To make more money in your HVAC business, or any business, you can take in more money or reduce your expenses in order to convert more sales into profits. Your cash inflow will increase with better marketing, more customers, and better-paying customers. Your expenses will decrease with better bookkeeping and accounting that leads to better cash flow management, budgeting, and financial discipline. These are the general principles that you need to apply to increase and maintain profits in your HVAC business. But, what steps do you take, and in what order, to get your financial house in order and increase profits? At Exigo Business Solutions in the Kansas City area, we work with many businesses in the skilled trades and are familiar with the problems that businesses like yours face every day. So, how can you make your HVAC business more profitable?
If your bookkeeping is not giving you the information that you need to effectively run your business, you need to change it. Certainly, if the numbers are incomplete or inaccurate you need someone else to do the job. But, there is more to good bookkeeping and accounting than just writing down the numbers and adding them up. Use Exigo Business Solutions, the top accounting firm in the Kansas City area, to do your books. You will get custom reports, insight into what is really going on in your business, and specific details that you can act on to (1) only take good-paying business, (2) reduce costs, and (3) routinely bank profits.
A common misconception is that a company will outsource the bookkeeping to save money on payroll and benefits and get the job done for less money. The truth is that you can outsource your bookkeeping and it can pay for itself by way of better understanding of and control of your finances. Contact us today to get your bookkeeping and your finances under control.
The standard approach to bookkeeping that has been used for years has two problems. Although the numbers are correct, the financial problems in your business are hidden. And, the profit that you deserve for your hard work is often just a dream instead of a guarantee. At Exigo Business Solutions we introduce our clients to an innovative new way to do the books. The numbers are all the same at first, but the Profit First method that we encourage our clients to use makes profit a habit instead of a dream and puts you on the way to controlling the excess costs that have been previously strangling your profits.
The first step in applying Profit First to your HVAC business is to simply rearrange the usual “bank balance” formula. Rather than this:
Sales minus Expenses = Profit
Profit First uses this:
Sales minus Profit = Expenses
You will set up separate bank accounts for your profit, owner’s pay, taxes, operating expenses and other categories as needed. And, you will allocate money on the tenth and twenty-fifth of each month to those accounts.
Thus, you will see a profit immediately.
Next, you will use the new system to instill financial discipline and reduce your overhead.
Here is where it is really useful to have outsourced your bookkeeping to someone who uses this system and generates reports that help you spot the weak points in your cash flow. Then, you will see where you are taking jobs that cost you money instead of making you money, and precisely where you can cut out inefficiencies and reduce your overhead.
To learn more about how you can make your HVAC business more profitable with the Profit First method, schedule a Profit Maximizer session today.
You know your trade and every job you do holds the potential for good word of mouth advertising as your satisfied customers tell others. But, how are you reaching the rest of your potential customer base? There are small business marketing essentials that can be applied to your HVAC business to bring more and better-paying clients to your door. At Exigo Business Solutions we can also help in getting you a presence on the internet. Take a look at our article entitled, What Is SEO and Why Does Your Website Need It?
If you are tired of “so-so” profits for working long and hard hours, take some steps today to change that situation. First of all, take a long and hard look at what you are getting from your bookkeeping. Then consider using an approach that allocates profit each month instead of letting uncontrolled expenses eat up your profit. And, last instead of first, look at how you can ramp up your business with more effective advertising on the internet. For help in any and hopefully all of these areas, contact us today at Exigo Business Solutions.