For over a dozen years,
NSPG has been providing the tools that allow contractors to
increase profits and minimize business hassles. With our
simple-to-use-tools, you can make being a business owner
what you always wanted to it be -
successful, profitable and rewarding.
Charge enough to make a
profit, because you’re worth it. However you must create
the environment for it to happen.
Plug a Leak
Recently, Kiplinger's magazine
ran an article about what to expect when you need a
minor plumbing repair. As expected, the article
reflects the usual stereotypes of out of control pricing
and unqualified plumbers. Despite the negative
tone, there are a few lessons to be learned.
The article starts off by
stating that the going rate would be between $50 and $70
per hour. Right away you know that the author has
not spoken to a reputable plumbing contractor in a while. Any
full service contractor charging in that price range
is probably not making any profit from his labor hours.
Overhead alone is higher than $70 per hour for most full
service plumbing companies. Even if you're
quoting only $70 per hour and
making a profit, you probably
receive price complaints because most homeowners compare
your rate to what they earn per hour.
The Kiplinger's article then
goes on to say that the homeowner should get a binding
written estimate before work begins. So, he starts
the article talking about the hourly rate and then says
the contractor must provide a flat rate job price before
work begins. We agree with this idea (after all, we
sell the best flat rate system on the market), but
the presentation in the article implies that any
contractor will rip you off if you let him.
The next point in the
article is that the homeowner should rely on referrals
from friends or on line sources to find a reputable
contractor. This is good advice for the consumer
and leads to certain things that the contactor can do.
Your clients probably will
recommend you to their friends based on the quality of
your work and the services you provide. People
will seldom recommend a contractor based on a low price
alone unless they also perceive the quality of the
service to be high. A contractor who arrives in a
beat up old truck, in dirty clothes, who leaves a mess
behind because he has to do 8 or 10 calls a day to
survive on $50 per hour, probably won't earn a referral.
This is where the two points
come together. Charging a profitable rate that
allows you to provide the high level of service that
your clients expect is critical for your business'
success. Knowing your cost of providing technician
training, clean uniforms, and generally high quality
service is critical in assuring that you make the profit
you need to stay in business. It also allows you
to balance the costs versus the service you provide so
you get the referrals you need to keep your business
The article concludes with a
section on copper, PVC, and Pex. It implies that
the plumbing contractor may intimidate the homeowner
into choosing the wrong material for the job.
This is a nonsensical idea. Since your prices are
based on the cost for installation of each material, the
decision on which material to use should be based solely
on what is appropriate for the job. Of course,
being up on the latest materials and technologies is
important. Besides allowing you to offer the appropriate
solution, it offers the added benefit of improving your
company's image as a high tech solution provider.
This article follows the
trend of running down contractors in general. In
doing so, it points out some of the ways that you can
keep your business growing and profitable. Knowing
your costs, providing a high level of service, keeping
up on the latest technologies, and earning referral
business are some of the lessons that the article brings
Sometimes we forget the
interdependence of the many facets of our businesses.
Even an article that seems to be designed to perpetuate
negative stereotypes of our industry can be useful in
reminding us why we run our businesses the way we do.
Know your costs. Present them using Flat Rate to
reduce price complaints. Provide good quality
service. Earn a reasonable profit. Build
Measure Monthly, Adjust Quarterly
& Achieve Annual Profit Goals
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Some efficiency recommendations
In This Issue
Phone 800 841-8542
The freebie of the month is a web site or
product that we feel gives you some-thing worth looking
at or using that costs you nothing.
Office 2007 Compatibility Pack
Some time in the next few weeks, new computers will
begin shipping with the latest version of Microsoft
Office products - Word, Excel, PowerPoint, etc. These
new version will have a new data file format that is
incompatible with older versions of the same product.
While most of us will not upgrade to these programs,
eventually we may have to share the files. If you
add a new computer to your office, you could end up with
data files that cannot be used on the older machines.
There are two fixes for this problem. First, you
can specify in the new versions that all data should be
saved in the older formats. This is probably the
best fix, but could lead to problems if you forget to
save in the older formats.
The second solution is to download the
Office 2007 Compatibility Pack
from Microsoft. This utility will allow older
versions to read the new format. This will assure
that whatever format is used, your computers can all
This link has a good explanation of both methods for
sharing your Office data files. You may not need it
today, but keep it in mind when you get that new
If you have
a favorite Free site, let us know.
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