When your electrical business has lots of clients and lots of cash coming in, you would think that you would be seeing handsome profits as well. That is not always the case. Inefficiencies in your business, hidden costs, and poor control of cash flow can shrink your profits. But, there are ways to control electrical business costs so that you see routine and growing profits. The keys to doing this are tracking expenses more effectively. If you cannot do this with the bookkeeping setup you have now, consider outsourcing your bookkeeping to the top accounting firm in the Kansas City area, Exigo Business Solutions. Using business intelligence tools and fresh approaches to business management, we can show you how to control cash flow, cut costs, run an efficient business, and start growing your bottom line from day one.
Once upon a time, running an electrical business was easy. Clients hired you and you did professional work. They liked your work and hired you again and again. With fair rates and a customer base built by word of mouth, your excellent work was rewarded by loyalty from your satisfied customers. But, the business world and the world of electrical contracting have changed. The cost of your supplies has increased along with rent, fuel, and employee expenses like health insurance. On top of that, hidden costs sneak into your business operations and suck out cash flow before it reaches the bottom line. You lose track of where all the money is going. Every job seems to take longer and cost more than it should. To get a handle on this situation, you need effective tracking of expenses, hours spent on jobs, and other “hidden costs.”
When there is an electrical problem you know how to check it out from the most basic issue on up in order to fix it and make sure it remains fixed. Unfortunately, on the office side of your operation little problems keep popping up. You think you have fixed them. And, they come back in a slightly different form. This is because you are not getting down to the basics. When one of our clients has this dilemma we suggest a management approach called Fix This Next.
The basis of this approach to fixing business issues is its focus on the business hierarchy of needs. This starts with sales and profit and then moves up the line to business order and efficiency. The problem when you are continually fixing little issues in your electrical business is that you are fixing the wrong things! Problems start at the base of your business and move up the ladder. With a Fix This coach at your side you will find the basic problems in your electrical business and fix them. Then you will put in place systems to track those problems to make sure they don’t come back. This is your first step to controlling electrical business costs.
The way that most businesses look at profit is that it is both the result of hard work and planning and an uncertainty. The Profit First system looks at profit as a right and a certainty. It helps you control electrical business costs by allocating money for profit every two weeks, banking the money in a designated account, and then addressing cash flow and budgeting so that you start containing costs. Working hand in hand with the Fix This Next system you can get a handle on costs and start routinely banking your profits.
The next step in the Fix This Next system is to make sure that things that you fix stay fixed. And, you want to do this efficiently. When sales and profit issues have been addressed, it is time to deal with the organization and efficiency of your business. We will help you set up simple to use and powerful business tracking systems that will let you make sure that problems that you have fixed stay that way.
The sorts of issues we will help you address include bidding jobs for the right price, assigning workers to the tasks at which they are the most skilled and profitable, and tracking lost time due to inefficient scheduling.
A big part of making a profit in your plumbing business has to do with taking a profit. This is where the Profit First system of budgeting, cash flow management, and tracking expenses is useful. A common issue in any business is that the owner views profit as a possibility or variable instead of making it a habit. This way of doing business starts with how you view your bookkeeping.
Many times a business owner knows that costs are too high and they take an ax to their budget. The problem is that too often they cut the wrong things! To do the job right, work with the experts at Exigo Business Solutions in the Kansas City area. For help controlling costs in your electrical business, increasing business efficiency, and seeing routine profits, contact us at Exigo Business Solutions.