¶ The Changing Landscape of Trades Business
All right , don't say anything crazy . We're recorded . Now we're on the air . Nothing , nothing crazy . This is the bonus episode of Make Trades Great Again podcast . Hey Andy , the other day I was listening to Denys the Apprentice cool podcast he has and then I was watching the Facebooks of all things I hate when I find myself over there .
I'm not proud of that , but I was checking on something and I saw a post over in House Called Pro and long story short . I think what we are experiencing is starting to freak some people out . We were super , super busy through COVID . We got crazy . Everybody's like name your price . Yeah , you want it done next week . How about next year ?
That whole , we're in charge . We're the captain now . No , no , no , no , we're the captain now . Right , yeah , by the meme .
Okay , my point is everybody was crazy busy for a very long time and I know some people listening to this are not going to be experiencing what I believe is probably the majority of the country is really starting to see it go back toward pre COVID levels of calls coming in size of projects , workload , everything like that .
I'm not saying people don't have work on the books . What I'm saying is I think the calls coming in or less . I think the size of the projects are different . I think what people are willing or able to spend is different than it was a couple of years ago .
I would agree with that . If you'd asked me two or three weeks ago , I'd probably said eh , not here , I don't want to sound like we're slowing down . We just had a conversation with Cheryl and I we're driving back from a wedding and we were having the conversation in the truck . I don't know why it is .
You and Heather probably have the same kind of conversations about business or about whatever . I don't know why we could talk about anything .
No Is that what you mean ? You don't know why .
You don't know why you talk about business . We default to business .
It's a huge part of your life . It's the way it is . I'm not trying to speak for everybody or anything like that . I'm not trying to uncover any crazy ideas here . I think what I was getting at is , I think people are this Facebook post . It said , basically are you guys having a regular year ?
I'm out there and I'm not getting the bids I thought I was going to get . It seems like people are going with bigger , more expensive companies . There could be a lot of reasons why that happens . There could be a couple of reasons . Basically that come to mind quickly . I'm not getting the same amount of calls that I used to get . You know why ?
People were getting calls like crazy ? Because everybody was so busy that they weren't answering the phone . When they don't answer the phone , or you do answer and you can't get to them , you tell them it's going to be three months before we can install a cooling system for you . By the way , it's almost August .
You're not going to need it when we can get it to you . These people were just calling the next one in line , the next one in line , the next one in line . During that process , people started their own shops . It makes total sense . It makes total sense .
I think these people that started up a lot of them probably are very much like I was when I started up not fully prepared for it to be there to be less work than I thought there was . Right , then there really was for a while because of COVID . Go back to that whole COVID thing . We were pulling our hair out just trying to make it through the week .
By the way , a new week starts tomorrow . It just happens all over again . It was over and over and over . Just one job after another . Name your price , you got it what . It's not that anymore . It's just not Not for the majority of people who can hear this podcast right now .
Right , I think that is true . I don't feel like right now , what we're seeing is a large portion of our customer base of the customer base that's hiring , service , trades , right , is basically tapping the break . What's going on here ? Yeah , absolutely , our interest rates higher . Now there's a handful of things that are going to come into it .
In reality , you have to look at it and say , well , raising the interest rate did exactly what the intention was . Right , it's to basically pump the brakes on the economy .
Yeah , I mean , there's a few things that hasn't pulled through on , like it hasn't adjusted the pricing properly for housing and things like that . But yeah , and more than ever , the stuff we're offering up , the materials we're buying , the services we're providing , it's costing us more than it ever has before too .
Yeah , definitely , I look at . So if you look at and I'd encourage you to do it , because it's kind of like eye-opening go back to February 2020 or December of 2020 , december of 2019 . Pre-covid and pre-COVID and look at a boiler bid price .
Oh God , it's crazy . It's crazy . I'm like just almost 50% higher . Yeah , I was going to say even my , just like the standard . You know , 100 series , non-combie , so heat only with an indirect . You know , three years ago that was $8,900 bucks Single zone , no problem .
Yeah , it's $14 grand . $13 grand now it is . It's crazy All day long .
It's nuts , it's nuts , it's so crazy .
Yeah , so I and you look I'm not trying to pick on these guys and gals either that are kind of , I think , unfortunately from varying degrees of their own experience and their own situation , but I think they're seeing that it was awesome , it was so awesome , and now it's just going back toward normal and it's probably freaking a lot of people out .
