Face it, the vast majority of plumbing contractors own jobs, not businesses. They are jobs that bind them, restrict them, and suffocate them. Anxiety is ever present, if never mentioned. Here are seven questions you should ask yourself about your plumbing company.
1. Can You Take a Month-Long Vacation?
Small contractors like to brag that they can take off anytime they want. After all, they are their own bosses. Yeah, yeah, yeah. But can they take off any week they want? Does revenue dry up if they do? Getting a buddy who also runs a small shop to cover their calls is the way many handle it when the spouse absolutely demands a week off. Hopefully, the buddy will be trustworthy and the vacationing contractor’s customers will not become the buddy’s customers going forward.
Of course, a week is not really a test. A month is better. If a contractor cannot take off for a month, he does not have a business that can run without him. It is a company that he is chained to.
2. Will Your Company be Salable One Day?
In the end, the goal of every contractor should be to build a business that can be sold. The contractor may choose to pass it along to the kids or sell to employees, but the company should still be in a salable condition. A company that cannot be sold is a company that has no equity. A company that cannot be sold is not even a business. It is a job. If a contractor owns a company, he works for it. If he owns a business, it works for him.
3. Is Your Company Growing?
Some plumbing contractors do not want to grow. They should understand the consequences. Everything in life: plants, people, and organizations are growing, stagnating, or dying. Few things can stagnate for long before beginning a decline. A dying company is a weight around a contractor’s ankles. It is not fun as it drags him down. And, it is not going to improve on its own.
4. Do You Have Too Much Month at the End of Your Money?
Plumbing is a great profession, one that should and can be financially lucrative. When a contractor is struggling to meet his financial obligations, this is another sign that he is a slave to his company. Again, a business should work for the owner financially, not the reverse. A business should reward the owner financially. It should not drag him under with the weight of its obligations.
The first gut check for a financially troubled company is pricing. Most plumbing companies undercharge. It is the most common problem found on the business side of plumbing and fortunately, the easiest to correct. Ironically, contractors who are going under by charging too little are afraid of raising their prices. Why not? It is not like the current approach is working.
5. If You Cannot Work, Is Your Family Protected?
What happens if the contractor gets in a serious accident and is unable to work? Does the revenue flow from the company evaporate? Is the family suddenly in financial jeopardy? This is enslaving.
By contrast, a true business will continue to provide the owner income, even if the owner is unable to work. This is empowering. At the very least, contractors invest in good insurance, even if it is expensive.
6. Do You Control Your Lead Flow?
Depending on a search engine, referral site, big box retailer, or warranty company for business may be a temporary means of generating work, but contractors should endeavor to take control of their own lead flow. Lead flow is a company’s oxygen. Contractors who depend on others for the oxygen they need are not only slaves to their companies, they are indentured to the lead source.
7. Does Your Company Provide You the Lifestyle You Want?
As much fun as business can be, the ultimate purpose of a company is to provide the owner and his or her family with a lifestyle. Building a business can be intrinsically satisfying and rewarding, but it is providing the extrinsic lifestyle the owner wants to enjoy that is truly empowering.
How about you? If you answered “no” to any of the seven questions you are at risk of being a slave to your company. This is only a problem if you remain in chains. Breaking the bonds is completely up to you.
At one point, every plumbing company was little more than a job for a self-employed plumber. It is not where you are today that matters. It is where you will be in a year, two years, or five years. Are you going to break the shackles of indentured servitude to your company and build a business that works for you, rather than the reverse? Freedom starts with the decision to be free.
Learn more about building a plumbing business that works for you at the Service World Expo October 16-18 in Las Vegas. Mix with the best plumbers, consultants, and manufacturers in the business. Visit www.SWEShow.com for more information.