Seth Godin recently had a short but deep blog post that I wanted to share:
'Small dreams work this way: figure out what's available, then choose your favorite. Important dreams are based on what needs to be done, and then... find your how.' The concept is similar to what other authors present as 'lateral thinking' or 'beginning with the end in mind'...
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Summertime is here and we're taking a break from the blog. There may be the occasional post throughout the summer, so check back once in a while if you like. Otherwise, there will be no weekly email reminder, no weekly blog post until September. Its important to re-charge the batteries and I hope to come back in the Fall and deliver more value.
In the meantime I wish you a beautiful and relaxing summer! I leave you with one of my favourites quotes/concepts. It has been said that... The 3 things most likely to have a positive influence in your life are: - the people you meet - the places you go - the books you read I've certainly found that to be true in my life. I hope this summer will feature some positive influences in your life. Here are a few recommendations for work/life issues that might be interesting... photo credit: Steffens-Colmer Studio; Vancouver Archives
Painting is a good way to make an honest living, especially so if you have your own business. You learn all sorts of real world skills that help you create value for your clients and your family. When it's hot, you work indoors or in the shade. When it's cold, you work inside. There is plenty of work available and there is no danger of the trade becoming obsolete anytime soon. The barrier to entry is quote low, as you don't need a lot of tools and equipment, nor do you need much schooling and ticketing. And the sky is the limit if you want to grow your business. The main problem with painting is that it can consume your two greatest assets. Assets that are far more valuable than mere dollars. If you let it, painting will soak up most of your time and the best of your health. It may come for your family too. Once these critical assets to your well being are gone, they are irreplaceable. The moment you stop applying liquified colour with a fuzzy-tipped stick, that's the moment you stop making a nickel... There has been much written lately about risk. Specifically about how we as humans tend to be inaccurate in assessing risk. We generally over estimate the potential risks in any given outcome, using it to rationalize inaction. Our default seems to be the status quo, safe, inertia. It's easier to avoid critiquing our estimation of risk, avoid planning for worst case scenarios, and avoid acting bravely, boldly.
But we can over-ride the fear of risk by using logic... After considering the benefits of specializing last week, let us consider an alternative strategy.
There are valid reasons and benefits to diversify your micro business: 1. For survival. When just starting out you may not have enough demand for your specialty offerings yet. It can cost a lot of resources and energy to create that demand. Offering more services takes the pressure off and allows you to find your legs. It might allow your business to grow quicker because you are saying 'YES', rather than no. An example of this would be taking on cleaning contracts during the evening and weekends in order to keep your days free to promote your core services. Having a variety of income streams also provides a little insurance for seasonal fluctuations in business or changes in the economy. You are able to switch gears quickly. An example of this would be offering a snow removal service in the winter when painting traditionally slows down. In a booming economy new construction painting is in high demand, but in a down economy there may be more opportunity in custom homes, residential re-paints, renovation painting, commercial painting, or insurance work. Developing a full quiver of painting skills allows you to adapt to market opportunities. 2. To learn new skills... Last week we looked at some advantages of either specializing or diversifying your business.
This week I'd like to relate a few anecdotal examples of specialists I've observed over the years to see if there is something in their experiences that could benefit you in your business. 'You can do many things averagely well, or you can do a few things superbly well' -Greg McKeown, author of Essentialism - The Disciplined Pursuit of Less Perhaps my favourite is Grant's Ladders in Penticton, BC. Grant used to run Grant's Painting - a new construction painting business with happy contractor clients. But for various reasons (that I suspect had to do with lifestyle, health and family considerations) he opened a small shop specializing in top quality ladders, scaffolding, and all related parts and equipment. In the south Okanagan you can get a ladder at a hardware store, or you can go to Grant's. They serve different markets. Grant's never has a sale. But he offers great products and knowledge. With possibly the worst retail hours ever, he is only open from 8:00 - 9:30 am M-F, but his cell number is on the door if you need a ladder in an emergency situation. Otherwise he has plenty of time to have coffee with friends, play with the grand kids and relax on his pontoon boat in the summer. I think the reason why Grant specialized is to free up his time. Another of my favourite examples is JHM Drywall Repairs, also in Penticton. It's all in the last word in his business name - repairs. John is a capable drywaller and can board and tape with the best of them. He can frame, insulate, vapour barrier and paint as well. But he markets himself as a drywall repair specialist and often subs out everything else. This means easier work physically, quicker turnover for his cash flow, less competition, positioning himself as an expert problem solver. It also means his competition, other drywallers, don't mind sending work his way. Most are busy with larger projects and they can safely pass along small jobs that would be a nuisance to them. And he can refer larger jobs back. Choosing to specialize allows Jon to hit the gym and walk the dogs before work, get a decent day's work done and still be home at a reasonable hour. I think the reason why Jon specialized is to distinguish his business in the market and allow him to work on his terms. One more of my favourite examples is... It's a debate that I've thought about a lot over the years. The smaller your geographic market is, the more pressure to be a generalist. The larger your geographic market is, the more opportunity and incentive to specialize. But which business model is better? Or more importantly, which one is right for you?
