Using the magic word ‘CAPACITY’ to manage your business through the busier months
With the arrival of spring, many trade & constructions businesses experience an uptick in the volume of work. When the sun is out, human beings experience a shift in their decision-making energy and act on areas that they have put off through the winter months. Leading up to the holiday season in summer, the air conditioning either needs servicing or installation, outdoor areas and landscaping require renovation or refurbishment, the ceiling fans and internal appliances require maintenance, and the list can go on.
Historically what can happen is the following:
Businesses that have felt the effect of the slower months now experience an influx of inquiries, and without a structure on how to qualify, or disqualify potential business, they can end up saying ‘yes’ to everything and anything. Sound familiar?
A strategy is required to ensure that the overwhelm that can flow off the back of this ‘silly season’ is minimised. This way a business can say ‘yes’ to the work that is important, ‘no’ to work opportunities that don’t fit, and generate the profits required for the business at the same time.
Firstly, a question.
Is it essential to know the businesses work capacity? The answer is no…however I suggest that knowing your capacity will give you a higher probability of reaching your profit goals than if you didn't.
Take this scenario…You call a company to enquire about using their services. During the call the person handling your enquiry mentions the following statement.
"It's great that you called today, because we are nearly at capacity for this month/season intake of jobs."
When you hear that statement, what subliminal message does it sends?
The message, without mentioning it, is that we are good at what we do, because we are nearly at capacity (it's like a restaurant that only has a few seats left), and it also states I need to make a decision quickly if I would like to take advantage of their services. This means that the buying cycle shortens. These are the first two benefits of knowing and stating you are close to capacity.
Let's explore a few more.
- Knowing your capacity relieves the scarcity mentality of many business owners that says, ‘more is better’, and that you need to say ‘yes’ to every job that comes along. When you say ‘yes’ to every job that comes along, you are also saying ‘yes’ to smaller profits. Have you ever accepted a job just for the sake of filling the calendar versus making a profit?
- When you say ‘yes’ to every job that comes along, especially at a busier time of year (leading up to Christmas) then several negative consequences occur. Your inability to say ‘no’ means that you are now possibly cramming the schedule which puts pressure on you, and your team to deliver. The quality often suffers, which can then flow onto rework/faults, which takes extra time and costs you your profit. The customer usually ends up unhappy because it takes longer, and you have overpromised the ability to deliver. No one wins. Could this be you?
- The final benefit to knowing your capacity is it takes the pressure off you to have to continually sell, sell, sell. If you come from a place of abundance versus scarcity, and confidence, particularly if you know your numbers and the exact number of projects required to meet your targets.
If you would like some assistance to implement the information above, please connect with the team at PROTRADE United.
Written by Jon Mailer
CEO of PROTRADE United
Author of ‘Not Just a Tradie’
