Managing construction and trade businesses are currently thriving– it’s safe to say that a career in the trades will never go out of style. As the world progresses, the need for tradespeople increases. This means that the electrical business is a lucrative one where both electrical workers and business owners can make some good money. In 2019, there were more than 72,000 employees with an electrical occupation in California alone, according to the Bureau of Labor Statistics.
Be that as it may, running a business is not an easy venture. Employees, capital, clients, and electrical contacts are just some of the things you’ll have to juggle. With the electrical business so popular right now, you’ll need to work hard and smart to have yours grow and be successful. In this article, we give some tips to help you do just that.
Keeping Your Business Plan Up To Date
A business plan is one of the essential things to have when running a business. It outlines the company’s business goals, methods of achieving these goals, and the time-frame to attain these goals. Essentially, it’s the foundation to build your business.
If you don’t have one yet, it would be wise to start writing one up. If you’ve been in the industry for a while with a business plan, you should know that they can “expire.” The electrical industry is one that is always evolving. With new technologies and trends continually popping up (e.g., subcontractor scheduling software) and changing circumstances ( e.g., a new electrical contractor in town), you need to adapt to help your business grow.
Updating your business plan is one of the most effective ways you can keep up with the times. One way to do this is with a SWOT (strengths, weaknesses, opportunities, threats) analysis. Once you’ve identified these, you can start developing a new plan or tweaking your old one.
A good plan will aid the project lifecycle. In the same sense, a good business plan is one step toward a successful electrical venture. With that, it’s essential to have a clear, healthy, and effective plan.
The Importance Of A Skilled And Competent Team
Another necessity of a successful business is the qualified staff. Your electrical contracting business will only be as good as the people you have on board. Being a trade, the electrical field requires people who are skilled, trained, and capable. They are the support pillars holding your company up. You may be the boss, but your employees, particularly the electrical workers, play critical roles in your business.
One, they deal directly with the customers. People and communication skills are just as important as technical skills in the electrical business. They interact and work with your clients on a daily basis. This means that they must be trained to give the best experience, from attitude to actual work.
Two, they represent your company. Reputation means everything in the contracting business and your workers have a big hand in shaping it. When the customers are not satisfied with the work they have provided, word will spread and could potentially damage your image. Conversely, a job well done will put your company in a good light. This is why hiring is a critical process.
8 Tips On Running and Growing Your Electrical Business
1. Create and maintain a strong brand
Branding is one of the most critical factors in starting and growing a business. It’s what gives potential clients their first impressions, helping them decide if you’re the one for the job. It’s also what makes you stand out from the competition.
Being an electrical contractor, you’ll want to establish a strong brand to survive the cut-throat industry. You must know how to present your business to the public and what you want to present. This is the first step in creating and marketing your brand.
2. Strategically market your business.
Once you’ve identified your brand, it’s time to market. This is what will attract potential customers and further your reach. In fact, this is also one of the most vital components of any business.
There are many ways you can get your business out there. While posting listings in newspapers is still useful, it’s wise to invest more in digital marketing. Some strategies include:
a. Create a great website
A well-executed website is one effective way to attract potential clients. It’s convenient for them because they can access all necessary information on just one site, helping them decide on you.
But remember that layout and design are essential. According to Adobe, about 38% of viewers will stop engaging with a website if they think the design and layout are unappealing. So, it’s better to hire a professional developer.
b. Make a social media presence
Aside from a website, you can connect and pull quite a few customers from social media. As of 2019, there are about 247 million social media users in the US.
Social media marketing (SMM) is focused on achieving branding goals by creating and sharing content on social media channels. The top 5 platforms are Facebook, YouTube, Twitter, Instagram, and LinkedIn.
c. Consider Pay-Per-Click (PPC) advertising
Although it requires a great budget, PPC is great for driving instant targeted traffic to your electrical contracting website. Since it’s paid to advertise, you can buy traffic with online ads. This allows you to generate curative leads and generate more sales.
3. Foster relationships with employees, facilities managers, and vendors
Building contracts and relationships are vital in maintaining your electrical business. A good working relationship with your team builds rapport and motivates them to do their best.
Additionally, a good relationship with vendors gives you a steady set you can count on. The same goes for clients. Plus, loyal customers can refer you to other people, broadening your network.
4. Ask for feedback
Customer feedback helps in improving your business. Their constructive criticism can guide you in changing what needs to be changed and fix what needs to be fixed. Plus, their positive reviews can, as mentioned earlier, help shape your reputation. It also makes them feel heavily involved with the project and closely connected to the business.
Develop a consistent survey system and implement this after each project. Maintain this structure and discuss the feedback with your team so everyone can learn.
5. Benchmark your performance
Benchmarking will help you optimize your profitability by comparing your numbers to competitors’ and learning from them.
Do this even if the business is doing well. You might find that things could be better.
6. Maintain adequate working capital
A lot could go wrong in an electrical business, and running out of capital is one of the worst. Ironically, this situation can get pretty costly: you’re forced to maintain a balance on a credit account, miss discounts from suppliers, and keeps you from getting state-of-the-art technology.
To keep this from happening, make sure you are handling your finances properly, keeping track of expenses, and avoiding unnecessary purchases. It’s also helpful to leverage small business financing forms, like working capital loans, to keep your business afloat, especially when cash is running dry.
This is also why it’s vital to maximize your profitability. More money is always good in business. So, find ways to generate more leads, pull customers, and land jobs and projects.
7. Update your invoicing strategy
You may think that it’s as simple as writing a receipt, but a weak invoicing strategy will lose your payment opportunities.
One way to ensure payment is invoicing customers early. Rather than giving it to them at the end of the month, present their bills right after the project is done. This can provide ample time for both parties to work things out, especially when clients become difficult.
For larger projects, milestone payments are an acceptable choice. Instead of waiting months to collect revenue, you can get paid after significant stages.
Whatever your choice, make sure to discuss it with your clients before working. This is to avoid any issues and discrepancies.
8. Keep up with emerging trends and technologies.
We mentioned earlier that there are always new trends and technologies popping up in the electrical contracting industry. Unable to adapt to modern times will leave you significantly behind the competition, given that it’s fierce here.
Welcoming new technology is undoubtedly advantageous to your business. It’s not only about using it directly to benefit the customers but also to help your business grow. Most innovations now are focused on improving productivity and efficiency, from things as big as robotics to simpler ones, like project management software.
In some cases, these trends and technologies can introduce you to a whole new set of clients. For example, you can add more clients to your roster when you take the eco-friendly route and offer green buildings services.
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