Poor pricing and hiring practices aren’t the only things that can trip up your business. Here are some other pitfalls.
Lack of good systems
Jarrett Culverhouse, co-owner of Care Free Lawn and Sprinkler, LLC, learned that every minute you’re not making money, you’re losing it. “It comes down to even the amount of time it takes an employee to come in, get what he needs, and go to work. We narrowed it down to where they need to be out of the yard in 10 minutes – boom, they’re gone. If it takes them 30 minutes, I’m losing money.” To expedite this, all his trucks are preloaded with needed equipment before the workers arrive each morning.
Too many accidents
Successful companies are safe companies, with good training programs in place. “Worker’s compensation premiums have gone up,” says Bill Arman, a consultant with The Harvest Group. “If you have an accident-prone company, that alone can take you out. You’ll have to price your work higher to cover those additional costs.” If you have too many accidents, you may lose your coverage altogether and not be able to get a replacement.
Paying cash for everything
Green industry consultant and educator Tony Bass says many small contractors think they must pay cash for equipment or they won’t make money from it. “But I’ve never worked with any five-million-dollar-per-year contractors who buy their equipment; they lease it. Lease payments tend to be lower, which improves your cash flow. Big companies understand this concept, but smaller, younger ones struggle with it.”
Finally, if your business is failing, look in the mirror. “One of the biggest reasons businesses fail is because their leaders lack leadership skills,” says Arman. “They’re so busy working in the business instead of on it, that they have no time for strategic thinking.” Rick Longnecker, co-owner of Buds and Blades, had to see how his leadership role needed to change, from having been the boss of three to five people to being the boss of 16, virtually overnight after purchasing another landscape outfit. “I had to learn that I’m not the guy who has to get things done anymore; now I’m the guy that has to make sure things get done.”