australianinvestor
Bronze Contributor
Wow, so many do's and don'ts
I'll try to give you some very general ones from my own experience:
- Know your exit plan. Why are you building this business? Is it to build up for a year or two and then sell? Automate it, and hold it for cash flow? Know how it fits into your ultimate plan, or you'll be cleaning pools and managing staff for the next indefinite period of your life, with no idea when it's going to end.
- Don't get caught up in planning and analysing instead of doing. Planning has its place, but do it, FINISH it and get going with the stuff that really needs to be done.
- Learn how to keep financial records - organised and correct. Saves money and headaches, and helps you make better decisions
- Learn how to budget
- Learn how to read and UNDERSTAND financial statements - critical for making good management decisions
- Keep the plan simple - complications increase expense, and increase the likelihood of failure
- Get an accountant, bookkeeper, and lawyer. Take their advice, and make your own decisions. Fire them and get better ones if they don't work out.
- Make your mistakes small. Don't bet the farm on something which isn't certain
- Limit risk. Structure things so the worst case scenario is still an acceptable outcome, if possible.
- Get insurances. Public liability, insurance for your staff, income protection insurance, loan repayment insurance etc.
- Understand that marketing is not just advertising.
- DO MARKETING. DO MARKETING. DO MARKETING. DO MARKETING.
- There are cheap and free ways to advertise, but ensure you don't look cheap
- Advertising is not an expense, it is an investment in future income
- Really understand the competition, inside out, and keep an eye on them.
- Develop multiple services and products you can offer. The right mix of products and services can do wonders (no understatement, just short on time to elaborate).
- Use discriminatory pricing - charge more in more affluent suburbs than in others (ensure service warrants the extra price) if appropriate, or charge less for multiple purchases (eg: 25% off the second, 50% off the third. etc)
- Don't engage in price wars, and don't compete on price. Don't price yourself low (in most cases). Justify your higher price.
- If you are predominantly a service firm, find some products to sell as an add-on to the service and another revenue stream
and one that I cannot overstate the importance of:
- Find a sustainable competitive advantage. I wrote a post on that somewhere here. Check it out (click my name and search my old posts).
and some miscellaneous ideas:
I don't know the name of the office in your part of the world, but if your government requires development applications or permits for pools, awesome! Go buy a BIG map (6 feet by 3 feet or so) of the entire area you intend to service from the government department which is reponsible for property surveys (it shows property boundaries and streets, we call it a Cadastral map, I think), and ask the place that issues the permits for a list of all properties in the same area with pools. Also ask once a quarter for new pool permit application addresses. Build a database of potential customers.
If this doesn't work, perhaps use Google Earth and painstakingly find pools in your area.
Maybe offer different packages for different people: the "lifestyle" package for the pool owner who spends a lot of time in and around the pool, etc.
Find all the spa dealers, and give them a free service coupon to give away with each spa they sell as a freebie, to be used in the first month from the sale date (make it a "post-installation service"). Go to the customer, make sure everything is working right, and sign them up for a service program each quarter/6 mths etc.
Get the spa sales people to add on a service agreement for one year for $x (small commission to them, and the amount is probably financed by the purchaser so is not an immediate cash expense), after all, the customer wants their big investment to be protected and work well so they can enjoy it, right?
Maybe find a place which makes small metal buckets, have your business name and number embossed onto them and use them as champagne bucket promo gifts.
I hope this is useful - I'm running late for a date with my pillow (she's hot - curves in just the right places, very soft, and smells wonderful, like fabric softener!).
Nighty night!
Daniel.
I'll try to give you some very general ones from my own experience:
- Know your exit plan. Why are you building this business? Is it to build up for a year or two and then sell? Automate it, and hold it for cash flow? Know how it fits into your ultimate plan, or you'll be cleaning pools and managing staff for the next indefinite period of your life, with no idea when it's going to end.
- Don't get caught up in planning and analysing instead of doing. Planning has its place, but do it, FINISH it and get going with the stuff that really needs to be done.
- Learn how to keep financial records - organised and correct. Saves money and headaches, and helps you make better decisions
- Learn how to budget
- Learn how to read and UNDERSTAND financial statements - critical for making good management decisions
- Keep the plan simple - complications increase expense, and increase the likelihood of failure
- Get an accountant, bookkeeper, and lawyer. Take their advice, and make your own decisions. Fire them and get better ones if they don't work out.
- Make your mistakes small. Don't bet the farm on something which isn't certain
- Limit risk. Structure things so the worst case scenario is still an acceptable outcome, if possible.
- Get insurances. Public liability, insurance for your staff, income protection insurance, loan repayment insurance etc.
- Understand that marketing is not just advertising.
- DO MARKETING. DO MARKETING. DO MARKETING. DO MARKETING.
- There are cheap and free ways to advertise, but ensure you don't look cheap
- Advertising is not an expense, it is an investment in future income
- Really understand the competition, inside out, and keep an eye on them.
- Develop multiple services and products you can offer. The right mix of products and services can do wonders (no understatement, just short on time to elaborate).
- Use discriminatory pricing - charge more in more affluent suburbs than in others (ensure service warrants the extra price) if appropriate, or charge less for multiple purchases (eg: 25% off the second, 50% off the third. etc)
- Don't engage in price wars, and don't compete on price. Don't price yourself low (in most cases). Justify your higher price.
- If you are predominantly a service firm, find some products to sell as an add-on to the service and another revenue stream
and one that I cannot overstate the importance of:
- Find a sustainable competitive advantage. I wrote a post on that somewhere here. Check it out (click my name and search my old posts).
and some miscellaneous ideas:
I don't know the name of the office in your part of the world, but if your government requires development applications or permits for pools, awesome! Go buy a BIG map (6 feet by 3 feet or so) of the entire area you intend to service from the government department which is reponsible for property surveys (it shows property boundaries and streets, we call it a Cadastral map, I think), and ask the place that issues the permits for a list of all properties in the same area with pools. Also ask once a quarter for new pool permit application addresses. Build a database of potential customers.
If this doesn't work, perhaps use Google Earth and painstakingly find pools in your area.
Maybe offer different packages for different people: the "lifestyle" package for the pool owner who spends a lot of time in and around the pool, etc.
Find all the spa dealers, and give them a free service coupon to give away with each spa they sell as a freebie, to be used in the first month from the sale date (make it a "post-installation service"). Go to the customer, make sure everything is working right, and sign them up for a service program each quarter/6 mths etc.
Get the spa sales people to add on a service agreement for one year for $x (small commission to them, and the amount is probably financed by the purchaser so is not an immediate cash expense), after all, the customer wants their big investment to be protected and work well so they can enjoy it, right?
Maybe find a place which makes small metal buckets, have your business name and number embossed onto them and use them as champagne bucket promo gifts.
I hope this is useful - I'm running late for a date with my pillow (she's hot - curves in just the right places, very soft, and smells wonderful, like fabric softener!).
Nighty night!
Daniel.