As a business owner, setting yourself up for growth in 2024 requires more than just hard work; it demands strategic planning and innovation.
In a recent webinar hosted by CompanyCam, Adam Sand, the co-CEO of Roofing Business Partner, shared his blueprint for contractors aiming to elevate their profitability. If you happened to have missed it, have no fear, we’ve got you covered on several of the highlights from Adam.
Plus, you can check out the entire webinar from beginning to end.
It’s Not One Size Fits All
Understanding the current phase of your business is pivotal. If you’re in the very beginning stages, that’s an entirely different set of problems you need to solve versus being in a more developed stage.
If you’re in that beginning phase, it’s as simple as defining what you do.
“You’ve got to figure out what you do,” Adam explains. “What do you sell? Who do you sell it to? How do you go to market? How do you sell it? How do you propose it? How do you complete the work? How do you track it? Like you’re just figuring out what you do. So that way, when you [grow], you’re talking about who’s going to help you can start to give them processes so that they can help you.”
As you reach that larger stage of business development, your focus shifts to things like “leadership” structure and “automating systems.”
Basing Your Business On Just ONE Number?
It’s essential for business owners to get a quality view of their overall business. That doesn’t mean it requires a complex formula.
Adam says you can accomplish this with simple math.
“You take your best two months and your worst month, and you average those three numbers out, and you build your cost basis around that,” Adam said. “It’s about what you are making monthly, and how’s that growing?”
The critical point is the “run rate,” not just the total revenue you bring in as a business.
He gave an example to make this easier to understand.
“A $2 million company could have made a million dollars in the last two months, right? Or that $2 million company could run consistently at $160k monthly. Your run rate is important. Build your cost structure around that, and set your target at that. This is what you hire around, and you build your processes around.”
Don’t Upgrade Technology to Upgrade
Adopting technology is not just about staying current; it’s about enhancing service delivery and operational effectiveness. Adam advocates integrating technology directly contributing to smoother operations and an improved customer experience.
Don’t just adopt technology because it’s new and available.
“How do you go through your business to go, ‘what should I automate for?’ Like, what do I tackle first versus what is less important to automate in the beginning?
“What you need to automate is reducing the unit costs of processing a unit of business.”
When you are picking out ways to insert new technology into your weekly processes, it’s vitally important to have accurate data to feed into those systems.
“The biggest gaps that I see missing in tech stacks is they have multiple sources of truth, and they wanna automate the wrong things first,” Adam shared. “It’s making it so that you know that you have good, you have a single source of truth, and you don’t have two projects open for the same job because the guy didn’t put the address in.
“Or they did a door knock, and they put the wrong address down, or then they got the wife’s name, but then the husband’s the one that called.”
[Adopting technology] is about reducing the friction it takes for people to do their job.”
By implementing these strategies, contractors can position their businesses for increased profitability in 2024.
Didn’t catch our earlier webinars? They’re all waiting for you here!