The winter season brings its usual slow onset of business, but it doesn’t mean contractors have to go into hibernation. There are plenty of opportunities to stay busy and be profitable in the offseason
Being able to maximize your business’ effectiveness during the offseason for any contractor or company is one of the pillars of a long and profitable career. There are many companies who deserve credit for having honed a razor sharp sense of timing – who persuade their customers with specific services that are very successful during the winter months. To be successful all year round means being in tune with your customers, knowing what they want and need, and at the same time – being in step with your business needs.
Expanding your services
Some entrepreneurs in the contracting industry, particularly in the northern regions, face harsh challenges as a result of geographical location and bad weather. Projects are few and far between in the winter and working conditions can be tough. When the cold weather sets in, some contractors are signaled to close up shop.
At the same time, other contractors may brace themselves for a highly busy and rewarding season.
Many of these businesses that deal with rough winter weather have adapted and seized the opportunity to include new services in order to survive the adverse weather conditions. Popular services are holiday lighting, decorating and snow removal. Some even contract Christmas trees. I’ve heard of contractors providing carpet cleaning services, air-conditioning & heating services during the winter and some who even keep busy repairing snowmobiles.
In recent years, many contracting businesses have adopted Home Performance and Energy Efficiency services – a valuable set of services that contractors can provide all year round as well as during the offseason, with many homeowners becoming increasingly aware of the importance of being energy efficient.
Of course, you should consider all your options and count the costs and paybacks to be expected from a new offer, weigh the capabilities of your staff, and take the lead with the new service with these aspects in mind.
Convince your clients to do interior remodeling during winter. It is a good use of their time – when the climate is unfavorable outside – to spend time renovating indoors. In general, people are keen to take advantage of undertaking interior renovations in the winter. There is a climbing demand for interior painting, flooring, cabinetry, etc. to be done indoors during this time.
Contractors’ prices are generally expected to be discounted in winter, so many consumers will shop for bids to see if they can save on their interior projects. Other contractors though, manage to stay busy without tampering with their own fees – harnessing their established client accounts and relationships.
In some parts of the country, where the weather is still hospitable enough to open up the windows for a draught of air – it is ideal to do interior painting. Paint likes the cool “stony” weather. In the more southern regions, you will find yourself in the perfect painting climate.
Look out for interiorscaping opportunities. Many people put their backyards in the house when the ground freezes over – or bring their plants indoors to protect them from the chill. They will be open to making the most of the warm indoor setting and to create a unique garden backdrop inside their homes – complete with indoor water features, decorative indoor lighting, and seasonal plant life. There is bound to be many customers who are interested in finding someone to help protect their plants while also having a an eye for interior decorating
Involve potential clients in the process of planning their interior refurbishments. Whether you will be flooring, painting, sprucing up the bathroom, replacing cabinets, or upgrading the lighting – do so on a program that suits the consumer. It is a time to give special attention and to connect better with your client base.
The winter lull means more time to hammer out the details of your after sales service as well. Reconnect with existing clients before your competitors sweep them up, and make outstanding bonds with new prospects. This may lead to one or two referrals and more business down the road.
Lean into the bargain basement
Should you consider decreasing your prices in the winter simply because of the decrease in demand? You don’t need to feel pressured by the buyers’ market, but including seasonal incentives in your plans to gain that competitive edge might be a good idea.
Potential customers are going to petition for good deals. The prices went down last winter and it’s going to do the same this year around. As a contractor, you have the option to offer winter discounts to win more bids.
The last thing you want is to work at a price-cut only to find out that you’re taking a licking at your own expense. To prevent this from happening, assess the damage and come up with a good deal.
Spark a sense of urgency – Let your clients know this is seasonal discount, and they should take advantage while they can.
Put a premium on adding value
Your clients may not see the potential opportunities to add value while remodeling, so tell them. Things like replacing old windows and doors are worth a look to bring in a better financial investment to the client, especially if they are getting ready to sell.
These minor modifications can add tremendous value to a client’s home. A new front door can add up to 97% of the amount spent to the value of any home. Let your clients know that these minor services are seasonal and that they should take advantage of them while they can.
