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The 3 Mistakes Contractors Should Avoid This Summer

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Are you struggling to keep up with the day-to-day summer grind of running your trades business? Not to mention finding time to work on things that move your business forward?

I get it, I’ve been there myself and seen it time and time again. Having grown a multi-million dollar home service business and coached hundreds of entrepreneurs through it, I understand the challenges you’re facing and have also seen what it takes to get through it successfully. So what separates those who work 80 hour weeks to the point of burnout, and those who maintain balance while profitably growing their trades businesses to the next level?

Here are the three mistakes that successful entrepreneurs avoid at all costs, especially in the busy summer months:

(Stick around to the end to download free resources that’ll help contractors hire and prioritize better, as well as properly track their gross profit margins).

Mistake #1 – Hiring “B” level staff to urgently fill crews

We’ve all been there – a team member or two quit without notice with a full production schedule coming up, and suddenly you’re scrambling to find anyone that can get work done. What we know is that 8/10 times the rushed hire is not going to succeed in the long-run and that no employee is worse than a bad employee. After painfully learning this lesson myself multiple times, I’ve gone to great lengths to push back my production schedule (often with an annoyed customer on the phone), because I know that it is the right decision in the big picture.

So the next time one of your employees suddenly quits, take a breath, and follow this process:

  1. Look at your upcoming production schedule and create an “options list” of all the crew combinations you can shuffle through in order to keep production on pace. If not possible, call the upcoming customers to tell them that you may be later than expected because you are holding up quality through challenging work.
  2. Utilize all of your recruitment channels to put out recruitment ads that are specifically written to speak to your ideal candidate.
  3. Pre-plan time in your schedule over the next two weeks to focus on recruitment related activities: posting ads, calling potential candidates for thorough conversion calls, completing in-depth interviews, and following up with top candidates.
  4. Pre-plan time in your schedule for a full week of training with new staff about two weeks out. This thorough training time will set up your future staff for success in their role and end the cycle of turnover.

Our members at the Breakthrough Academy follow a methodical recruitment process to attract “A” talent and select the best candidates through behavioral interviewing.

For a complimentary copy of our hiring templates and guides, hit the download button at the bottom of this post and we’ll send them right over.

Mistake #2 – Lack of focus on gross profit margin

Gross profit margin (revenue less your variable costs: labor, subcontractors, materials, etc.) is the #1 indicator of how well your business is running. In the landscape construction industry, for example, attaining a gross profit margin of around 36% is critical in achieving a profitable year.

In busy times, it’s easy to get away from regularly tracking your gross profit margins on the jobs you’re completing. Successful trades business owners track the gross profit of each job as soon as it is completed, and often partway through. These results are measured against goals and help make changes in day-to-day operations. For example, we may notice that a particular crew is always over-budget on their labor budget, and then investigate why that is happening with them. This way, changes can be made early-on to bring jobs back to that 36% gross profit and help bring in a profitable year.

Over the years, we’ve developed a simple yet highly effective system for tracking variable costs and gross profit margins on jobs. Our members use it to track their numbers weekly, and it’s helped raise the profitability of dozens of trade businesses in our program. Best of all, it’s available free of charge, included with the downloads you can grab at the bottom of this page.

Mistake #3 – Prioritizing the wrong tasks in your week-to-week schedule

Here is one truth that I’ve seen proven countless times: what got you here probably will not get you there. The type of work that will take to grow your business to the next level is very different than the type of work that has gotten you to this point. I often see entrepreneurs spending less than 10% of their week working on tasks that truly make an impact on moving the business forward. Menial tasks such as getting materials for crews, dealing with customer complaints, getting vehicles fixed, etc. will not allow you to focus on the priorities that impact growth.

Working on tasks that influence long-term results requires methodical and intentional planning. Yet, I see very few business owners spending a focused two hours each week to review results, set goals for the week, and outline weekly action plans to achieve their goals. It is this disciplined “Goal Setting and Review” process that has been a staple in the rapid growth of hundreds of companies we’ve worked with.

Entrepreneurs who are serious about profitably growing their trades businesses must follow this weekly ritual to spend a focused two hours at the beginning of each week mapping out goals and priorities, without distractions of the day-to-day. Our Breakthrough Academy members use a “GSR Dashboard” weekly to help them understand their results and set goals moving forward. This form, which has helped drive results for countless business owners, is also available to you to download below.

Request your downloads below and don’t hesitate to contact us if you have questions or want to learn more about how we help contractors run successful businesses without having to work 80+ hour weeks.

Danny Kerr
Managing Partner

Danny is a managing partner at Breakthrough Academy – a program designed to guide entrepreneurs running trades and service companies to profitably grow their businesses.

Coming from a modest upbringing and numerous learning challenges with Dyslexia, Danny learned to work very hard from a young age. Through university, Danny started running a painting business that he quickly grew, eventually employing 12 full time staff. At 20 years old, he took a leadership position for a franchised painting company and grew sales from $400,000 to $1,300,000 in one year. After many years of rapidly scaling his painting business, Danny followed his passion in coaching entrepreneurs and has led hundreds of business owners to realize their potential.

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Igor Trninic

Igor Trninic

Igor moved to Canada at a young age, where he learned the value of hard work as he watched his family rebuild a thriving life in a new world with extreme change. Most of Igor’s early learning came from competitive sports, where he learned how to hustle and lead. This learning transferred well to business, when he started running a College Pro Painters franchise at 18 and quickly grew it to one of the top franchises in Canada. After finishing an honours degree in Accounting and HR at the SFU Beedie School of Business, he decided to leave the dull world of numbers and followed his passion of developing people and businesses. He fell in love with leading great people and growing companies to their potential.

Working at College Pro as a General Manager for the franchisor, he tripled the revenue of his division in three years by hiring and leading great managers. Here, Igor saw the power of combining amazing people with strong systems to drive scalability. After College Pro, he chose to test these principles on a new venture with the launch of Shack Shine, and together with the guidance of a highly experienced trades entrepreneur, they grew the company to a full scale franchisor within a year and a half. Shack Shine was eventually acquired by 1-800-GOT-JUNK to be scaled across North America and Igor launched the Breakthrough Academy to guide trades and home service entrepreneurs grow their businesses through proven principles. Igor has a passion and true care for developing people and their businesses, which has formed the foundation of Breakthrough Academy. His work in developing BTA has recently been highlighted in Igor’s Top 30 Under 30 selection by BC Business Magazine.

Igor resides in Vancouver, British Columbia and loves to take on all the adventure that BC can offer. From hunting to skiing to downhill mountain biking, any outdoor adventure is up his alley.

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