How Being Proactive Can Protect Your Sweeping Business

It’s no secret the economy is tough. The stories are predominantly the same regardless of where you live. Your customers ask you to do more for less, just as the government is trying to take more of what you earn. Some of the largest property management companies have declared bankruptcy, prompting many contractors to wonder if they will ever see the money owed to them. You may be facing the prospects of slimming down your work force and breaking the news to employees that depend on you for a living. Things look bleak all over. But there can be a silver lining around this dark cloud of doom. We believe that the answers are not found in burying your head in the sand and waiting for things to work themselves out. Borrow the title from Rick Page’s book, “Hope is Not a Strategy,” and take this opportunity and time to be proactive in all aspects of your business. We want to touch on a few strategies that are crucial to maintaining and successfully growing your business in tough times.

Budgeting

A frequently asked question we get is, “How do we compete in this tough economy against low bidders?” And to tell you the truth, the answer isn’t easy and sometimes there’s not a lot you can do. When your competition is willing to sweep for what you made 20 years ago in high school working at local fast food joint, it can be brutal. It’s tough not to be perturbed when you are spending 100 hours a week and every cent you have building your business, only to see someone who doesn’t know their costs underbid and destroy the market. You can’t stop the tide, but you can mitigate the impact on your business.

Know your costs and limits. You must understand your costs fully to compete in a tough market. Know your variable costs, your fixed costs, and what type of economies of scale you can achieve by expanding your market. You can’t afford to guess when every dollar counts. Know your margins, set parameters that are comfortable, and stick to them. You may find that knowing all of your costs gives you more flexibility in the pricing of the bids you are placing.

Remember that profitability does not necessarily correlate with the amount of money a customer gives to your business. In many cases, smaller accounts can be highly profitable, while large accounts can cost your company a lot to administer, thereby leaving you with a smaller profit margin. Run scenarios with your budget and margins to maximize your bottom line. Optimize what you have and concentrate on profitability, not overall revenue.

Marketing

When companies are looking to save money, one of the first cuts is often marketing. What people can’t see, or don’t see, is that marketing is an investment in future sales and market share. Remember that new economic conditions, good or bad, create new opportunities. Look at your market and evaluate what is the best way for your potential customers to find you. Yellow pages, websites, brochures, ads, flyers, social networking...the list goes on and on.

It is important to remember the marketing you are already doing. The shirts your employees wear, the appearance of your office or shop, the condition of the sweeper trucks you operate, and the quality of your service are all forms of marketing. They create an impression in the minds of current and potential customers. If you aren’t creating this impression proactively, then it will occur by default – and you may not like the results.

Create a marketing plan that is simple, clear, concise, and well thought out. Your plan should be a document that guides you through your marketing program. It should focus on the objective of your marketing and how you intend to accomplish that objective. Whatever medium you decide to use, it’s important to have a focused strategy to accomplish your goals. Write down a simple plan, stick to it, review it, and never stop marketing!

Communication

We can’t emphasize this enough. As frequently as possible and practical, make contact with your customers. When interacting and building relationships, strive to understand their business and find ways that you can help them. Property managers are under the same pressures you are to cut costs and save money. Set yourself apart as a service provider. Remind them that opting for the lowest-priced contractor may be a short-term solution with long-term consequences. Educate your customers about the sweeping industry. Does your competition carry the right insurance? Are they really doing the same quality job you’re doing, or are they cutting corners? Are they using the proper equipment? Many property managers, if properly educated, will pay a few bucks more to have the job done right.

While keeping in touch with your many customers, make sure you are doing it the “right” way. It’s important to decipher how your customers communicate and tailor your approach, without losing the advantages of making it personal. One extreme is the tech-savvy entrepreneur that e-mails and sends text messages, but never makes a phone call – probably a model of efficiency, but losing that personal touch that separated him early on from the competition. Have anything important to say? Don’t e-mail it. Face to face contact is the best way to communicate, followed by a phone call. Personal contact allows you to read the customer’s reaction and handle any concerns they have immediately. Use e-mail for follow-up and confirmation, not conversation.

In the tough economy of today, it is not enough to simply react – you must be proactive. Gain knowledge and experience through networking. Know your business, know your competition, and be creative. Now is the time you should focus your efforts on all those things you know you should have been doing but felt you were too busy get done. Ask questions and don’t be afraid to innovate. These principles, if effectively implemented and followed, will set you apart as an exceptional sweeping company.

Tracy Day is president of Nite-Hawk Sweepers and Jake Hoerman works in sales and marketing for Nite-Hawk, which manufactures the Osprey, Raptor and Raptor Edge sweepers. Contractors can see their units in booths 617-625 at Pavement LIVE, Nov. 30-Dec. 3 in San Diego, or visit the website at www.nitehawksweepers.com.

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