Business is Booming. Why Am I Going Broke?
It's an all too familiar scenario: a successful restoration contractor decides to expand his business. Things are going so well right now, and this is the time to capitalize. Maybe he opens a satellite office to handle more work. Perhaps, he decides to expand his offerings to include asbestos abatement, or even reconstruction services. Maybe he goes out and hires a few hungry marketers to expand his footprint.
Everything goes great! The marketers are bringing in new work, and that asbestos division is really proving itself out. Better yet, the new location is really making the response time shorter, and the customers are loving it!
The thing is.... every week, it is getting harder and harder to make payroll, and the payables are really starting to back up. Worse yet, the collection times have nearly doubled from just a few months ago! There is more business being done, so where is all the money going?
There is a simple answer to this question but no simple solution to solve the problem. The answer is this: the more complex the company, the more money that it takes to operate it. And sometimes, that need can grow far faster than the additional revenue that comes in.
I see this in every business, not just in restoration. The difference in our field is that we usually don't have "regular" contracted business, like a paper manufacturer would. Trying to grow a business without being able to accurately project your revenue makes what we do far more difficult. It's a real "guessing game", and without true experience and knowledge of these variables, we are shooting in the dark.
Remember, you are making a transition from an OWNER-OPERATOR to an OWNER-MANAGER. In the restoration field, more than half of the companies that try this transition will FAIL! A company set up as an owner-operator model cannot simply "flip the switch" and morph overnight into one in which you are the manager of a complex, multi-faceted business. It takes a complete and thorough look in the mirror, and a willingness to change.
Here's the good news: IF YOU WANT IT, YOU CAN HAVE IT! All over the country, restorers are making the transition, and they are loving their newfound success. The tools are out there for you, if you know where to look. For nearly a decade, I have been helping these companies fulfill their dreams. If this is something that you desire, drop me a line and we can look at ways to make it happen for you. Whatever you decide, know this- the best business dreams happen with your eyes wide open!!!