Road to Success

This year, even with the slow economy, we saw our highest profits ever. We had to work hard to succeed, but the key advantage is that we’ve worked a lot smarter. My wife Deanna and I run Mason Mechanical, a 29-person, full-service mechanical contracting firm in Mesa, Ariz. Rather than outsourcing or hiring for management responsibilities, we like to be deeply involved with all of the day-to-day decisions.

What has kept and is still keeping our firm from being a casualty of the times was the realization that we needed to make some serious changes. Through extensive contractor training sessions we’ve attended, we knew that two major issues needed to be addressed. First, the organization and financial analysis of our firm was a real mess. Secondly, we also wanted to be able to rely entirely on referrals to drive new business.

In 2006, we started working with Seattle-based Business Development Resources, Inc. (BDR), a training and coaching firm exclusively focused on the HVAC/R Industry. Their Profit Coach program offers guidance specifically focused on contracting firms. When enrolled, you’re assigned to one of their skilled specialists who analyze all facets of your firm to reveal where improvements need to be made.

From the moment we first applied their insights and recommendations into the management of our business – it’s grown in profitability.

Change is a good thing

Our company needed to be re-organized. We broke down our financial statement by departments, no longer looking at one big, vague bottom line like we had in the past. We examined each department individually to see where we were making money ... and, more importantly, where we were losing it. For us, our service department was a key concern.

In the Southwest, service work is seasonal for obvious reasons. For the better part of the summer it’s not unusual to go weeks with daytime temps at 110°F. Another aspect that makes service less profitable: good technicians don’t come cheap. But if you don’t have good techs, your service department is doomed to fail.

Our profit coach took a look at our list of service accounts and recommended how much time we should be spending on each one. He also set guidelines for how much money each individual account should be making. It came as no surprise to learn that we had several accounts that weren’t making the company any money at all.

Now we also analyze our finances every month, giving us a clear picture of what changes needed to be made; it’s a big improvement over wondering where money went at the end of the fiscal year. There’s no way to be responsive and proactive about making changes to your company if you don’t carefully, and frequently, look at the numbers and immediately act upon what you see.

But keeping a tighter rein on company finances isn’t the only benefit of running an organized business. It makes for better, more productive employees as well. BDR co-owner Barry Burnett once explained this to me.

He told me that a company’s employees — just like everyone else in this fast-paced world — have a lot going on at home. They probably have kids bouncing off the walls, errands to run, projects underway, you name it. If you can provide them with an organized, well-structured work environment, one that lets them regain their focus, you’re going to get better work out of them. Ultimately, coming to work in the morning is going to be more appealing.

Small things make the difference

Our second goal was to generate all of our business through referrals. From BDR’s “The Perfect Lead” seminar that we attended last March, we learned a lot about another part of the business, lead generation. From product and company branding, to social networking, spiff programs and quality control, The Perfect Lead thoroughly covered all facets that will help us reach our goal this year of becoming a 100% referral-driven company.

I believe that in today’s difficult business environment, the most important asset that a contractor can have is a consistent, high-quality lead generation process.

We learned that lots of little things make the biggest difference, things that you think you should know, or should have thought of on your own. For instance, all our guys now wear disposable booties when they enter a home and everyone wears matching uniforms. If our technicians are going to be touching finished walls, such as installing a thermostat, they wear latex gloves.

We want every client to refer us to their friends, as the most professional, friendly contractor they’ve ever dealt with. We’ve also begun sending out newsletters twice a year. Our whole mailing list gets updates about the company and specials that we’re running at the time. It keeps Mason Mechanical fresh in their minds, and it is relatively inexpensive.

BDR helped us see the importance of developing a genuine company culture that plays a key role in identifying who we are during and after company hours. Our service department is up 50% since last year as a result of the changes that BDR suggested, which we implemented.

My wife and I first heard about BDR in 2001, but we didn’t start working with them until ’06. My only regret is not beginning our involvement sooner when we first had the opportunity. In a nutshell, they’ve converted me from an air conditioning mechanic into an entrepreneur.

Five percent of contractors train their employees at this level. Statistically, we know that about 20% of those who seek this level of education actually implement what they’ve learned. That means there are only about 1% of all the contractors in the nation who are truly getting it done. We’re glad to be among them.