KickStart: When you increase revenue for your business you can pay more to attract better applicants! (And keep the great team you’ve already built.)
Outline
Introduction – Profitability Is King
Tired of the never-ending struggle to attract and retain top talent in your HVAC business? Want to boost your home service business profits without breaking a sweat? Well, you’ve come to the right place! In this article, we’ll explore a simple yet powerful strategy that can help you increase service business revenue while ensuring your team is happy and motivated. By understanding the true cost of doing business and making strategic pricing decisions, you can grow your business and achieve long-term success.
Start Charging More
I’ve always pushed my students to “charge more”! Why? After almost 50 years in this industry (I started young!) I’m convinced the vast majority of residential service contractors do not remotely understand the TRUE COST of daily business.
But hey, I’m not really a ‘number crunching accountant’ type of guy! So instead, I just preach to my students:
1) “All other things being equal… its better to have LOTS of money instead of having NO money!!”
But the plot thickens! Thanks to good, old ‘supply and demand’ employees have realized that for them too “its better to have LOTS of money instead of having NO money!!”😰 (More workers changed jobs in 2021 than ever before in history!)
This means to compete for the ‘Very Best People’ you’ll need to ‘pay more’ which means you’ll need to… (Don’t rush me, Steve, I’m thinking!)
2) “I know, Steve! I need to (hesitantly) CHARGE MORE so I can PAY MORE to attract better applicants!” Yes!
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And yet this “PAY MORE to attract better applicants” strategy will probably have ‘consequences’ for you! Here’s a tough reminder…
Offering the higher wages new hires are demanding will have a ‘trickle-down effect’ in your company! For example, here’s how your increased starting wages will likely play out with your loyal, long-time staff…
Upset employee: “Steve, wassup with this help wanted ad you just posted for new job applicants? You’re offering new hires more than you’re paying me even after two years working my butt off here!”😣 You know, your worker is right! So this means…
3) “Ummmm, I’m going to need to pay ALL my employees more?” EXACTLY! Which means… You need to raise your prices NOW!
Raising prices can feel tricky, but it’s a necessary step to increase service business revenue and keep your business thriving in today’s competitive market. But don’t worry! There’s good news on the horizon.
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Increase Business Revenue Sooner the Better
A) People now EXPECT you will be charging more! Thanks to the constant drumbeat of inflation news potential customers (and your repeat clients too) ASSUME your home services will cost more. BUT they won’t OFFER to pay more till you ASK for more by increasing your pricing!
NOTE: Stop fretting about losing returning customers and increase business revenue. Click HERE for my slam-dunk ‘Rebooking Previous Clients after Raising Prices’ phone script. (Want more phone scripts and systems? I’ve gotcha covered!) And here’s another happy tidbit…
B) You don’t need to raise prices by a HUGE amount to pay more. For example, if you’re making a good profit at an average gross of $100.00 @ hour per on-site worker consider hypothetically raising your prices by 9.67%. (An ‘odd percentage’ is always more credible than the good, old 5% or 10% increase!)
If we round this 9.67% increase off to $9.00 per employee hour and stick 2/3 of it toward other expenses (inflation IS rising) you could still give ALL your workers a 3.00 @ hour across the board raise at no extra cost to you! (Yes, I know I’m painting with a broad brush here- you and your accountant will need to work your own numbers.)💲💲💲
Even more good news? If you have ‘Service Engineered’ your client’s experience they will be referring you like crazy! (Including online!)👍👍 New customer sales is an additional way to increase service business revenue. These delighted customers mean deep-down-inside your first-time callers will only want YOUR company in their homes! (Callers may bluff but ‘stick to your guns’ and they will almost always cave in!)
Summary – Examine Your Methods to Increase Revenue
So, are you ready to take the reins and increase service business revenue? By following these simple steps, you can attract and retain top talent, boost your bottom line, and ensure the long-term success of your HVAC (or other home service) business. Remember, it’s not just about charging more; it’s about providing exceptional value and building strong relationships with your clients. So, what are you waiting for? Start implementing these strategies today and watch your business thrive!
Now… don’t you have some serious number-crunching to do?😁