You’re Headed Toward Your Goal — Continuous Profits are Critical
Originally published: 04.01.19 by Ruth King
You’ve launched. You are tracking your progress each month by looking at your financial statements. It’s the slowest time of the year and your profit and loss statement is showing losses.
And, your balance sheet current ratio is declining from month to month (current ratio is current assets divided by current liabilities). Should you be worried?
Many contractors believe and accept that the first quarter is a loss. Then, they spend the rest of the year scurrying to make up for that loss. If the summer is not hot, then the year is a loss.
But, what if you ddn’t lose money in that first quarter or at least broke even in the first quarter? That would make a great start to your year and your journey toward your goals.
Your maintenance clients are the most likely people who will pay attention to your marketing messages at this time of year. They trust your company.
You have helped them experience decreased utility bills, more comfort in their homes and offices, etc.
No one else is paying attention since there isn’t a need for your services — it’s not hot and it’s not cold.
Here are seven ways to help your first quarter be profitable or at least break even:
1. Call your maintenance clients who have not renewed their maintenance plans and didn’t have a heating check. Give them a reason to get it done.
2. Call your customers who have had maintenance checks in the past who are not on a maintenance plan. Give them a reason to have a heating check and to join the maintenance plan.
3. Make a list of all of your maintenance clients and customers whose systems are 10 years old or older. Have a furnace sale. Send them a letter with great reasons to purchase now.
As you do this from year to year, people will begin to expect that they can get great deals on systems at this time of year and will begin to wait until the sale if their system is not broken.
4. Choose a day during these three months to have a sale and let your customers know about it. Some contractors have White Sales, others have “I Love my Customers” Valentines Day Sales, and still others have St. Patrick Day sales (great for Irish owned companies).
These sales usually generate significant sales and cash flow to break the “we lose money in the first quarter” cycle.
5. Have an open house. In slower times of the year, you can “take a long lunch” and invite your clients to a Customer Appreciation Day.
They can meet your employees, have lunch, and potentially win door prizes. It’s also their opportunity to see, touch, and ask questions about system efficiencies, indoor air quality products, etc.
If you are like most contractors who hold an open house, this event produces leads and revenues throughout the year.
6. Go through your tickler files. Assuming that your technicians have recorded everything they proposed and the customer said not at this time, you have a list of potential work to do.
Call the customers and get the work done. Some will not want it done. Others will say yes and appreciate that you are thinking about them. You might give them a discount for performing the work during this slower time of the year.
7. Watch the weather. Do not spend money on pay per click advertising at this time of year unless the weather dictates it. People will start looking when the weather gets really hot or cold. Turn it on and turn it off depending on weather.
Make sure that when your technicians are performing maintenances, especially commercial maintenances, they know how much time they have to complete them.
Many times they stretch these times because they sense they do not have much to do that day. This decreases your profitability on those maintenances.
One of the biggest keys to having a break even or profitable first quarter is your attitude. If you sit back, do nothing, and say, “That’s the way it is,” then you will get what you expect. When you plan activities, contact your maintenance clients and customers who have used your company in the past, and execute those plans, you have a greater chance that the first quarter will be at least break even.