Posted by Mark Paskell on Tue, Dec 30, 2008 @ 09:01 AM
Owning and operating a residential contracting business presents unique challenges for contractors servicing the homeowner market. These challenges are unique because the industry has very little structured business training for residential contractors who provide services to a savvy, demanding and educated consumer. Contractors with formal business education or experience from the commercial construction industry tend to do better with today's homeowner consumer if they use and apply, industry best practices and systems.
If you are a residential contractor, who learned from the school of hard knocks, you are discovering that practices and methods that worked a few years ago don't work as well or at all, with today's new consumer. If you are formally educated on how to run a business, are your practices and methods aligned to work with today's new consumer?
As you finalize your business plan for 2009, ask yourself the following question and please share your insights with the readers by responding to this blog post.
What do you think are the top 5 challenges facing your residential contracting business?
P.S. Next post, 11 challenges for today's residential contractor.
Posted by Mark Paskell on Sun, Dec 28, 2008 @ 07:53 PM
I wrote a post a few weeks ago about writing your business plan for 2009. How are you doing? We have a few more days until the New Year, will you be ready?
We met a contractor two weeks ago who is struggling with his 15 year business. and was curious if he used planning and goals for his business. We asked him if the results from this year matched up with his business plan and goals set at the end of last year. He replied that he always has his plan and goals in his head, he never writes the plan or goals down.
It is not uncommon for contractors to omit writing a business plan. Many contractors fell into the business with little of no business training. Many residential contractors will tell you they come from the school of hard knocks and that is all the training they need. Some have even told me they are hard headed and don't like change!
Unfortunately, this does not bode well for residential contractors who fail to plan. The residential homeowner is more savvy, educated and concerned who they invest their dollar with to work on their most valuable shrinking asset. A business without a plan will have a difficult time surviving in the new economy. Life and business are too confusing and hectic to try to navigate the waters without a clearly defined destination and a plan to get there.
One of the major fatal mistakes of residential contractors is the failure to write a basic business plan, set goals and define their strategy. Contractors with formal business education or commercial construction experience seem to be more likely to write a business plan and use goals, however this is not always the case.
For those contractors who have not written a plan there are several ways to learn how. It does not need to be perfect, just effective at describing what you are going to do and need to do, to reach your goals. You can research online, buy a business planning book form Journal of Light Construction book store, go to Borders, Amazon.com, go to the library, ask your CPA, hire a contractor business coach, join an association like NARI, NAHB, seek out a mentor, go to SCORE, and go to contractor forums to learn form other contractors.
Now that you know where you can go to obtain information on how to write a business plan will you do it?
A basic requirement of building a successful business is developing and writing down a business plan and goals. If you doubt this, ask 5 of the most successful people you know and convince yourself.
In December of 2009 when I meet you and ask how do your results of year 2009 match up with your business plan and goals you prepared at the end of year 2008?
What will your response be?
mark the coach
Posted by Mark Paskell on Fri, Dec 26, 2008 @ 04:07 PM
First a bad economy and now residential contractors have to contend with the media portrayal that contractors never show up when they said they would? Can you believe it?
Thanks USA Today!
What do you think about this cartoon and homeowners' perception of residential contractors?
mark the coach
Posted by Mark Paskell on Wed, Dec 24, 2008 @ 11:47 PM
It's been 10 months since I started my contractor coaching business for residential contractors. I am grateful for all the support from business associates, supporters and most of all the many contractor clients who hired me to help them with their businesses. I consider coaching you an honor.
As I look back at the business plan I put together in 2007 it is interesting that many of the goals I wrote down and went after have been realized.
Believing that you can accomplish specific goals and putting an action plan in place has yielded a viable niche business. I truly have realized a dream come true. As Earl Nightingale says "you become what you think about".
As the year comes to a close before you know it, we will be thinking about New Year resolutions. I will be working on mine after the holiday when my business plan for 2009 will be refined. The plan will be reduced to writing and backed up with goals that will be measured and tracked. I will again use the principles of thinking right as taught by Napoleon Hill in "Think and Grow Rich" . He says "what the mind of man can conceive and believe it can achieve"
How about you?
Have you done your plan for 2009?
After the holiday is a great time to start if you haven't.
My wish for you today, have a Merry Christmas and thank you for all the support and encouragement you have given me throughout the year.
mark the coach
Posted by Mark Paskell on Tue, Dec 23, 2008 @ 09:27 AM
Recently members of my Linkedin network formed new business networking groups. The quality of the individuals and companies represented are stellar. Members of the groups include architechs, designers, kitchen and bath contractors, general contractors, remodelers, manufacturers', and other professionals with ties to the residential construction industry.
