productive?
Even if liquidity ratios are stable or increasing, showing increasing profitability, compensation percentages may show a different story. If compensation percentages start to increase, there’s a productivity problem.
Understanding Profit and Loss Statements
3 Easy Ways to Improve Your Bottom Line
Increase Profits Without Price Increases
One of the toughest things owners and managers have to do is to productively manage a labor force. But companies that manage their labor and their inventory effectively are among the most profitable.