Paul Riddle
Contributing Writer
Success Group International

On average 18 service vans would crash each month in a moderately populated city, according to insurance experts.  How do they know that?  It’s history.  Using their actuary tables, they can predict when and if service vans will crash and burn.  They know what days most of them will crash, how rain, snow, and sun will affect this number, how many injuries will result from those accidents, and how many fatalities will happen.  They know this all from studying what’s happened in the past.

Will they always be right in their predictions?  Of course not, but these predictions allow them to set the premiums they need on the automobiles they statistically know won’t crash to offset their statistically proven crash and burns.  They can set their rates so they end up in a profitable position at the end of the year.   Do you know how much revenue you need to offset your expenses of being in business?  Do you know your history as well as the insurance companies?

How many contracting businesses will crash and burn this year?  We don’t have a precise number for that statistic, but we can guarantee it’s more than 18!  How do you avoid crashing and burning?  It starts with focusing on building wealth, generating revenues and boosting your sales.  To do that, you must focus on these three areas daily:

Know what you need

The simplest way to know what you need is by determining your average invoice.  Average invoice?  What’s that?  Figuring out your average invoice is a quick process.  Take last week for example.  Pull every service invoice you had for the week and add the revenue from each call.  Let’s say you ran 20 calls and your total revenue was $3000.  Now, you simply divide your total revenue by the number of calls you ran, including the calls where no revenue was generated.  In this example, your average invoice is $150 ($3000 ¸ 20).

Once you know your average invoice, you’ll know how many calls you have to run to generate the revenue you need to avoid crashing and burning.  Now your focus is to get that number of calls.  Share that number with your team each morning and track it throughout the day.  If you’re falling behind on this goal, it’s up to you to make it happen.  Don’t sit around and stare at the phones.  Start calling your customers with a special offer or schedule your yearly maintenance agreement visits.  If you don’t know what you need every day to meet your goals, you’ll be headed towards “crash & burn.”

Boost what you have

Boosting your revenue comes from, first, maximizing the number of calls you book from the calls that come in.  Your call taker should have a highly effective script for booking calls and you should train them frequently on this script.  Here’s a tip.  Mystery shop your call-takers and record them.  Then, use these recordings in your training sessions.  If your average invoice is $263.00 and they miss one potential service call a day, you’re losing $68,380 in lost revenue each year, so training is crucial.

Secondly, your technicians must also make the most of each service visit they run in a day.  That doesn’t mean taking advantage of your clients because that is never the goal.  It means doing what is in the client’s best interest.  This will maximize the amount of revenue available on each call.

Boosting what you have comes from training.  Train your call takers to turn as many incoming calls into booked calls as possible.  Train your technicians to offer options to your clients that are in their best interest.  Training your employees in these areas will boost your sales and the money you make every day.  Do you have a training schedule this week?  If not, you could be headed for a “crash & burn.”

What gets measured, gets improved

If your focus is on sales and meeting your goals every day, then this step should be a no-brainer.  You have to track your results to see if you are meeting your goals.  Doing so will show you where you have to improve and what you must do differently to meet your goals.  You’ll see where your team needs more training, and you may even end up changing your goals.

Focusing on sales every day takes a top-down commitment.  As the owner, that commitment must start with you, and you must pass it on to your team.  Get your team excited about hitting their goals.  Show them why revenue and profit are important to the future of your company and to their future success.  Getting your team involved in this daily sales focus will help refocus them on the most important goal – service success, and it will help you avoid crashing and burning.

About the Author: Paul Riddle, Vice President, Success Group International

Paul Riddle has over 25 years of hands‐on experience as GM, COO, CEO, and owner of service companies specifically in the mechanical and restoration segments. Throughout his career, he has personally trained the owners and employees of hundreds of businesses, including several turnaround situations.  His hands‐on training for owners and their employees has been in the areas of business planning, sales & marketing, and company culture. Paul enjoys applying his knowledge and experience working directly with business owners and their employees to increase profits, improve the company’s present value, and unlock the intrinsic value of the business when sold. Paul joined SGI in 2009 as the VP of Operations.