It's free , it is freaking people . I've seen the comments . People are , you know , the ones that are willing to admit like , look , it doesn't seem the same . It does seem like it's slowing down . It's not like it was a year ago and I'm only a year into my business , you know that kind of thing and I go oh crap .
I went through a different Facebook conversation in the last week and the comment was the direction of the conversation was hey , we subscribe to XYZ Lead Service and we do this and we do that , and we're right now we're spending $2,500 a month on lead generation what and you know ? And we're only getting like six or eight qualified leads a month .
And I'm like , oh my , that's like 300 bucks a pop , right . And I'm like , dude quit , oh , like you know , and I don't know , I mean , here's the deal . It's probably 400 .
Yeah , that's crazy , right , that's crazy .
Yeah , I know I'm like I'm gonna look at that and go , holy cow , we're I mean we're , we're bang booked . There's a ton of stuff on the books , right , and we don't pay , haven't paid any advertising . All year We've donated some money to some , a couple of organizations . That's been our advertising .
You know , the wrestling poster , the cheerleaders , have gotten some money , you know , because they put our name in the back of the cheerleader flyer , whatever . I mean , there's a handful of things like that that I'm like , yeah , no , give them 500 bucks . I don't give decks yellow Any money . Are you kidding me ?
I don't want to give , you know , any of that , any money at the moment , and I don't know that I ever will again . No , because I don't know . I don't know why you would believe that it , even pre COVID , was giving , giving us any benefit . I feel this is my opinion and I know that people will say , oh , no , you don't .
You don't understand how the whole thing works . You don't understand the economics of it . I look at the companies that have , over the last three years , specifically said we can get 50 , 60 , $70 an hour more because people need us . Yeah , those are the companies that are going to be like they've . They've set themselves up on this pedestal .
This , this like fast track of like we're . We made a lot of money in the last couple of years . It's been phenomenal business , yeah .
That's great . Yeah , yeah , right , people are paying and paying out there whatever , they didn't know which way the check was coming in .
Yep , right , and and everything was great . And I feel like those companies are going to see a big break pump unless they adjust . And I'm not saying that they have to drop their price .
They'll probably double down what they're spending to get the calls to come in . They have the resources to convert those to sales . That's the thing . Yeah , so it's pretty tough though Small customers , small companies like my own , like yours , you know you do rely heavily on that call to come in .
Yeah , I , yes , you , do you rely on that call to come in ? In my opinion , the things that are going to sell jobs is less of all the bells and whistles , but sell value on customer service , sell , sell that job based on the value that you physically , are going to provide . Your technicians are going to go in .
We're going to provide you this valuable service . Yeah , we're going to provide you a quality piece of equipment . We're going to provide you the accessories and the and the pieces that you need . We're going to do we're going to do you a solid and it's going to be a good system , and you're going to pay a premium price for it .
You know what ? Yeah , you know what they're doing around the Twin Cities , though I'm sure it's this way all over the country . You're right , I totally agree with you . But to counter so , I always play that kind of devil's advocate , right ? Yeah , yeah , I'm . I'm wrestling with the idea of how do I change what I offer to offer that value , to make that sale ?
Yeah , when my competition is selling with a backup of , like , lifetime warranty , I'll put a boiler in for you and I'll give you a lifetime warranty , right , like I've never .
I almost it makes me almost want to hire that company to put a boiler in my house so I can read that that contract , yep , and then make that contract my own , and you know what I mean , yeah we've got one or only this , that's advertising , 10 years parts and labor On every , every service call . That's crazy .
I'm like .
So that's what's selling for these company . Well , I know , but that's what selling for these companies is . You hire us and now you're in our family , right now we're together and you got us , you know we're good , we're gonna take care of you , and I don't know how that works out . Plus , I wonder just how many people move before that lifetime warranty .
It's not transferable or so transferable . Yeah , I have one bit of Advice , just kind of a blanket , apply to this . You know , is anybody having a different kind of summer ? I asked you know , like , is it ? Is it changing or things changing around here ?
Because I started two years ago and it was , you know , I Got this big truck and I'm doing well and this is great , and now it ain't . You know that kind of thing , yep , one thing that I will say , if I could come up with one idea that has helped me the most Over the last , you know , a handful years . Yep , and I don't always do it .
