Miracles Happen!

Miracles Happen!

I’ve been preaching the gospel of business success and personal self-esteem throughout the industry ever since the mid 1980s. In that time I’ve confronted thousands of “Doubting Thomas’s.” Their nay saying all goes along the same lines…

“Your methods might work for you, but not in my area…Frank, you just don’t understand my customers…You don’t realize how tough it is out there….I’d get killed charging more than $50 an hour.”

Well, I do realize how tough it is out there. And I do understand your customers. And what all of you doubters must realize is that it can work for you just as it has for me and countless others who have taken the medicine and started to operate their business the way it should be run.

Case in point comes from the example attached. By the beginning of last year the general manager of this company, based in Pennsylvania, recognized that he and the company were very ill. He admitted himself into the “Flat Rate/Business of Contracting” hospital.

It didn’t take the doctor long to diagnose the disease. This patient had been suffering from “Slug-o-mania”. The symptoms are quite apparent:

  • Low selling prices derived from other low selling prices in the market area.
  • Inadequate personal financial compensation.
  • Low gross margin.
  • Low net profit – a condition rapidly deteriorating to negative net profit.
  • No profit sharing or retirement plan.
  • Inability to discount, or even to pay some supplier bills.
  • Working 3,000-plus hours a year.
  • Wife and patient not getting along due to all of the above.

 

Taking The Medicine: Many patients exhibit one more symptom – an uncontrollable urge to rant against the doctor – “You’re crazy….your medicine won’t work in my area…flat rate pricing isn’t for me…I’ll lose all my customers if I raise my prices…Doc, you’re nothing but a slick seminar czar.”

Fortunately, this patient didn’t resist. He was open-minded enough to take the prescribed medicine. He got very well, very quickly. To illustrate, take a look at the financial summary attached.

Over nine long and hard years, this company earned a grand total of $512,403 in net profits on total sales of $21,175,046 (annual average = $2,352,782). Its average annual net profit was $56,934, or 2.4{938cd9e8dae860e800efc538277d4f7684e6f6981618ba70d1c34357a53c2e1f} of sales.

This actually wasn’t too bad by industry standards. About average. But a gaping wound opened early in 1994. The patient started to hemorrhage money.

 

Miraculous Recovery: Since visiting the doctor, the patient had recovered to the tune of $281,546 in net profit dollars. In just seven months this company made more than triple the best yearly profit made by this company in the previous nine years of slugging along.

The total profits were projected to $293,729. That would amount to more than half, 57{938cd9e8dae860e800efc538277d4f7684e6f6981618ba70d1c34357a53c2e1f} to be exact, of all the money made by this firm in the previous nine years combined. By the end of next year I expect the Blau medicine to total more net profit than in the previous nine years.

Not every patient turns around quite as fast as this one did, but my files bulge with letters from former patients, now friends, who have their own tales of recovery. Said one:

“(After taking the medicine) I crunched some numbers, determined my dollar-per-hour overhead and other pertinent costs of doing business. Then I painted my trucks, got a new cube van, hammered the Yellow Pages, got uniforms and your flat rate books and got down to business.

“Before attending your seminar, I owed $50,000 to a local supply house. Within one short year I wiped out that debt and now get my 2{938cd9e8dae860e800efc538277d4f7684e6f6981618ba70d1c34357a53c2e1f} discount. My techs will each make over $50,000 this year (twice what they made before). I hired an office manager, computerized, started a profit sharing plan, joined Contractors 2000 and almost tripled my salary in one year.

“Pretty fantastic huh? ‘Not in my area,’ my bleep!”

Here is another excerpt: “These past few years have been exciting ones for the author of this letter. I have had the good fortune to witness a gradual transition of a plumbing service business from one of mediocrity to one of first class proportions devoted to professionalism and excellence in all that we do.”

 

Caterpillar Procession: The situation of this industry reminds me of a true story about an experiment conducted by the French entomologist, Jean-Henri Fabre, with recessionary caterpillars.

These creatures get their name from the way they habitually travel in long lines following a leader. Dr. Fabre placed a group of these caterpillars on the rim of a large flowerpot until the leader was nose-to-tail with the last caterpillar. It was impossible to determine which was the leader and which were the followers.

In the center of the flowerpot, Dr. Fabre places an abundant supply of food. The caterpillars, however, paraded around and around in a slow procession that stretched for seven days and nights. One by one they fell away, until all died of starvation and utter exhaustion.

Life-giving food was only a few inches away, but slightly outside the path in which they followed the leader. Because of their instinctive and habitual recessionary behavior, they perished.

Our industry is filled with recessionary contractors that follow similarly inclined contractors on a circular road leading nowhere. It’s time to break away from the pack and save yourselves. Reach out for the life-saving medicine.

Miracles Happen 2