Back to the BD basics

Tim Klabunde posts his lastest SMPS Marketer article, Back to the BD Basics, in his most recent Cofebuz blog. His blog entry is worthy of several re-reads if you are wondering what you should do to make it through the recession.

Among his suggestions, he writes:

Focus on being the best: Now is the time to set-aside change orders and additional work authorizations (within reason) and give all of your clients 1,000 reasons why they should never even consider another firm. Begin by asking yourself, “What can I do to help this person that is above and beyond what they hired me to do?” Remember that focusing on being the best isn’t something that just one person or a group of people can do, it is a company-wide focus that requires buy-in to be successful.

The basics of construction industry marketing remain consistent -- but if you remember the basics, you will make it through.

What to do when everything is going wrong

You may also wish to review this posting from April, "The Quick Fix -- And Better Solutions"

Your phone has stopped ringing. Your backlog of work is near zero. And with the gloomy economic news around everywhere, you don't see much hope for the future. What should you do?

I posted some basic survival strategies in a previous entry, pointing out that if you are really good at what you do, you should be able to survive even the hardest times. This requires you to be in the top 10 to 20 per cent of your speciality, niche, and overall talent. If you are just 'average' in the current circumstances, you will struggle and should think about redirecting your energies to where you are truly great -- and truly enjoy your work. (I know, easier said than done, when you are looking for food for your family, now, but vitally important if you want to be in business for yourself and truly make it through the difficult environment.)

Still, whatever business you are in, you need paying customers to give you enough work to continue, so you must be resourceful, thoughtful, and diligent in tracking them down. Here are some tools and resources you can consider in finding business when it seems none is to be found.

Former clients
Probably your best opportunity. Take a list of people you have done business with in the past, and who really enjoyed your services, and call or visit them. See if they have some little things they need done; and while you are with them, listen to see if they know others who could require your services.

Canvassing
It's hard rock, its painful, and it can be demoralizing, but you will find a few people out of a few dozen who can use your services. It also keeps you busy.

Public works/rehabilitation/community service projects
You should check with your community/town and see if there are state/local funded rehab funds available. You may need to go through some paperwork, but you could win some useful work. This is more likely to succeed if you have some connections within your local community government -- check with your council member or someone politically connected for insights on the ins and outs of public works opportunities.

Inspiration
Here, you come up with something new, creative, innovative, and adventurous -- and set out to promote it with free publicity. Audacity can work here to help you stand out from the crowd. Keep an eye on innovations in other communities, and copy liberally, or come up with something on your own.

Your best and most likely source of answers is within your previous client base/network.

Don't stop believing

The IMG Creed

Because the customer has a need, we have a job to do. Because the customer has a choice, we must be the better choice. Beacuse the customer has sensibilities, we must be considerate. Because the customer has urgency, we must be quick. Because the customer is unique, we must be flexible. Because the customer has high expectations, we must excel. Because the customer has influence, we have the hope of more customers. Because of the customer, we exist.

I really enjoy this motto from the website of Integrity Marketing Group (Roy Zeh). I don't know him or his business, but sense IMG observes the values outlined in this blog entry.

Craig Galati, in his The Heart of Business blog, presents an impressive argument of the essential value of faith in marketing. He writes:

Who would hire someone or buy something from someone who doesn’t believe in himself? One of the most important aspects of developing new business is confidence. You must know and truly believe in the value you are providing to your clients.

Galati's observations ring true -- and, at least informally, are validated by the experiences of others who have lived through good and hard times, yet somehow kept their businesses intact. Deep down, you find in longer-term success, resilience coupled with talent and what seems to be a magical additional ingredient. Dumb people might call it 'luck' but individuals of different religious faiths would link it to the spiritual realm.

I'm certainly not describing here the blind and mindless arguments from The Secret (The Law of Attraction) and other similar sources which advocate seemingly blind (and dumb) faith. And I've seen (and fought against) some con-artists who know how to give false hopes and success visions to sometimes desperate and often unsophisticated suckers. You know you are dealing with these charlatans when they fail to make clear that you should not enter the business journey without real talent in your field, and real perseverance -- the 'luck' or spiritual edge only is valid if the other two ingredients are there.

But you can see the positive side of business success connecting with larger values when you review yesterday's Contractortalk.com thread about the renovator who has battled the cost of his child's illness, and economic setbacks, and is now receiving practical advice and support (which, by the way, is useful for anyone facing inordinately hard times). And I've shared several times my own two business rebound stories. If you are really good at what you do, and your faith is so strong that you will not give up, no matter how the odds seem stacked against you, just at the moment when you let go of your security ropes, and all seems to be failing, you'll receive the answers you are seeking.