…And while you’re at it, conduct a whole house inspection
British Gas have recently revealed that 49% of homeowners are not looking forward to the winter season, many worry about whether or not their homes will bear up against the bitter temperatures, heavy rainfalls, intense winds, and forecasted snowfalls.
It is important for contractors to make sure that their sites are fit for winter and for the long haul after. Making sure not only that the property is going to brave the elements but also that their valued clients are comfortable and secure is a huge value prop.
A home performance inspection will lead you through the entire home conducting a much needed survey to make sure everything is in order. You might want to keep an eye on the insulation, test heating systems, undertake external building inspections, etc. depending on the service technicians and expertise within your capacity.
Taking these simple checkups into consideration, all contractors can have a happy and stress-free winter, knowing that they have protected the property of, and created a comfortable home for, their clients during the off-season.
Existing clients: At the start of the winter season, get a head-start by connecting with your existing clients. More often than not, this is where your biggest market lies. You already have an established reputation with the people that have used your business in the past. They typically know you, identify with you, and have confidence in you. If your client asked you to remodel their kitchen in the summer, maybe they need someone to update their lighting in the winter.
Networking and referrals: Winning referrals from networking or past business involvements isn’t just a cost-free way to gain new business. It’s also a way to gain customers with the highest retention rates. Referral customers tend to make use of your services more and more over time and in return become a source of even more referrals. In the end, Your Referrals will find you – if you have a service that’s coveted.
Then, feel free to ask satisfied customers for referrals. Be sure to also find ways to show your gratitude for their ongoing support of your business.
Strategic alliances: You may want to take your familiarity with other entrepreneurs a step ahead and pile up “strategic alliances.” These alliances can often last for many years to come. For instance, an excavator and a landscape contractor may send each other referrals or clients who need additional services.
These Strategic alliances can produce spills of referral business for you, which is ultimately what will you will benefit from most in the off season and over time.
This time of year! As we wind down the end of a year that lies behind, one just can’t help but think that the next year’s missions and gambles will come down on us before we know it. That means getting the W2s out, doing 1099s, trying to deal with “the books” to get the accountant in, etc. Many businesses won’t plan to set up their budget until next year. Why wait until January?
Work on your accounting
During This Time, Many contractor business owners will use their accountant as someone who rallies around with tax planning –deductions to be locked in by year end and moves need to be made to get in the running for some tax credits. Sure, accountants are useful in many more ways than that.
But restricting the use of your accountant to taxes alone is just like taking a morsel of salad at an all-you-can-eat buffet. Point is: You’re not getting everything you can get out of a good resource, especially if you have unmet business goals behind you – or questions about current and future business challenges.
Your Accountant is probably the most played-down resource right now. At other times Business owners can be so busy making ends meet that there is no time to take a seat and explore financial data.
The Unwinding of the Off-Season is an excellent time to tap into the knowledge and business know-how that your accountant has in his woodshed.
Below are 10 ways (tax-planning-free) that you can use at upcoming meetings with your accountant(s) to end your next term on a stronger operational note and to launch a thriving new stretch of business ahead:
1. Review the results of the passed year –to date- and compare with the year-ago period to develop an action plan for the time to come.
2. Learn more about key financial metrics and key performance indicators (KPIs) for your industry, and organize a way to begin following those signals for making better business decisions.
3. Benchmark your recent results against industry peers.
4. Begin Scheduling three-monthly meetings for the coming year to discuss financial issues with the goals of improving profitability and cash flow.
5. Make sure your business is worth as much as you think it is. Accountants can help you make out what to do now to make what you want to happen – happen!
6. Determine your strengths, weaknesses, opportunities, and threats (SWOT analysis) of your business and it’s future projects and use all of that that to develop your future plans.
7. Find out if you have enough resources to grow your business.
8. Discuss your banking relationships and whether there are any debt covenants or other issues that you’re worried about fulfilling, or whether you need help applying for a bank loan.
9. Are you getting the return on investment you thought you would from recently hired employees or recently purchased equipment?
10. Analyze whether planned upgrades, hires, purchases, or business changes may show good returns.
Are you a contractor or entrepreneur in the construction field? Have any more ideas about how construction contractors stay busy in winter? Help our community of contractors to gain extra income during the winter? We want to hear from you – share your expertise, ideas & opinions in the comments below!