As we get ready to head into shoulder season, the election, inflation, & recession are adding financial pressure this off-season. Leads are down, while contractor appetites for more are up, resulting in higher lead costs because of supply and demand. Not everyone will win the lead battle, despite possibly spending more money. Less leads spread across the same number of contractors creates downward price pressure in the market because of higher capacity with lower demand. Bottomline: We need to do more with less.
The typical first reaction is to cut costs, but HOW?
It used to be that whoever controlled the marketing controlled the market, but as the industry labor gap widens every year that’s evolving into “whoever controls the labor controls the market”. You don’t want to lose qualified people in the “cost cutting” process. You must balance traditional cuts with increasing operational efficiency to achieve the same or even better results.
Things we don’t want to cut during belt tightening:
- Marketing – cutting when you’re short on leads will only result in a bigger shortfall, starting a spiral effect
- Pay Rates – don’t mess with people’s pay, because they are receiving “unofficial offers” from your competitors all the time
- Employee Benefits – basically the same as cutting pay rates
- Training – competency is crucial to improve job times, reduce callbacks & warranties, and increase satisfaction
- Quality –
Ask Your Team for Ideas
Transparency is crucial to prevent spooking your team. They’re feeling financial pressure and chances are they know you are too. Simply share what you’re seeing and ask for their help. One of the best approaches is to ask, “If you were in charge, what are the first three things you would do to save money or increase efficiency?” Your team usually already knows where the leaks are, especially for their area of expertise. You might have to prime them with some examples, like “What if we booked just one more call per day?” or “What if we ran one less callback per week?”
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