The Profits are in the Process
- June 2006
By Troy Liposec
People wonder why they should adopt new processes... when they think the old ones work just fine... if I were to have surgery tomorrow, I'd much rather have a shot of Demerol than a shot of Jack Daniels - Charles Sanford
While talking with a fellow window cleaner recently, he said “That sounds like too much money for a window cleaner to make”. I explained that the prices were comparable and it was only the methods that were different. After I explained how he could be more efficient by adopting a new process and therefore increase his profits, his answer was simple;“That sounds like something I could do!”
The methods for increasing profits in a service business are numerous. I think that everyone will agree that if you are not continually increasing the amount of money you’re making, your business will eventually falter. If you are a one-man operation, or a one hundred-man operation, learning more efficient processes to adapt into your business, or improving your current methods, may be the most cost-effective way to increase your profits.
You need to take into account all areas of your business. There are many processes to consider, from prospecting to completing the job. Given the fact that a window cleaning business is one of repetition, becoming more efficient in any area multiplies your time savings and profit potential. Saving only a couple minutes per step can make a big difference in making more money or losing it, 10 minutes wasted per business day equals 40 hours in a year. Find ways to recapture that time and you are on your way to increasing your profits. After all, it has been said that the heart of managing a business is managing its processes.
You need to be organized to be efficient. How do you schedule accounts? Are they scheduled close together, or do you find there is a lot of down time driving? How organized is your vehicle? How efficient are you and your crews at performing the services you offer? Are you using the most efficient methods for each individual job or do you do every job the same way? How long does it take to set up and break down at each job? Can you save a few minutes cleaning the windows, screens, etc.? In order for any process to be the most profitable, it must be the most efficient.
The fastest, safest and most efficient way to clean windows is a water fed pole. While most window cleaners still use a squeegee on all exterior windows, a tool that is not much different than it was 65 years ago, many window cleaners are boasting of time savings using water fed poles. A water fed pole can not be used on all jobs but the time-savings are amazing on the jobs it can be used on.
Does a job with 20 windows get the same rate as the job with 100 windows? Consider that you need to complete five jobs with 20 windows for each job with 100 windows if they are charged the same rate. Consider that there will be a lot of drive time between the five smaller jobs and the extra set up and break down time involved with doing them. Consider that more time and costs are involved with the extra bidding, scheduling, gas, costs of labor, etc. Because of this, the rate needs to be higher on the smaller jobs if you are going to produce the same amount of income as the one larger job in the same amount of time.
Raising prices is usually the first thing people associate with making more money. If your prices are below the current market value for window cleaning services in your area, then this might be a good place to start.
It’s easiest to raise your prices regularly by small amounts. Your customers will get used to the process and it won’t be a big deal. This is an important process since your expenses increase regularly by small amounts as well. On the other hand, if you wait a few years and find yourself doing the work for much less than it is worth, it might be more difficult to increase the price to the current market value.
Some people have a problem when it comes to raising their prices. They seem to have a fear that they will lose customers. There are ways to ease into price increases to help overcome this fear.
Let’s imagine you’re only doing 3 jobs per day at $125 each. If you raised your prices by only $10.00 per job you would be making an extra $30 per day, $150 per week and $600 per month. This is one person in one truck, what if you could make an extra $600 a month per truck? These figures represent a mere $10.00 increase in price. It is very unlikely you will lose customers with such a small increase in price.
Let’s imagine you will lose at least a couple customers that want the absolute lowest price they can get, so they use someone willing to do the work for less. You can actually afford to lose 4-5 customers per month and still make the same amount of money you are now. This is if you don’t pick up 4-5 more customers at the new rate to fill their place.
- Adding more income per Job
If you're only doing 3 jobs a day at $125 it may be difficult for you to add in another job initially. What about adding more income to the jobs by offering to do something extra? If you cleaned the mirrors at one job a day for an additional $15 it would add another $75 more per week and $300 more per month.
So, between the process of a small $10 price increase per job and cleaning the mirrors at one job a day, you could make an extra $900 per month!
Adding services to your business that complement window cleaning can be a great added source of income. This is true whether you’re just starting out or already have a large customer base. This is because anytime you can do additional work in one place you eliminate downtime driving to the next work location. Also, with many add-on services you can actually make more per hour than you can cleaning windows.
You should not price add-on services at a window cleaning rate. This defeats the purpose of offering add-on services. Offering additional services at a window cleaning rate only saves you on drive time between jobs because you are working in one spot longer. However, many add-on services require more costs to complete. Determine the market value for the additional service and sell the service at that rate.
The better you are at cleaning windows the closer your window cleaning rate will be to the rate you can make doing other services. Even for the most experienced window cleaner add-on services should make you more than your window-cleaning rate while you’re learning to perform them. If the add on service will not make you more than you can make cleaning windows, then don’t offer it. Just because the customer wants something extra done does not mean you should accept the job. Stick to services that will net you a higher rate than you get cleaning windows and you will be happy offering the additional services.
One of the best parts of having a service business is that once you find a customer, and provide a great service at a fair rate, the customer will call you the next time they need your services. These repeat jobs usually can be completed quicker the second and third time around simply because you are familiar with the processes that are efficient for the job. These jobs are also more efficient to schedule because there is no bidding time involved. These customers are familiar with you and your pricing and they are willing to pay extra if a price increase is in order. Since these customers are satisfied with your service they are also likely to use add-on services if you offer them as well.
The process of increasing your profits starts with providing a great service to your customers.
Customer satisfaction is the foundation for any successful process in which you and the customer both will profit.
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