How to start all over? Triumph over Tragedy?

This contractortalk.com thread about personal tragedy and the struggle to rebuild is both disturbing and rewarding. Here is the original posting:

Hi,

Not sure I should post this, but here I go....

Over a year 1/2 ago, my 2 year old daughter was diagnosed with a terminal bone marrow disease. Her chance of survival was less than 30% past 3 months without a donor (which she does not have) and yet, to make a long story short, after many transfusions, treatments, etc etc, she is still here with us. This is what matters most.

Financially and professionally, this challenge has devastated us. My wife was forced to quit work, we had another child in hopes that he/she would be a donor match (older son is not, younger one not it either). My business used to do very well, we had a nice house, cars, traveled enough...regular comfortable people with enough money in the bank to see the hard times through....or so we thought....

Needless to say, we lost it all. We have just moved into another home about 2 hours away from where we lived 10 years (which we will probably lose soon), dropped our cars, wasted all money in savings on medical care and expenses while we were in the hospital with our child for 6 months....Perfect credit went to garbage and on top of that...the housing/real estate/construction business collapsed.

Now I commute to work and are forced to stay in the area I work, so I barely see my family (only in the weekends) and of course this is killing me. I dont know what to do, I've never had to advertise, never had problems finding work as I had plenty of referrals, but I am forced to do something now. I've never really had to worry about losing my home to non-payment or having my light turned off and not providing for my family...this is all new to me and yet I'm trying to rise from this situation and move on.

Here's my question to you all....WHAT WOULD YOU DO TO START OVER, in a new area with a limited budget? I have been reading posts on advertising for days now on this site, and am still confused. What gives the best immediate return? At this point, money in advertising spent will be money taken away from bills that need to get paid....so I would like to know which risk is best to take. I don't have much, maybe, maybe, maybe I can take $700 and put it to work somehow. Maybe a couple of hundred a month going forward....

Sorry for the long, boring email. I'm new here, my worries are my own, but I thought if you understand my immediate situation, you can advise me in a more direct way.

Thank you so much!
Sevi

The responses are challenging, inspiring and in many cases, extremely practical. If you really need help from the community, it is usually wise to ask for it. I admire Sevi's courage and determination to forge ahead for the health of his child, and family.

The North Carolina Roofer's solution

Bob Kruhm reports in his North Carolina Construction News blog a great story of how a Charlotte, NC roofer adapted and refocused his business to overcome the sudden recessionary downturn in his business. The solution for Edward “Ned” Arthur's H & S Roofing, is networking and effective publicity, including this story in the Charlotte Observer.

Participating in community and trade organizations, and reaching out for positive publicity, are highly effective marketing methodologies -- and they won't break your bank account. It helps, of course, if you have a healthy business to start with; one founded on solid service and great client relationships.

Marketing Engineering Services in a Downturn -- Tim Klabunde

If you haven't already bookmarked Tim Klabunde's blog, CofeBuz, the Marketing and Business Blog, and you are an engineering services marketer, I recommend you review his latest posting: "Marketing Engineering Services in a Downturn". And his posting leads me to another site/blog worthy of permalinking, Civil Engineering Central , co-ordinated Carol Metzner, President of The Metzner Group, LLC, and Matt Barcus, President of Precision Executive Search, Inc.

Making the most of the economic downturn

You can view a PDF of Randy Pollock's SMPS Marketer article on "Making the most of an economic downturn" at Tim Klabunde's CofeBuz blog. If you look carefully, you'll see my modest contribution to the piece.

Surviviving (thriving) during a recession - (2)

My original posting The 80/20 Rule -- Surviving (thriving) during a recession has been introduced as a thread topic on thecontractorclub.com. You might need to register to visit the forum/thread, but if you do, you'll become part of a community of contractors who truly care about their business and share useful insights.

The 80/20 Rule -- and Surviving (thriving) during a recession

Image from Inman Blog: The Inside Track on the Real Estate Industry -- and a posting reporting that newly constructed homes are now selling at a discount to resales -- a sure sign of problems in the marketplace.

You have to be pretty thick to deny the economy is turning south, and fast, at least in much of the U.S. (Parts of Canada such as Alberta are booming and Ottawa -- being a government town, is somewhat immune from recession.) A sign of the times: Yesterday, I received a call from Florida from someone wishing to become a new local publisher for us. His business flipping homes had failed. When small operators get into real estate in a big way you know you are nearing the end of a boom cycle.