These groups allow members to pose questions about their business, their industry, marketing, sales, consumer trends, what's going on in a specific area and how to obtain useful information to solve problems.
This is a simple cost effective way to network with industry professionals and become known in your industry. Following is a link to the groups.
The groups are Architect, Professional Remodeler, and Home Remodeling Sales. Come join us and stay informed on topics effecting our industry. Better yet, come join and ask us a question about a challenge you currently face. The members may have the answer to your challenge and your only investment will be your time!
http://www.linkedin.com/groups?gid=1507177&trk=hb_side_g
mark the coach
Post #4
Posted by Mark Paskell on Mon, Dec 22, 2008 @ 04:30 PM
Recently a Contractor Talk.Com member referenced a new EPA fine assessed against a Massachusetts contractor. This new rule is another regulation to contend with. If you are residential remodeling contractor working on homes built before 1978 they are subject to the lead paint notification rule.
The article;
Release date: 09/22/2008
Contact Information: David Deegan, (617) 918-1017
(Boston, Mass. - Sept. 22, 2008) - A Medford, Mass. residential renovation and construction contractor will pay a cash penalty of $63,832 for violating the federal lead paint disclosure law that applies to renovations of residential housing.
An EPA inspection found that M.F. Reynolds Inc. of Medford violated the federal Pre-Renovation Rulethat requires contractors to provide lead hazard information to 121 owners of pre-1978 residential property 60 days prior to the start of renovations. The requirement for contractors to notify residential customers about lead hazards prior to renovation work is recent. This case is the first pursued by EPA within New England, and is one of the first cases nationally.
Common renovation activities like sanding, cutting, and demolition can create hazardous lead dust and chips by disturbing lead-based paint, which can be harmful to adults and children. Contractors and renovators are required to provide an EPA pamphlet to residential customers 60 days prior to renovation work. The pamphlet provides information on the risks associated with lead-based paint and how to take measures to protect one's family from those risks during renovations or construction.
The existing housing stock in New England has thousands of older homes with lead paint. Our public officials are keenly aware that this lead paint rule may be another way to enforce compliance on obtaining permits. Building inspectors, state regulators, EPA and OSHA are all experiencing budget shortfalls and are looking for every opportunity to increase revenue.
Another point to consider is how this information can be used to differentiate your company in a positive way to help you win the confidence of an educated consumer. Educate yourself on the regulation and share this information with your prospects. This will confirm your expertness in the eyes of the homeowner. Then ask if they were educated by other remodeling contractors they are considering. If they say no, ask them if they are concerned that the other contractor didn't tell them about the lead paint rule. It may cast some doubt on the other guy and set you apart as the better company.
Finally, imagine if a homeowner hires you and discovers the rule while you are working on the house. Do you think it may present a possibility where the homeowner has doubt and can justify not paying you for avoiding the rule?
What are you doing to comply with the new lead paint regulations?
post #3
Posted by Mark Paskell on Mon, Dec 22, 2008 @ 06:30 AM
When confronted with challenges sometimes it is easier to give up than to stay focused on what we want. Some say this year has been the Perfect Storm for the American people. Yesterday's post talked about keeping and maintaining a great attitude by working on yourself and minimizing exposure to things like negative news and the media. Now let's talk about staying the course in spite of challenges facing the residential construction industry.
Today, I am sharing with you a subject (persistence) taught by Napoleon Hill in the book "Think and Grow Rich". This fine work was produced over 70 years ago. It was commissioned by the late Andrew Carnegie. Mr Carnegie's request to Napoleon Hill was that he write a book on how to become successful by studying the habits of successful men and women of the day. The book was to be written so that any average individual of sound mind and health could read and apply it to become successful if they wanted to. Rather than re-word his fine work I am quoting words from his chapter on persistence as printed in "Think and Grow Rich"
Following are some phrases as printed in Napoleon Hill's book. The concepts may seem simple and old fashioned, however they still apply to todays' principles of success in both business and personal life.
