SPRAYFOAM Professional - Winter 2015 - (Page 43)

making monEy your oWn PicturE oF succEss By maC sHELDon aking money as a subcontractor is as much an art as a science. Yes, there are some iron-clad rules in business, but most of the long-term profit generated and retained by a successful business owner is a result of artful customer relations, artful labor management, artful money management and careful attention to the craft. Certainly the basic rules of business must always be recognized and strictly adhered-to such as timely payment of your labor, taxes, supplier, all of your other creditors and your growth fund before you pay yourself. We must also collect receivables when due and complete jobs in a timely and workmanlike manner. But it's not just what we do but how we do them that makes all the difference. If you've heard me speak, or read previous articles, you're familiar with my basic tenet of the sprayfoam business: >>Billings-Out. >>Collections-In. >>Take Care of the Customer. ....In that order! Some sprayfoam contractors tell me they're inconsistent with invoicing and have no regular schedule for sending bills to the owner or general contractor. You worked hard to get the material, your spray rig and your crew to the job and you did a fabulous job insulating and air sealing the building - and now you have a lot of your money invested in your contractor's job. You deserve to be paid according to your terms. So what's your plan if a check for payment in full doesn't arrive on time? First examine your collections process. Did you send your invoice by the date or day of the month the builder or GC has set as their cutoff? Most GCs take one draw every month from their line of credit or from the owner and only pay the bills submitted by their cutoff date. How do you know? You ask, of course! Communication is the key and it's an art not understood by all subcontractors. The time to ask about the GC's payment schedule is when the proposal is presented. Whether it's presented face to face (by far the preferred method) or by mail or email, the question should always be asked and the answer committed to writing. Here's an example: "OK then, we'll be out on the 14th to spray your project and we estimate it will take two full days. Please make sure there are no other trades scheduled for the days we're working since we can't spray if others are present. We'll send our invoice on completion, so would email or postal mail be more convenient for you?" Write their preference on your proposal then go on to ask about the GC's payment schedule. "Do you cut checks on a particular day of the month? And, do you have a cutoff day so you can get your payments processed?" Crafting your questions so they're non-aggressive yet collect the needed information in a friendly and business-like manner is a key element in the art of getting paid. If you weren't able to meet with your customer to present the proposal, I would call them to thank them for their order and ask about the terms over the phone. I'd offer my telephone and email and encourage communication if you can assist in any way. Next, I'd follow the call or email with a hand-written note of thanks and a second copy of your proposal with the terms you agreed to over the phone. Conversely, some sprayfoam contractors manage their billing by sending the invoice and waiting. If they don't get paid when they think they should, they might call and cuss out the GC or leave a terse or threatening voice mail. I'm a fan of talking about the debt before it's incurred and following up with written communication. In good times like we are enjoying in many parts of the country right now, the poor communicator might still get work, but when (not if) we have another downturn in building, the communicator will likely stay afloat provided he artfully manages his business. The same principles can be applied to labor management. Craft your commitment questions for your workers to help them understand the importance of getting the work done on time and to your high standard. Then, lead the crew to implement work-practices www.sprayfoam.org ©iStockphoto.com/azerberber M | sprayfoam Professional 43 http://www.iStockphoto.com/azerberber http://www.sprayfoam.org

Table of Contents for the Digital Edition of SPRAYFOAM Professional - Winter 2015

EXECUTIVE DIRECTOR’S CORNER
PRESIDENT’S POST
FOAM BUSINESS NEWS
SPFA TODAY
LEGISLATIVE UPDATE
SAFETY FIRST
Sprayfoam 2016 Convention & Expo – February 8-11, 2016
SPFA’s History Proves Our Perseverance
ABAA NEWS
SPF Research on Air Quality – PART 1
2015 SPFA CONTRACTOR AWARDS
MAKING MONEY: Paint Your Own Picture of Success
ASK THE EXPERT
UPCOMING EVENTS
INDEX OF ADVERTISERS

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