Let's consider some benefits for each model... At dinner one night a few months ago we had the privilege of sitting with the proprietors of a very well established restaurant. It is a warm and welcoming place with a very loyal clientele. It was built from the ground up by the patriarch of the family. His son told me that at the beginning, his father would work at his construction business from 7:00 to 3:00. Then he would come to the restaurant in the late afternoon and nap on a bench, asking the hostess to wake him if any patrons arrived for dinner. He would be at the restaurant late late into evening. Now they are busy 12 months of the year while many competitors close down during the off season. One of the keys to the success of the restaurant has been Father's long term view of all business matters. They always gave their best to their customers, treating them like family and never serving anything that wasn't the best quality. They have never advertised, choosing instead to focus on treating every customer like gold.
This conversation got me thinking about my own painting business and the idea of laying bricks... Who gets to decide whether a worker will act as an employee or as a sub-contractor? It should be a key concern to independent contractors.
Some workers prefer the stability of a steady pay cheque and the ease of having taxes, EI and CPP deducted and remitted on their behalf at source. Other workers prefer the flexibility and tax write-off potential of sub-contracting. My preference was strongly towards having subs.It offered me motivated workers, flexibility in scheduling, simpler books and less pressure. It kept labour as a cost of sales, not overhead. So who should decide....workers or employers? Turns out, neither... Sometimes it felt like my days were spent slaying dragons, putting out fires and squeezing in enough value-generation (painting) to be able to keep the wheels turning for another day. Rinse and repeat.
Most of the clients I worked for were more financially successful than me. Once in a while there was a customer that seemed to have things figured out pretty good - they seemed successful at life. If I had a good rapport with them, I would ask them for one piece of advice that they thought was a key factor to their success over the years. I thought of it as mining for nuggets. Why insist on doing things the hard way if there was an easier option? Some of the answers I received didn't resonate - they didn't jive with my personal values. Some advice was straight forward, practical (i.e. work hard). In ten years of asking, the most interesting, beneficial and actionable answer came from my best customer. I don't think it was a coincidence. Jim, I thought, would be a good person to ask. He owned and operated a high-end custom home design/build company. At the time he simultaneously owned and operated a high end restaurant in the heart of wine country. Those two business sectors alone were notoriously challenging for entrepreneurs to survive in, let alone thrive. Besides that, Jim is an accomplished musician. He and his wife help their 4 children reach their potential through schooling and entrepreneurship. Jim is very busy. But he finds time for family, exercise, hobbies, holidays, and for everybody that he comes in contact with. And he never seems stressed. What was one key to his success?... WHY: PROFITING FROM THE RIGHT APPROACH
This week I met a new colleague, a fellow painter and business owner. He mentioned that he has been busy working 7 days/week in order to catch up on work prior to an upcoming family vacation. He is midstream on a small housing development of 10 homes that is progressing quickly. His phone is ringing with more work from the install department of a big box retailer. He was in the paint store at dinner time waiting for colour matches for the next day so he could keep his crew of seven guys running steady and keep the client's project moving forward. Then he said it... 'I've got 3 estimates waiting for me when I get home.' Boy do I know that feeling. There goes the rest of his evening. A whole day dedicated to his painting business. A whole week. A whole month... I've had a love, hate, love relationship with estimates... If you operate your micro contracting business as a sole-proprietor or a partner in a partnership, one challenge you might face is remitting your personal income taxes in a timely manner.
One of the most effective business strategies was gifted to me about five years ago by a close friend who operated several micro businesses. It is an extremely simple solution, but very powerful. Michael Gerber, author of The E-Myth says: 'the system is the solution'. This system might work as well for you as it has for me... WHY: FEEL GOOD ABOUT WHAT YOU CHARGE
Earlier this month Seth Godin wrote a brief blog post sharing a simple formula for calculating hourly rates for independent contractors. 'Successful freelancers need to charge at least double the hourly rate that they'd be happy earning doing full time work. (In many fields, it's more like 4 or 5x).' If the average proficient painter can make $20/hour ($40,000/yr) working as an employee, let's see what he should charge for contract work using this principle: $20 x 2.5 = $50/hour That should be your baseline figure. If you or your clients feel that is high - how can you reconcile the cost and feel confident about your ask? One thing you can do is do the math... So a few years ago I took my daughter to see a particular show that was on tour. One of the take-aways for her was the chorus to one of the songs. She would sing that line for months afterward. I think she may have actually learned something pretty important that day.