You can train yourself to be persistent
Persistence is a state of mind, therefore it can be cultivated. Like all states of mind, persistence is based upon definite causes, among them these:
a. Definiteness of purpose. Knowing what one wants is the first and, perhaps, the most important step toward the development of persistence. A strong motive forces one to surmount many difficulties.
b. Desire. It is comparatively easy to acquire and to maintain persistence in pursuing the object of intense desire.
c. Self-reliance. Belief in one's ability to carry out a plan encourages one to follow the plan through with persistence. (Self-reliance can be developed through the principle described in the chapter on autosuggestion).
d. Definiteness of plans. Organized plans, even though they may be weak and entirely impractical, encourage persistence.
e. Accurate knowledge. Knowing that one's plans are sound, based upon experience or observation, encourages persistence; "guessing" instead of "knowing" destroys persistence.
f. Cooperation. Sympathy, understanding, and harmonious cooperation with others tend to develop persistence.
g. Will-power. The habit of concentrating one's thoughts upon the building of plans for the attainment of a definiteness of purpose leads to persistence.
h. Habit. Persistence is the direct result of habit. The mind absorbs and becomes a part of the daily experience upon which it feeds. Fear, the worst of all enemies, can be effectively cured by forced repetition of acts of courage. Everyone who has seen active service in war knows this.
How to Develop Persistence.
There are four simple steps which lead to the habit of persistence. They call for no great amount of intelligence, no particular amount of education, and but little time or effort. The necessary steps are:
1. A definite purpose backed by burning desire for its fulfillment.
2. A definite plan, expressed in continuous action.
3. A mind closed tightly against all negative and discouraging influences, including negative suggestions of relatives, friends and acquaintances.
4. A friendly alliance with one or more persons who will encourage one to follow through with both plan and purpose.
These four steps are essential for success in all walks of life. The entire purpose of the thirteen principles of this philosophy is to enable one to take these four steps as a matter of habit.
I have read and studied "Think and Grow Rich" for over 25 years. The principles in the book are simple and work. The key is that you must put in the work to get the result. Now is the time to "sharpen your saw" while it is slow in the industry. The economy will rebound and the Next Level Consumer will be looking for The Next Level Contractor. The contractor of the future will be the one who has spent this down time wisely investing in himself and his business. Things you can do during the down time; read positive books, listen to cd's or tapes, sales training, business planning, marketing plan, hire a contractor coach, work on system development and more.
What are you doing for you and your business the next two weeks to prepare for next year's market?
Post #2
Posted by Mark Paskell on Sun, Dec 21, 2008 @ 02:56 PM
Over the past week many in the northeast have been walloped by the Ice Storm of 2008 leaving many without power and the basic necessities. On top of the recent economic downturn, foreclosures, declining real estate construction activity and financial troubles it is not suprising that people's attitudes are affected. We are easily reminded of all the recent and current challenges on the news, in the paper, the radio, the internet, work and the coffee shop. It is very easy to get caught up in the misery and before you know it you are not feeling very positive and your attitude towards things turns negative.
Keeping the proper perspective is vital to maintaining a positive attitude. Yes, it is a tough situation, but like all others it will pass. It is prudent and neccessary to be informed about the challenges we are facing but not smart to let them alter your attitude. The more we allow ourselves to think negatively about the bad economy or the tough winter upon us the more we attract and maintain a negative mindset. The law of attraction will not fail you. It will attract negative thoughts just as readily as it will attract positive.
One of the worst things we can do to reinforce the negativity around us is to spend too much time listening to, watching or reading the news. A good example of this is the weather. The media has become so adept at teasing the public through sensationalizing the weather reports. A hurricane can be thousands of miles away and people in New England 50 miles from shore will be glued to the channel. A routine snow storm of 8-12 inches is now an event for the ages when a few years ago it was normal New England weather. Are you addicted to the weather reports or the news? After you watch it for a prolonged period how do you feel?
Another example is the economy. Yes, for us contractors in the construction industry the economy stinks. Housing is down, credit is tight, low ball contractors are everywhere giving their work away, homeowners are holding back and more. So now that we know that, what are we going to do about it! Stop watching the news, stop complaining about no work, no leads, no money and start working on you and your business! The successful contractors of tomorrow will look back on this time and know that their investment in themselves now, was responsible for getting them ready for the future, when things rebound. Tomorrow's successful contractors right now are reading books, listening to tapes or cd's, working on their business plan for next year, taking sales training courses, working with a contractor business coach, working on their marketing plan and more.
I remember a seminar a couple or years ago where a speaker said one sure fire way to screw up your attitude is to listen or read too much news. He said if it dies, bleeds, burns, crashes or blows up it usually leads in the news. Just think what leads the news today. Murder, bank robberies, sex scandals, car crashes, business failures, political stuff, weather and so on. How many good stories have you heard leading the news? Probably not many because good news doesn't sell and it isn't sexy, grotesque or controversial.
