Qualified Remodeler Magazine

MAY 2017

Qualified Remodeler helps independent remodeling firms to survive, become more professional and more profitable by providing must-have business information, namely best business practices, new product information and timely design ideas.

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marketing calculated with a target profit margin? If not, your prices are likely lower than they should be. ¡ Installation capacity: You are selling more jobs and your backlog has grown, but so have customer complaints due to delays and perhaps slipshod workmanship. Are you properly ramping up your operations to match the revenue growth? ¡ Slower cash flow: is relates to installation capacity. If it takes you longer to get jobs complete, delays in invoicing and payment will arise as well. GROWTH CAN be fool's gold. Profitable growth is hard-won, requiring careful plan- ning and execution. If it were easy, everyone would do it. I recall being somewhat surprised last fall, at the time, when Washington, D.C.-based re- modeler David Merrick, CR, said he planned to deliberately reduce his top line in 2017. His goal is to take home the same amount with less risk and less time spent on it. Makes sense to me. At Qualified Remodeler, we celebrate revenue growth via our annual Top 500 list, which will be published in August. Most Top 500 companies are managed well enough to ensure that more revenue means greater profit, but there are exceptions to the rule. My hope is that you and your business partners, as you enjoy the fullness of a robust remodeling market in 2017, take the time to ensure the extra profits you deserve. | ver go to an industry conference or meeting and come back with so many notes and ideas that it takes several days afterward to fully pro- cess them? Better question: How about all the side conversations you had with speakers and industry friends when you were there? Do you have a way to process those, or do you hope they just stick with you? I ask because I keep going back to conversa- tions I had with company owners and industry experts at our Top 500 Live conference held earlier this spring. So much of the conversa- tion was about revenue growth. And this is as it should be. But there was also a consistent undercurrent of how best to achieve profitable growth. What is the point of driving revenue if less of it is falling to the bottom line? Millions are being put at risk each month to operate your businesses, so at what point does it make sense to simply close up shop, take the invest- able revenue, and invest it in equities or other, more liquid assets with less risk? Kind of gets you thinking, or at least it should? IN AN ARTICLE published in our April issue, consultant Brian Smith of Dave Yoho Associates put it this way: "Too many companies put en- tirely too much emphasis on top-line growth and not enough emphasis on bottom-line growth." e article, "Was 2016 Really the Great Year that Might Have Been?" can be found on our website and offers a list of signs that your growth might be hurting you. ¡ Marketing: You spent more on marketing and drove more leads, but your cost-per-lead rose and your conversion rate dropped. ¡ Price: Are all of your expenses fully load- ed with every expense related to sales and Chasing Revenue Can Cost You E 6 May 2017 QR QualifiedRemodeler.com EDITORIAL DIRECTOR'S NOTE Patrick L. O'Toole Published by SOLA Group, Inc. 1880 Oak Ave., Suite 350 Evanston, IL 60201 847.440.3000 Publisher and Patrick L. O'Toole Editorial Director Patrick@SOLAbrands.com Ext. 103 Senior Editor Kyle Clapham Kyle@SOLAbrands.com Ext. 107 Associate Editor Kacey Larsen Kacey@SOLAbrands.com Ext. 105 Proofreader Nancy Mueller-Truax Audience Development Mike Serino MSerino@magservgroup.com Creative Director & Tracy Hegg Production Manager Tracy@SOLAbrands.com Editorial Advisory Board Stephen Gidley, GMB, CAPS, CGP, CGB, CGR, CPRC, CR Jeffrey Holloway, CKD, CBD, CGR Michael Nagel, CGR, CAPS Scott R. Sevon, CGR, CAPS, GMB, CGP, GMR Donna Shirey, CGR, CAPS, CGP Kenneth P. Skowronski, CR Midwest and West Paul DeGrandis Sales Manager Paul@SOLAbrands.com Ext. 100 Midwest Sales Manager Jessica Fidrocki Jessica@SOLAbrands.com Ext. 117 East Sales Manager Beth Emerich EmerichB@SOLAbrands.com Ext. 101 National Automotive Tom Lutzke Sales TLutzke@ACBusinessMedia.com Literature Galleries/ Mike Serino Classifieds Mike@SOLAbrands.com Ext. 102 Digital Programs Tim Steingraber Manager Tim@SOLAbrands.com Ext. 106 Projects Manager Heidi Riedl Heidi@SOLAbrands.com Ext. 111 A preferred publication of the National Association of the Remodeling Industry and the NAHB Remodelers

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