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Breaking Away From The One Thing You Do

By Al Levi
December 6, 2009


I joined in on a teleseminar call the other day that my consulting partner was hosting. The blog talk radio show interviewed guest Jack Stack. He has become famous for engineering a monumental turnaround at his company years ago by sharing the score with all employees and teaching them business financial basics.

Jack’s written a lot of good books over the years, but I’d suggest you pick up a copy of “The Great Game of Business” and learn the power of giving your staff a stack in the game.

But, what really intrigued me was when Jack said that despite the successful turnaround of their meat-and-potatoes business of rebuilding engines they were smart enough to know they needed to diversify. And they’re sure glad they did!

The recession would have hit them hard had they not looked out and seen how exposed they were.

And for us, it’s no difference if we still only do one trade or only one particular type of segment of the marketplace.

My family and I could see years ago that despite running a successful heating business we risked losing customers if we didn’t give them all they wanted in the way of products and services, plus we could suffer massive economic impact because we were so weather dependent. A new threat was on the horizon with the utility companies who had shunned service in the past and were now ramping up to enter the market.

We decided that we’d have to move away from just doing heating and instead we’d seek to “Own the customer’s basement.” Simply put, this meant we’d provide plumbing and air conditioning, as well as heating.

We knew we needed some heft to begin with and we also lacked the know-how to make the trade a bonus and not a headache. That’s why we sought out partners who had the size and the brains to allow us to seamlessly add the products and services we lacked. It worked great and it’s still working great!

It worked because adding additional trades was easier for us than it would be for most. That’s because we had already been acquiring companies in our field for years. We also had built operations manuals and training centers for everything we did. So, all we needed to do was find the right fit for adding to our list of offerings, creating something that was systematic and repeatable.

We also made the decision about what trades we wouldn’t do. For us, we had no interest in becoming a home security alarm company despite the threat from one competitor who did both heating and alarms. We instead sought out an alarm company who assured us they had no interest in doing what we did and we let them know we felt the same. We signed a stand still agreement (fancy for a promise not to enter one another’s business), and we setup a partnership to stop our loss of customers and they did the same. We both benefited from being able to send in the “expert.”

So, what’s holding you back from doing the same at your shop?

In these economic times, can you really afford to continue to shun the diversification you need?

Now is the perfect time to diversify because acquisition is never going to be cheaper, and your need to spread out your risk and increase your call count will never be higher.

Announcement:

The Step by Step Success program solves the “Contractor Overwhelm” issue by offering one simple, powerful business building Step at a time. Through interactive Teleseminars and one-to-one coaching in Office Hours, Al Levi and Ellen Rohr will help contractors implement ONE action each month that will help them make more money and start living a better life. 

One simple Step…one problem SOLVED every month. Topics include…
  • Firefighting 101 teaches you how to handle ANY problem…Once and for All. 
  • Establishing yourself as someone worth playing with, following…and fighting for. 
  • Launching Laser-focused Direct Marketing to get Massive Results on a Shoestring Budget.

Learn more at www.StepByStepBusinessBuilding.com.

Links

  • Give Me 60 Minutes And I'll Show You The Secrets To Running A Profitable Service Business ... Even During A Recession!

Share This Story

Al Levi has been helping plumbing, HVAC, roofing, remodeling, electrical and carpentry businesses solve problems, turn greater profits, and help owners get their lives and free time back for over 7 years. This is all based on his 25-year career at his family-owned and operated contracting business. For more information, visit www.60minuterecessionsolution.com.
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