To protect your attitude determine to spend as little time as possible watching the news. Get your information from the headlines or the internet. If you must be informed locally about a certain issue or situation by all means read up on it. It is very easy to get updates on the weather or news without listening to the sensationalists on the news.
How are you maintaining a positive attitude in these challenging economic and environmental times?
Posted by Mark Paskell on Tue, Dec 16, 2008 @ 08:16 PM
Last Thursday evening I went out for dinner with my wife and came home around 10:00PM with a lite rain falling. Just after 12:00 midnight we lost power. Little did we know that a few hours later our yard would look like a tornado had ripped the trees in the yard to shreds. For three hours we heard huge thuds from snapped branches and tree tops that battered our property and the side of the house.
The devastation was so extensive that thousands of people were destined to live the coming days without the things we assume will always be there. Items like heat, electricity, coffee in the morning, the internet, cable tv, a hot shower, the telephone, running water to drink, water to flush the toilet, water from wells, hot meals, food in the fridge and lets not forget, the microwave.
As the days without the basic necessities available progressed, it was humbling to realize how dependent we really are on the conveniences available to us in this day and age. Not long ago our ancestors were not so blessed with the many advances we enjoy.
We spent three nights in a hotel worrying about the things we didn't have access to and the status and safety of our home. We were in awe of the force of lineman, national guard and private contractors locally and from afar that were working night and day to restore power to thousands of homeowners. Many residential remodeling contractors, electricians, roofers, landscapers and tree companies were seen clearing roads and properties to pave the way for the crews to access power lines. I witnessed several contractor coaching clients offering generators and labor after hours to help those in need. We are thankful for their hard work and dedication to help homeowners and restore power to all effected.
Today we were fortunate to have power restored while many still go without. It is amazing how dependent we are on the benefits that we enjoy from electricity. A couple of days without power and life is turned upside down.
We hope all our neighboring communities will have their power restored for Christmas. Our power restoration is the best Christmas gift we could receive. We owe our thanks to the hardworking men and women contractors who continue to drive up and down our street to help restore power to others as I write this post. If you see a lineman or municipal employee working to restore power tomorrow take a moment to thank him or her for their role in helping others have a Christmas with lifes' basic necessities.
How are you faring after the storm?
Posted by Mark Paskell on Mon, Dec 08, 2008 @ 08:00 AM
Today's residential homeowner construction market has tightened and leads for contracting services are scarce. Leads are more precious than ever. Many remodeling companies were founded by carpenters and tradesman with little or no formal training in sales. You are very good at building things, you are an expert at crafting and your miter joints are perfect. You started out working for someone else only to find you were treated poorly, paid less than what you are worth with no benefits and blamed for the mistakes of the owner. You said the heck with this crap and you started your own remodeling business. After all you can do better and you won't treat your people that way.
So you start out on your own and you develop a fine remodeling business through referrals from your family, friends, relatives and professional contacts. You keep investing in your tools and equipment, you set up the office, and do some basic marketing. Now fast forward to today and the referrals have dried up, marketing doesn't work the way it used to and leads have slowed to a trickle. You run the available leads and unlike a short time ago people aren't buying what you are offering. The approaches from a year ago are falling on deaf ears and you now hear the homeowner say too much money, you have to do better, we need to think about, we are getting five more quotes, or worse, "looks good, you're the guy, we'll get back to you in a week" and they never do.
You spend hours crafting and pricing your proposal and they give you a maybe. Your investment in time preparing and mental anguish is getting you down. You are questioning yourself and start to have doubts about your decision to be a remodeling carpenter.
Now you talk to other successful remodelers, read trade magazines, go to a supplier seminar and you come to the realization that you need to do better at sales. You learn and find out that other remodelers who have taking sales training are faring better than you.
You now are faced with the question and you say to yourself I want to be a carpenter, not a salesman! What are you going to do?
Most people don't want to be seen or perceived as a salesman. Ever been to a christening and hear the relatives say to the parents of the child what do you want your child to be when he grows up? You usually hear the standard I want little Johnny to be a doctor, lawyer, teacher, or some other respectable profession. Do you ever hear I want little Johnny to be a salesman?
Any business that provides products and services to a market has to be sold. If you are the sole employee of your company the sales role has to be performed by you. If you are challenged by the sales role because you don't want to be salesman then you have three choices.
1. Sales training and coaching
2. Hire a salesperson.
3. Go work for someone else.
Now is the perfect time to obtain sales training and coaching to improve your chances of converting precious leads into contracts so you can continue to craft an awesome miter.
