Gaining efficiency may not have to be so drastic. “One way to do it,” King says, “is to ask employees, and then implement their suggestions. For example, ‘If we had to save $100 per month, how would you do it?’ or ‘In order for you to be more productive for one hour a day, what would it take?’ Don’t ask, ‘How can we decrease overhead by $10,000?’ Most workers can’t get their heads around that.”
Whether you consider input from employees, books, or mentors, you have to grow with direction and intention. “Focus on core competencies,” Richardson says. “If you do residential stucco, branch off into doing stucco on commercial buildings.” And whatever your goals, make sure you have enough cash on hand. “You can grow yourself out of business by not watching your cash,” King warns. “You need at least six weeks of payroll in the bank before you start to embark on a growth strategy.” Of course, overhead will increase before revenue catches up. Grow up, grow out. Awkward alternating with sturdy. But in the end, those increased revenues will help you create opportunities — and isn’t that why you’re in business?
Growth and Community John Abrams, co-founder and CEO of South Mountain Co., a 30-year-old employee-owned design/build company on Martha’s Vineyard, Mass., has a different take on how to judge growth. “Conventional wisdom implies that small businesses are those that just haven’t had greater success yet,” he writes in his book, The Company We Keep, detailing South Mountain Co.’s history and the importance of being part of a larger community.
In an interview with REMODELING, Abrams defined growth as “a larger work-force — more mouths to feed — which may result in a better or stronger bottom line, or it may not.” He adds that, “It may also have other effects that are either desirable or undesirable.”
In his view, there is more than one bottom line. “We have at least three that matter to us,” he says. “The first: that we’re making sufficient profit to allow us to do everything we want to do — pay people well, do good work in the community, provide for our future. The second is environmental; we want to have the lowest impact we can. And the third is social; we want to provide a service and do the best and most meaningful work we can. We always look at all of these.”
Abrams recognizes that for remodelers with less than $1 million in volume, it’s “tough to have the office infrastructure to really be able to look hard at your business all the time and think intentionally about where you want to go. But when you get over that,” he says, “it’s time to change your business and think about it not only as a provider of services but as a community of workers that needs direction, needs to think critically and outside the box, and to think long-term. Then you have the possibility of insisting on designing the future you want instead of accepting the future you get.”