Around that time I learned the same lesson, but I came to it from a different route. The summer lake house had about 4 feet of water in it... What is the point of paying a graphic designer to create attractive branding and marketing materials...
What is the point of buying and distributing business cards... What is the point of paying for a web designer, hosting fees, SEO optimization, website registration, and a high speed internet connection... What is the point of purchasing store front signage or decals for your vehicle... What is the point of paying for advertising and a phonebook listing... What is the point of paying for a costly cell phone plan...
Today is moving day.
10 years after starting my painting business it was time to sell it and move on to another opportunity. Change is complicated, both emotionally and logistically. And it got me thinking about how things like moving away or starting a new business require you to be 'all in', because everything is about to change. There is a sink or swim urgency that awakens your senses and forces you to rise to the challenge. Feels like the opposite of being in a rut. But it requires a lot of dedication and hard work. Lots of hard work. It's almost always easier to avoid change and see it is a threat. What does this have to do with you?... The memory is vague but along the way somewhere I recall my father telling me something that my grandfather Wolfgang had said about work. My grandfather was a very intelligent man with a lot of life experience. It's not an exact quote, but the gist of it was:
'Work is a gift from God. To work is a basic human right and a human need. There is never a shortage of work to be done.' For some reason those principles registered with me. It makes sense. Sure, sometimes there is a shortage of paying jobs, but there is always work that needs doing regardless of the time of year or the economic climate. This concept is liberating because it frees me to go out and create value, do something. A person needs not wait for an invitation, an opportunity, a phone call, etc. You can just simply get to work. If you run your own painting business, there is little point waiting around for the phone to ring. You have the right to work, you don't have to wait for someone else to give you the opportunity. You can create your own. This coincides with what I've noticed over the years. Its way easier to find work when you are busy working. So if its slow, try to find a way to keep busy. Find a way to add value to other people. Here are just a few ideas... 'Action is the foundational key to success.'
- Pablo Picasso 'In the end the question can only be answered by action.' - Stephen Pressfield, The War of Art That quote by Picasso has been my guiding business principle for over a decade. It seems overly simple at first glance. It's true that it doesn't contain all the elements of success - action doesn't guarantee success. But inaction guarantees failure. Knowledge only benefits us when we put it into action... As an entrepreneur, you will enter into negotiations on a regular basis with suppliers, employees, prospects or clients.
There are times people just need you to go the extra mile in order to keep a project moving forward toward the goal. It's OK to trust your gut and make someone happy, making an investment in goodwill. Other times, people may be out to squeeze the profit out of you, or pressure you to meet unreasonable expectations. Their demands are a way of gaining control of the transaction and taking your power away. This is a critical stage in a business relationship. Will you blink first? There is a lot of information available out there on negotiating. But one simple, easy to remember principle that I picked up along the way has served me well over the years... WHY: DOING IT IS DIFFICULT BUT PROBABLY NECESSARY
Do you frequently find yourself tight on cash-flow? Are you too busy - is your customer service dropping? Are you attracting the wrong customers, ones that are unreasonable? Tired of offering a particular service that you don't enjoy or that offers little profit? Not enough time to pursue the things that are really important to you and your family? The answer to all these problems (and more) might be as simple as raising your prices. It's easy to say, but hard (and scary) to do. On another blog post we will deal with why you should raise your prices. But for now, lets assume you've realized that a price increase is needed. How can you implement your decision? *something to consider before you think about raising prices: Am I as busy as I want to be? If not, raising prices may not be your first priority. Although, low prices may be driving good potential clients away...
WHY: 'IF YOU HAVE A SKILL, YOU HAVE A JOB'
In a recent interview with MEDIA PLANET (see link below), Mike Holmes shared a few nuggets for young people considering the trades as a career option... "It's a great career. If you love it, you will go far. There's good pay, and when you're really good, there's no telling how far you can go. The demand for tradespeople is huge, and it's growing every year. So chances are, if you have a skill, you'll have a job - and a good one. Being in the trades is an advantage. Having a skill is an advantage. It's an investment you can't lose.' He emphasizes the importance of FOCUS in learning and mastering a skilled trade...
WHY: WORK SMARTER, NOT HARDER
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