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101 Do's and Don'ts for Small Shop Operators

August 1, 2004
DO read this list. DON'T neglect to do things that will make you more money!

My mission is to help contractors make a living doing what they love. On the seminar trail, I meet lots of folks who love to tell me what works for them ... and what doesn't. I'd love to share this wisdom. So, here is a collection of Do's and Don'ts for every area of business.

Taking charge: leadership do's and don'ts

• DO join a trade association. Shop around first, and find one with a mission and philosophy that matches yours.

• DO find exceptional performers within the walls and ceilings industry and copy them.

• DO find a successful business owner with whom you don't compete and offer to become his or her mastermind partner. Commit to help each other improve as business people.

• DO read at least one book per week. Alternate between classic novels, humorous fiction and business books.

• DON'T miss your kid's football game because you choose to work instead.

• DO commit your hopes and dreams to ink and paper, or computer bytes. Keep a journal. Thinking manifests at one level; speaking and writing creates at an even higher level.

• DO use a day planner. We are too old to remember everything. Who cares if you look like a nerd-you can laugh all the way to the bank.

• DO listen to books on tape or CD in your car. My current favorites: Good to Great by Jim Collins and Time to Make the Donuts by Bill Rosenburg.

• DO handle the issues that keep coming up and spoiling your success. Talk to a friend or a minister. Go to the desert for 40 days and 40 nights.

• DON'T lie. Even "white" lies chip away at one's integrity.

• DO say, "Tell him I'm busy right now, and I will call him back later."

• DON'T say, "Tell him I am not here!"

• DON'T look for service standards within our industry. Go to Disney World and watch how they do it.

• DO lead by example.

• DON'T talk so much.

• DON'T imagine that you are irreplaceable. Once upon a time, our business partner's last words were, "If I don't do it myself, it will never get done." He died two days later. Things got done.

• DO go on a ride-along with one of your technicians at least once a week.

• DO make a sale yourself every once in awhile, just to show the rest of the team that you still got it.

• DO watch "The Apprentice" when the second season kicks off. Yeah, I know. It's just TV. But watching it is educational. It will get you thinking about business as a game ... because it is.

• DON'T enter into a 50/50 partnership. There is no such thing.

• DO find 10 things that are going right and congratulate the people responsible.

• DO find something to laugh about and share it with someone.

• DO read the autobiography of Christie Brown. It will keep you from feeling sorry for yourself.

• DO what you say you will do. Be a Samurai: Every word is a promise.

• DO it today.

Making money: financial must do's and never do's

• DO understand that one is in business for the money.

• DON'T be ashamed about that.

• DO run a balance sheet, income statement and cash flow report every week. Once a month is not enough.

• DON'T trust industry averages for budget and performance comparisons. If most businesses stink, and they do, what can be learned from industry averages?

• DO base selling price on the costs of doing business.

• DON'T pay any attention to what competitors are charging. What do they know?

• DON'T forget what you really sell: time and knowledge.

• DO remember that the knowledge takes time to deliver.

• DON'T kid yourself. You are not selling materials.

• DO consider material sales as gravy. Materials take time to install and that's what you sell.

• DO track billable hours. It's the variable with the most impact on financial position.

• DO create a line item in the budget for "customer satisfaction costs." Allow 1 to 2 percent of total sales. This is for making folks happy the second time around, when you blew it the first time around.

• DO understand that the proper selling price is the first and most important step in making more money for the company and employees.

• DON'T spend money on marketing, uniforms, new trucks, computer systems and new employees until prices are raised to cover the new costs.

• DO get out of tract-home work now, unless the company is very, very good at tract home project management and has the financial data to prove it can make money doing it.

• DO learn about real estate. Eight out of 10 self-made millionaires have significant real estate investments.

• DON'T forget Warren Buffet's rules for business. Rule #1: Never lose money. Rule #2: Never forget Rule #1.

• DO grow rich in a niche.

• DO something no one else does and charge a lot of money for it.

• DO pay employees much better than anyone else.

• DON'T forget that there is more than one way to make a living.

Get it sold: sales and marketing pitfalls

and windfalls

• DO whatever it takes to make customers happy, even if it means giving them all their money back. If one is being taken advantage of, then ...

• DON'T work for that customer again.

• DO spend more time asking questions than pitching a product.

• DON'T make a sale if it isn't in the best interests of the customer.

• DO learn about marketing. Good books for starters: Selling the Invisible by Harry Beckwith, The Wizard of Ads by Roy Williams and Bang! by Linda Kaplan Thaler and Robin Koval.

• DO create a bulletin board of all marketing pieces. Everything should "match" and reinforce each other. Make sure the material is presenting a consistent, clear image.

• Do give customers one good reason to call. Boil it down to an elevators speech, an eight- to 24-second speech on why you are their best option.

• DON'T forget what they are really buying: time, their time. Because of a company's service, they don't have to spend their time worrying, wondering, calling around, shopping or fixing it themselves.

• DO ask the customer for feedback. Send a report card, or follow up with a phone call.

• DO ask for the sale every time.

• DON'T worry when they say, "No."

• DO ask if you can ask them one more question.

• DO ask, "What made you say, ‘No?'" and see if the issue can be fixed.

• DO feel free to say, "No" to customers who won't allow the company to make a profit.

• DON'T discuss poor performance in a crowd.

• DO acknowledge great performance in front of as many people as possible.

• DON'T underestimate the power of a handshake, a smile and a sincere, "Well done!"

• DO anything and everything that will make you stand out in the crowd.

• DON'T use low prices as a selling advantage. The advantage disappears the moment someone offers a lower price.

• DO switch to "flat rate" and up-front pricing because your customers want to know "how much" before they buy.

• DO offer service with a smile. Customers will respond to it.

• DO keep score in the sales game. Competition is good fun and good for you.

• DO read a Zig Ziglar book. Zig is the godfather of sales.

• DO listen to old people.

• DON'T gossip.

Get it done: tips for delivering the goods

• DO work on your own attitude toward work and life.

• DO choose to work with folks who don't suck the life out of business. Employment is a day-to-day agreement.

• DO call if you are going to be late.

• DO reschedule if an appointment cannot be made as soon as possible.

• DON'T discriminate when hiring. Women make great technicians. Kids today are wonderful.

• DO take a mental health day once in a while. Go to the park or to the movies.

• DO aim for a company that runs without you. Picture receiving financial reports via e-mail at your Maui beach house.

• DON'T assume that telling someone to do something means it will get done. Put it in writing and follow up.

• DON'T assume anything.

• DO provide everyone with an "in" basket. Empty the in basket by the end of the day. Work gets done, filed or delegated.

• DON'T pay technicians on a commission-only basis.

• DON'T reward every employee the same way regardless of performance. The over-achievers should make more. Keep score and keep it objective.

• DON'T give a raise every year just because.

• DO create a compensation plan that combines hourly wages with spiffs for stellar sales performance.

• DO understand that a technician works at one speed: his or her own speed.

• DO recognize that the labor shortage is directly related to our unwillingness to pay skilled workers what they are worth.

• DON'T be fooled. The talented kids out there are not interested in $10 an hour for uncertain, seasonal, dirty work with no benefits.

• DO create an Operations Manual. Every job in writing. Everyone accountable.

• DO get input from the folks affected when putting an operations manual together.

• DO apologize if you are wrong.

• DON'T hold a grudge.

• DO more of what works and less of what doesn't.

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