King's Corner: Business Success by the Numbers
Before becoming the owner of Guardian Roofing and Windows in
Tacoma, Wash.,
Aaron Santas worked as a branch manager for a major construction materials
distributor. Santas worked closely with a lot of contractors, and he found out
that the successful ones had something in common. “Successful contractors watch
their numbers, and they know them intimately,” he said.
Before becoming the owner of Guardian Roofing and Windows in Tacoma, Wash., Aaron Santas worked as a branch manager for a major construction materials distributor. Santas worked closely with a lot of contractors, and he found out that the successful ones had something in common. “Successful contractors watch their numbers, and they know them intimately,” he said.
Business training is essential, asserted Santas, who shared his financial statements and pricing formulas with Best of Success attendees in a session titled “Business Training, Balance Sheets and Gross Profit.”
“Not knowing the numbers is like going through the wilderness without a map,” he said. “You might make it, but you’ll have some hardship along the way.”
The key to budgeting is to understand the financials and use them to set expectations, said Santas. “What’s killing business is people don’t know how to price their jobs properly,” he said.
Santas used his own company’s budgeting process as an example. “We started our business in 2005,” he remembered. “We saw the impending recession, and we knew everything would come to a screeching halt.” Despite the tough economy, Santas on his co-owners knew they would have to set aside more money for marketing, raise prices, improve their value propositions and improve service. They used their detailed financial reports and profit and loss statements to determine what they could survive on and set the budget for the coming year. “Your P & L can be used to plan where you are going,” he said.
Santas noted his company sets aside 7 percent of its budget for marketing. “Living by the Yellow Pages and referrals - you’re not going to live by that, you’re going to die by that,” he said.
The key is to business success is to understand the numbers and make decisions accordingly. “Making emotional decisions with your money leads to what? Failures,” he said. “That’s why they call it a good business decision.”
Before becoming the owner of Guardian Roofing and Windows in Tacoma, Wash., Aaron Santas worked as a branch manager for a major construction materials distributor. Santas worked closely with a lot of contractors, and he found out that the successful ones had something in common. “Successful contractors watch their numbers, and they know them intimately,” he said.
Business training is essential, asserted Santas, who shared his financial statements and pricing formulas with Best of Success attendees in a session titled “Business Training, Balance Sheets and Gross Profit.”
“Not knowing the numbers is like going through the wilderness without a map,” he said. “You might make it, but you’ll have some hardship along the way.”
The key to budgeting is to understand the financials and use them to set expectations, said Santas. “What’s killing business is people don’t know how to price their jobs properly,” he said.
Santas used his own company’s budgeting process as an example. “We started our business in 2005,” he remembered. “We saw the impending recession, and we knew everything would come to a screeching halt.” Despite the tough economy, Santas on his co-owners knew they would have to set aside more money for marketing, raise prices, improve their value propositions and improve service. They used their detailed financial reports and profit and loss statements to determine what they could survive on and set the budget for the coming year. “Your P & L can be used to plan where you are going,” he said.
Santas noted his company sets aside 7 percent of its budget for marketing. “Living by the Yellow Pages and referrals - you’re not going to live by that, you’re going to die by that,” he said.
The key is to business success is to understand the numbers and make decisions accordingly. “Making emotional decisions with your money leads to what? Failures,” he said. “That’s why they call it a good business decision.”