So, what should you do?

Motivational guru Brian Tracy and the late Walt Hailey taught me an important concept. They said: "Imagine the worst possible situation, where 70 to 80 per cent of the population is without work. Who would have the jobs? -- the 15 to 20 per cent who are the best at what they do. So make sure you are in the 20 per cent even in the best of times."

The world of course is never perfectly fair. Incompetents sometimes are 'protected' and talented people lose jobs or businesses in hard times. The difference is the talented individual can usually rebound and find another answer. As an example, if you are really good and are laid off your employment, now may be the best time to go into business for yourself. You won't have the overhead of the 'big guys' and you'll know your stuff and maybe even have a few customers to serve already -- so you are ready to start!

Of course, as I've written several times, the talents within your trade are not the same as the talents you need to run a business. You need systems, processes, common sense, and a whole lot of business management skill to do it right. But I wouldn't let these limitations stop you. You can learn these skills and if you really enjoy and love your trade, you'll find a way to solve the other problems.

Now, say you are the business owner and things are turning desperate. Here, you need to avoid the biggest mistake people make when things go bad -- behaving like an ostrich. You need to face the music, and do what needs to be done to set things right, and you need to get to work on the problem now.

Your good options are: Reduce costs, increase revenue, or do both. You have another two dangerous options: Increase your debt or 'invest' more capital (personal or investor funds) to make the business work.

Let me deal with the latter two options first. I think it is truly dangerous to pour good money after bad -- before you rationalize and justify this type of action, consider it VERY carefully. Yes, there are some situations where applying more resources to the problem will pull you over the hump, but you need to be absolutely certain this is the right thing and when the economy is going the wrong way and you are trying to stay afloat, I'd be very cautious. (If you are thinking of a start-up, by the way, I am advocating a low or no-capital start up. Use your sweat equity, not your cash!) Be especially cautious if the bank or your suppliers ask you to secure your debts with personal assets or guarantees; you may have no option, but it is probably wiser to reduce your debt than to sign these papers.

Now, if you need to fire/lay off employees because of economic circumstances, or if you see down the road (hopefully not imminently) that you may become insolvent, waste no time in finding professional legal advice, now! In the former situation, the problem is that even though you may be justified economically in asking employees to leave, you must beware of anti-discrimination laws and the possibility of an ex-employee going after you. It happens (especially in hard times.) In the second situation, if you think you have a risk of insolvency, seeing a qualified lawyer well in advance may help you protect personal assets and mitigate the losses. IF you wait until the last minute, you will be screwed as courts will overturn last-minute asset transfers, etc. Best of all, if your advisor is good, he or she may be able to suggest alternative solutions. (Yes, a little more than a year before we 'hit bottom' I sought the advice of a bankruptcy expert/lawyer -- we made some changes to pay off what appeared at the time to me to be a 'safe' form of 'unsecured' bank debt - the lawyer showed me how this debt really would have left me with much personal liability. A sign that I had indeed weathered the storm was the day I repaid the lawyer in full -- and we have now cleared down most of the other major business debts, paying everything owed, without needing to file papers.)

Finally, you should appreciate that in hard times, the most 'secure' job you can have is likely to be your own business, at least if you know how to keep things in balance and are ready to do what you need to do. I've heard of contractors weathering really severe storms by doing small-scale maintenance work for existing clients. They lay off all their employees, but are able to maintain their own personal income.

So:

• Be sure you are spending most of your time and effort doing what you are really good at -- Remember, even in the hardest times, the 20 per cent at the top will survive; even thrive;


• Don't bury your head in the sand -- you will need to make changes. Cut costs, increase revenues; do what you need to do, without delay.


• Seek professional advice well before you 'need' it -- this is especially the case if you must lay off or dismiss employees or you think an insolvency is possible down the road (don't wait until the last minute for this advice).


• Self-employment is often an excellent form of security in hard times; if you are good at your work and fear you are about to lose your job, consider it as an option -- just do it without significant (none is best!) capital investment.

Next week, I will begin digging deeper into the real world of the economy and its impact on the trades. Bob Kruhm in North Carolina has asked me to write a story on the trends and how contractors and construction businesses are adapting; and this fits in line with some impending SMPS Marketer assignments. And since I enjoy writing and am good at it -- I'll gather some intelligence that will be hopefully be helpful for your business.