Efficiency For Profit Or Inefficiency For Loss
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total Video & Workbook time
Your equipment was selected, and your crew was trained for a specific service, or for a range of services. There’s a tendency to build in a bit of extra “range”, for your ability to service a slightly broader list of customer’s needs… just in case.
However, the more you veer away from the ideal setup, where you’re matching the service requirements, with the crew, then training to be to get the job done efficiently and quickly, while maintaining quality of service / results for your customers – the faster your profits drop.
When you’re shifting markets, looking for business, and while in a price war, you become less and less efficient.
Double down on reaching your ideal customers – they’re always there. The competition, focused on a “price race to the bottom” will miss that market – because all they did was drop the price, which will never save a business.
The other – strategic – option is to tool up to meet changing market demands, so you can serve that market profitably. It all depends on market conditions.
Completing this module will help you:
Tips & notes
Markets, customer’s preferences and needs, the economy, pricing and competitive pressures are always changing. Being observant of what’s happening in your market (long term and short term) will help you make efficient, and profitable strategic decisions.
For example; when to switch out equipment, crews, change your pricing and perhaps your target market. It doesn’t have to be drastic, but you’ll see that constant awareness of the “mix” between what you offer, how you deliver the results and what the market is looking for will keep you in good stead – and flexible. Which means not only profitable, but at every step you’ll be able to leverage the changes in market conditions.
Great profits always emerge during changing times – but only when you see it coming and take systematic, but gradual action.
There are no market conditions where profits cannot be made as long as what you offer matches up with your equipment, crew and marketing mix.
There are only a handful of factors, which when put together and connected will paint a clear picture of what you need to do.
It’s very likely that you’re already sensitive to these factors, and are only missing the “glue” between them. It’s like a jigsaw puzzle. Once you put the pieces together, the picture is clear.
The success of any business is dependent on looking for business you’re geared up for, and turning down business that you’re not. In general, the more narrowly focused you are on specific services, the more profitable you become.
That is not to say that you cannot focus on multiple services – but each “business line” needs to be thought of and managed as a separate business within the business.
Video 48 Min + 25 Min read to complete worksheet
Just because you may have invested in new equipment, or hired more people and invested in training them, or paid a large repair bill for some machinery – doesn’t make it profitable. You can’t force profit in the market. That thinking is backwards. You’re tail and the market is the dog. The tail can’t wag the dog.
Strategic foresight is absolutely the key here. You have to stay ahead of the game, and make hard decisions before you’re forced to. You can’t keep staff working simply because you like them, any more than you can afford to use a massive piece of equipment to do a small job.
With a long enough horizon, you can change your crew’s duties, and sell/buy/rent equipment as needed without major upheaval. This is where “planning” comes in. Looking ahead, and always “reading the tea leaves.”
Video 42 Min + 22 Min read to complete worksheet