What are you doing to improve your sales performance?
mark the coach
Posted by Mark Paskell on Sun, Dec 07, 2008 @ 03:39 PM
I am fortunate and blessed to have the support of many contractor clients in my first year as a contractor coach. I recently received a letter from a client describing his satisfaction with our coaching services and relationship. It describes what The Contractor Coaching Partnership means to him.
From the Desk of Kevin Barnes, Barnes Building and Remodeling
December 1, 2008
To; Mark Paskell,The Contractor Coaching Partnership
Sterling, MA 01564
Dear Mark,
I am writing this letter to thank you for the services and guidance you have provided to me over the course of the past year. Your expertise and knowledge in the field of Design-Build remodeling and construction has been invaluable to me.
Your well-rounded approach to coaching is exactly what I had been seeking to help me navigate the early stages of developing my business and surviving challenging economic times. Being "chief cook and bottle washer" for my business, it is critical to get proper guidance in many areas, including sales, production, marketing, and establishing the systems and processes necessary to run a profitable business. You have been able to provide this for me, in a personal one to one format, which is extremely beneficial and far superior to impersonal over the phone coaching offered by many other business coaches.
I would also like to express appreciation for not only coaching me on the "nuts and bolts" of the business, but also helping me to maintain the proper mindset and vision on a personal level that is so critical to success in any endeavor.
Your large sphere of influence and strong network of associates has also proven extremely beneficial to me, as evidenced by more than $350,000 of new work that you have referred to Barnes Building & Remodeling this year alone. Thank you once again for supporting my business and having the confidence and faith in our abilities to properly service our clients. For any business owner or professional in the construction industry looking to position themselves for growth and profitability, I would highly recommend your services to assist them in achieving their goals. I personally feel that a strong coaching / mentor relationship is a key ingredient to achieving success.
Please feel free to use me as a reference in the future for any of your potential clients. I wish you the best of luck in growing your business and I look forward to continuing our relationship in the coming years.
Sincerely,
Kevin Barnes
Owner, Barnes Building & Remodeling
508.829.1900
If you are a contractor reading this post, does anything Kevin said above resonate with you? Please comment and share with the readers of this blog, your opinion matters and may help others.
If you are not a contractor and you are reading this post, do you know a contractor who would benefit from a coaching relaionship like Kevin describes above?
mark the coach
Posted by Mark Paskell on Sun, Dec 07, 2008 @ 02:06 PM
The economy has presented many financial challenges for both the residential contractor and the homeowner. The economic crisis has deepened and it is increasingly more difficult for homeowners to afford to improve their homes like years past. Many homeowners who can afford to remodel are standing on the sidelines waiting for the market to stabilize. Those who are remodeling and investing in their homes are moving forward very cautiously. Todays consumer is interested in sensible remodeling that has a strong ROI and a contractor that they can trust with their most valuable investment.
To sell and provide services to today's homeowner market, it is important that you are the contractor they are picturing in their mind before they hire you to work on their home. The contractor today's homeowner wants and will hire, demands you act and behave like THE NEXT LEVEL CONTRACTOR. If you don't represent this picture, the likelihood that you will be hired (at the price you need to sustain a legal entity and make a profit) are slim. To win profitable jobs you must show the consumer that they can trust you because of your high level of professionalism.
THE NEXT LEVEL CONTRACTOR is a professional who uses systems and best practices to deliver an outstanding remodeling experience with minimum hassle. To become " a contractor of choice" the professional contractor is an expert in his field, knows how to market to his target audience, has a search engine optimized website that educates his clients and is found on the first page when searched, has a well defined consultative sales process, has a system to professionally produce and administer the service, has a well defined business plan, has the right insurances and certifications (NARI, NAHBR, CLC, CR, CAPS) is licensed, employs professional craftsman who are legal citizens, pays his bills and creditors including taxes, has a place of business other than the kitchen table, has a customer service procedure, has happy clients nearby and more.
To succeed, residential contractors can align themselves with a contractor business coach who has experience coaching contractors. A seasoned coach will provide effective sales training for contractors using contracting best practices and systems to run a profitable business.
For example, if you are a remodeler, custom home builder or general contractor, your contractor business coach program could be customized to include; training for a residential remodeling business plan, design build versus architect approach, certified lead carpenter training, marketing and sales training and development of a production paperwork system.
Contractors who adapt and change by developing and implementing systems and residential construction best practices to match up with the expectation of the new consumer, will become "THE NEXT LEVEL CONTRACTOR, "the contractor of choice".
Are you on your way to becoming "The Next Level Contractor"?
mark the coach