It happens every year – stop being surprised and take charge
One of the things I love about my profession and about the company I work for, Nexstar Network, is they both present me with significant opportunities to learn and grow as a business coach and a person. And yes, they are very often related. One such lesson I learned in 2016 was when I complain about something, especially in a repeated manner, I’m actually not taking responsibility for changing that condition, whatever it is. What’s more, I’m actually playing the victim—which I cringe at thinking about—to someone, to a condition in my job, or to some other circumstance in life.
In my role as a business coach, I too often hear this type of complaining about seasonality, and specifically the slow times caused by seasonality. (I don’t hear much complaining about the busy summer season!) These slow times, are largely due to the weather, but also holidays and events such as the kids going back to school. What adds to the frustration around these times is that, for the most part, there are no marketing magic bullets; in other words, incremental marketing dollars spent during these times have little or no return.
Companies complain about seasonality as if it is a surprise and as if they’re powerless to do anything about its’ effects. I would like to set the record straight that neither of these two perceptions is in fact reality. First, regardless of where you live, your market has seasons that occur every year. Some of them may be more extreme than in other years, or occur at slightly different times in some years, but you basically know how the seasons work. As such, you can foresee the slow seasons coming. Always. There is always going to be slower period from March to mid-May for HVAC. There is always going to be a slowdown around back-to-school time. Your customers are always going to be distracted the last 10 days of December. A lot of people are going to go on vacation the week of July 4th. Knowing these things, you can act in advance to proactively plan what actions you will take in those slower times. This will empower you, freeing you from the powerless or victim mentality.
What the best companies do is mitigate these slower times. You can’t eliminate them, but you can lessen their negative effects on your business. Again, knowing and accepting that these times are just part of the “rules” of the contracting business “game” that you are playing, you can plan how your company is going to act. What I’ve found is that the best companies concentrate on what they can do internally to make good things happen. And when you do plumbing in addition to HVAC, that means making more happen on the plumbing side to help make up for the drop-off in HVAC.
You can do two things to help mitigate the slow times:
1) Improve the effectiveness and the productivity of your call center.
2) Improve the effectiveness of your field producers (technicians, salespeople).
Here are some things to consider for solution #1 — Manage your three-to-five day call board proactively. Make sure that you are outbound calling to fill in holes. First, call your maintenance agreement customers. That’s a pretty easy one, right? You would think that, and yet I see contractors drop the ball here on their intentionality around the timing and the extent of these calls.
Second, go through old invoices to identify opportunities from previously quoted work that was not purchased at the time. (At Nexstar, our members give at least four options on every job, so there are often products or services the customer wants/wanted that were not purchased at the time of original call for one reason or another.) Tell these customers that you are having a sale— winter sale, spring sale, back to school sales, whatever. Offer a discount on this previously quoted work. And remember, you will need provide some type of extra spiff to your outbound callers (i.e. a flat $ fee or even a % of the ticket) if you want great results.
In addition, work with your dispatcher to maximize. He or she is key to this:
1) Be sure that the best techs and best sales people (producers) get the calls/leads (“play favorites” and “hot hand”). There is no democracy or “next up” when things are slow.
2) Focus your dispatcher(s) on setting up the call for the tech (reminding them to look for big ticket opportunities).
3) Review your “hot calls” (your best opportunity calls) and make sure everyone is on the same page and focus on them.
4) Consider having all techs call the service manager before they leave a house where they are having trouble closing a call.
Here are some things to consider for solution #2 — An effective operational tactic for slower times is to focus on high revenue items like tankless or conventional water heaters, re-pipes, sewer jobs, water filtration, generating an HVAC lead that sells, selling an HVAC lead, or high-dollar IAQ items. These are difference makers in your business and also generate a lot of helpful cash flow. So, your list of these types of items will be more like three to five, (for each trade), not 15- or 20. Too many things will dilute your people’s focus.
One of the best ways to increase the focus on these items is to offer some extra financial incentive—offer a little extra juice aimed at getting your guys to produce more from less (fewer calls). You may not be able to generate any additional calls, so then it becomes imperative that you maximize all the calls you do have. Providing some extra financial incentive helps this. One simple way to provide extra financial incentive is to temporarily increase existing spiffs. An example might to be increase the existing spiff of 2% on a tankless water heater to 3% or 4%. Do this for a limited time: a day, a week, maybe a month.
Another way (and possibly more fun and more culture-building) is to hold some extra contests. Keep contests to no longer than a month in duration (people lose focus quickly). Also, don’t have a contest where one or the best person wins, because your middle producers often concede early on to the best producer and thus don’t engage in the contest for very long. (Your contest then just becomes a reward for your super tech instead of engaging all your techs.) Instead, have a contest where people can earn “chances” from which three winners will be drawn (i.e. “out of a hat”). So you have large, medium, and small prizes (from three drawings). They can earn these chances to win through certain highly productive activities (see the list mentioned above). You can also give different weights to different activities. For example, a tankless water heater might earn them three chances, while a conventional water heater earns one.
You can also hold a daily “standup” meeting to get your guys focused and motivated. This is literally just a five- to eight-minute meeting to get everybody pumped up and focused. You might even introduce the “spiff of the day” like “first guy to sell a tankless water heater gets a $50 gift card from Cabela’s.”
In addition to contests, step up your training and motivation of the techs. Perhaps have an extra training session each week. As they say, “It’s when times are slow that you learn what you don’t know.” Train your people so that when the busy season opportunities do eventually come, they will be totally ready to maximize!
A word of caution regarding one practice contractors have sometimes used in the past: laying people off in the slow times. Think twice before doing this. This is not a practice I’ve observed successful companies doing, at least not these days. In the context of the reduced labor pool that our industry faces, laying people off is becoming a much less practical option. You could end up losing good people.
So as you enter 2017, I encourage to discover the power that you do indeed have over the seemingly powerless of seasonality. You don’t have to be resigned to things just being a certain way because “that’s the way it is.” Through your identification in advance of these slower times, you can make positive things happen for you and your people even in the slower times.