Tuesday, May 20, 2008

You and the Economy

Do you listen to the economic forecasters?

You shouldn’t.

Why, you might ask?

Because all those talking heads you see on tv and the articles on-line and in the newspapers discussing recession, inflation, and the housing market crisis are generalizing the economy for the entire country.

The truth is that the economy is not the same in all areas of the country. This is an awful big nation! And you will find differing economies in different regions.

An even bigger truth is that within each region and even within each county and city you will find some areas where homes are selling well and people have jobs and money. There will be other areas where things are not so good.

The geographic area that our remodeling company serves also happens to have the highest foreclosure rate of any other county in the state. If I bought into the doom and gloom, I’d probably just close up shop for the next several years and wait it out.

But I don’t buy it! At the beginning of the year we set our company goals high. And, guess what? We are right on track.

How do you keep all of those negative commentaries out of your head? It’s simple. Turn them off! Turn off the talking heads and the daily economic gloom.

Instead listen to something positive. Buy some tapes on selling strategies or marketing. Listen to a motivational speaker. Anything but the negativism.

Because the only economic forecast that really matters is the one that you create in your own head.

Monday, May 12, 2008

What Is a Small Remodeling Company, Anyway?

Have you ever thought about what being a small remodeling company means?

I started to think about the connotation of the word “small.” I even went to the dictionary to look it up. And sure enough, “small” did not have the positive message that I was hoping for. According to Webster's Revised Unabridged Dictionary, one meaning of small is “Being of slight consequence; feeble in influence or importance; unimportant; trivial; insignificant; as, a small fault; a small business.”

Wait! A small business--insignificant? Unimportant? That is definitely not the meaning I was expecting! And yet, that was exactly why the word “small” was bothering me. It just doesn’t fit. It’s not what small business is all about. And I’m sure it’s not what your company is all about. So I set out to find another word that meant small but had a positive ring.

Interestingly, the US Census Bureau does not define small and large businesses. Instead it provides “statistics” that it says “. . . allows users to define business categories in any of several ways.” You can visit those statistics on-line . Looking at the statistics for nonemployers (those companies that do not have employees), I find that these companies account for over 75% of the firms in the U.S. but only account for 3 ½% of the revenue. That makes sense. And that’s not even counting the companies who have a couple of employees. So I guess if I was looking at the pure number of small companies versus large companies, defining a small company as insignificant is a misnomer. But looking at revenues, it’s not!

Now the US Small Business Administration does define small versus large businesses. And checking the Specialty Trade Contractors found in Subsector 238 under Construction, I found that the cut-off for small versus large is $13 million. Wow! That’s a lot of money! I dare to say that many remodeling and trade contractors would never come close to making $13 million in a year.

And then I became curious as to how many remodeling and trade contractors do actually make more than $13 million a year. I checked out Qualified Remodelers Top 500 listing for 2007 and found that only 69 contractors out of 500 fit that bill. That’s a little over 13% of the list. That leaves a good 86% of the Top 500 remodeling companies in the country that are considered small businesses.

So now I’m seeing that “small” as in small remodeling company cannot have a negative connotation when a majority of the businesses in this industry fall in that category.

Monday, May 5, 2008

Build Your Own Field of Dreams

The other night I couldn’t sleep (a result of too much on the mind), so I aimlessly flipped through the channels until I came across one of my favorite movies, “Field of Dreams.” The premise, in case you’ve never seen it, is that an Iowa farmer receives messages from “the beyond” to “build it and they will come.” He proceeds to plow over perfectly good fields of corn (a cash crop) and erects a baseball field, complete with lights and stands for visitors. His wife thinks he’s crazy, his family thinks he’s crazy and his community thinks he’s crazy. But then other people start seeing the ball players who have come to play at Ray’s Field of Dreams – ballplayers from the past long since dead. And his wife and young daughter start to believe. He is sent more messages from beyond and Ray sets out on several adventures, picking up a famous writer and then a doctor who once played with Shoeless Joe Jackson.

Many ascribe the “Build It and They Will Come” philosophy to how not to build a business. There is a valid point there. Many businesses have failed because the owner did not find out if his or her product or idea is a viable one.

But in the movie, the voice beckons, Ease His Pain. And isn’t that exactly what we try to do in our businesses. We are trying to ease someone’s pain.

But easing just one person’s pain will not get you very far in business. Hopefully there are others with the same pain that need the same service.

And in the movie, that premise plays out at the end. Ray’s pain of having separated from his father at an early age is healed. At the dramatic conclusion, we then see a column of headlights as far as the eye can see down that rural Iowa farm road. These are others with the same or similar pains, coming to be healed.

Now I know it’s just a movie, but the similarities are there. We find someone with a problem. We solve it. We test to see if there are others with the same or similar problem. We find them. We tell them about how we can solve their problems. Only then will they begin to come.

You can build your own field of dreams. But don’t expect your business to flourish just because you’ve begun a new enterprise. There is a lot of work involved in getting those people to know you are there and to believe in you enough to buy from you.