Like many contractors, Joe Chiera’s early days were spent comfortably mowing a handful of properties. He thought about expanding and growing, but wasn’t sure how—or if it would be worth the risk. He had to make his mind up in a hurry when a general contractor suddenly asked for his help on a pretty sizable project.
“We had done some smaller install projects for him in the past, and he was always pleased with our work,” Chiera recalls. “This particular job was a much larger commercial job.”
Chiera says the most important thing with jobs over $50,000 is to present your company at the highest level of professionalism:
• Always have an impressive portfolio with you
• Always have a list of references with you
• Always get to know the customer and make him or her feel like part of your family
There are also several keys to successfully completing the job and making your margin:
• You need great supervisors who you develop a plan with ahead of time – you need to talk through each phase of the project and develop realistic timelines
• Try to stick as close to the contract as possible, and anything extra should be viewed as a change order and discussed with the customer; many customers are notorious for adding and changing things on the spot, so you have to be right on top of it and get them new contracts and quotes before completing the work
As Chiera was branching from lawn maintenance into other services, he admits that much of his learning happened on the job. Being upfront and honest with customers was always at the top of his mind.
“We would always let them know we were just developing this particular area of our company, but reassured them that we would not let them down or quit until the job was right,” Chiera tells. “We also let them know they were getting a slight discount for being the ‘test run’ with that particular project. After we developed a portfolio and a couple good references, selling got much easier. Sometimes the best test runs are done on your own property, or a good friend’s or relative’s. We also did plenty of that.”
BREAK IT DOWN
Shortly after Chiera and Posten started “accepting work and figuring out how to complete it,” the duo determined it was also a good time to develop a growth plan for the company. “We wanted to be one of the premier landscape and irrigation contractors in the tough northeast Ohio market,” Chiera tells. “But not a single one of us had any idea how a million-dollar company should operate and survive.”
They brought in consultant Rod Bailey for a two-day round of consultations. “Rod explained the importance of writing your goals down,” Chiera recalls. “He also taught us the importance of focusing on each job’s profitability and accounting for all expenses—especially when you’re doing installation projects, which we wanted to start doing more of. In maintenance, it’s critical to quote your true costs, which include labor and all sorts of hidden expenses like equipment repairs. You really have to think about it and not sell yourself short.”
Following Bailey’s visit, Chiera sat down with who today are key managers to set forth a five-year growth strategy. The company went from three employees to 35 in the next three years—15 of whom were year-round. Even more astonishingly, the company actually hit its five-year sales target in a single year. “We did it by maintaining focus on our goals and involving everyone on our team,” Chiera points out. “We also modeled ourselves after other large companies in the area—really analyzing what they’ve done to get to their size and maintain it.”
TAKING CONTROL OF A GROWING COMPANY
Lesson No. 1: You have to make money while you’re growing. Chiera and Posten learned, from both Rod Bailey and other contractors, that there are different ways to approach this.
“When you’re slow, maybe during an off-season or when the market is soft, make sure you’re always bringing in enough business to cover your fixed costs,” Chiera says. “You might have to make some concessions and do some things you normally wouldn’t want to do in order for that to happen.” “But you don’t always have to come all the way down to the customer’s bottom-end price,” Posten adds. “You can often come pretty close, and then use your references and reputation to clinch it.”