I try so hard . Sometimes I cannot , but when I can and that's probably an eight out of ten site visits when I can , I do not leave without giving the customer the proposal . Yep , if I leave and I got to go look up a price or get back to him with this or that info
¶ Closing Rates and Cost Trimming Tips
. I Think the close I don't have numbers , but I'm gonna Exaggerate a little bit . I'll bet you my closing rate goes from like 78 , 79 , 80 percent to 40 , 40 , half as much . Yeah , let's call it that .
Yeah , I would love to say on the air for everybody to hear that my closing rates in the night it's not , and I think 80 percent is pretty darn good , because I can't it kind of jobs I'm Closing on are definitely , you know , they're bringing in there , are , there's profit applied to them and they're not big projects that are taking year long .
Your , you know it's six months to complete things like that . So it's good cash flow , good , good business for my style of business . And as soon as I leave and I say , oh , I'll get you them , I gotta , I gotta check a price and I'll get back to you . I hate that .
In fact , if I even question if I got a close enough price in my book , I can adjust it and just so that I can give them a price before I leave , yeah , it might not be fully accurate but I'll have to inflate it a little bit just to make sure that I'm covered Right and because I can look and see when maybe the last price increase on a piece of
equipment was and I'd be like , yeah , I guess we'll just add another 250 bucks just to make sure we're good . And then boom , because when I leave and they've got the price in hand and maybe option one two , maybe option one two three , that kind of thing , right .
So that's my advice to these younger people starting out and they're starting to see things change . Go back to pre-COVID kind of activity and mentality and spending habits and things like that . Yeah , if you're out there and you're bidding a job to fix , you know , install something , replace something , if you're not handing them the price , right then .
And there , then you're not doing it right , yeah .
Yeah , I guess , if I don't , I do not disagree with you on that at all . I have also seen the same thing . The other tip that I guess I would say that we that something that we have done when we've had these a lull in business , and we've seen it every couple years .
Yeah , something changes in economics , sometimes season , that time of year , yeah , yeah , whatever . And something that we always look at is what are we spending money on monthly ? If you're at that point where you've all of a sudden recognized like we're not as busy as we used to be , like what are we going to do at that immediate moment in time ?
Pull up your bank statement from last month , your credit card statement , whatever , and go through and highlight every single thing that's a subscription service . Look at those things . Do you have an extra app on your phone that you were using to quote projects , or some extra camera app or something like that ?
I mean , if you're saying to cut costs , if you don't need it . Basically trim your expense . Oh , okay , sure . Ultimately , if you don't have the business coming in , you can't play like you're the million dollar high roller .
Yeah , yeah , no , you're right . Yeah , I didn't even think of it that way . Yeah , definitely .
But look at how things are going to change . And for the guy or the gal that started business two years ago 2021 , right , the heat of the market Things have been gravy for the last two years , basically got a good job that you went on . Yep , and those folks are right now recognizing that this isn't the way it normally was .
Yeah , no .
And people just needed warm bodies before , right . I made the comment to Cheryl , the other here , about two weeks ago . I said I don't know how long it's been , and I said this is not something that I would like to say out loud frequently , but every now and then I'd like to really have to work to get a job , and that's a lot .
There's a lot of truth to that , because if you're throwing numbers at , you're looking at something you're like , oh , that's what it's going to be , and you send the estimate and you get an approval Boom .
Two hours later , three hours later , eight hours , you know , the next day you're like holy crap , and you're seeing it over and , over and over again and you're like , wow , this is insane , this is great . But then that you get to this point where , all of a sudden , you're like I'm going to bid it at $250 an hour .
Now you know our total hypothetical number , but right .
I mean because all the sudden you're like 150 or whatever . Right , Just for comparison .
Because I'm just going to throw a boatload on it and see if it sticks Right . You know we're going to make real money on this job and you know I mean those are the kinds of things that you learn the hard way .
¶ Tips for Improving Job Performance
And I and I question you know , when somebody's saying I haven't been getting , I haven't been winning the jobs , I'm not the big guy , I'm not you know like , particularly like this particular Facebook user , I , I , I guess I'm going to encourage them to go back to the drawing board and identify what your costs are and figure out why and call that customer , call
the last customer . See what they say .
Call every single one of the last customers .
Hey , I'm . I'm just reaching out for a courtesy call here . I'd like to know what you ended up doing . Why did , why did you not select me ? Totally be honest , Was it the way I smelled ? Was it the way I dressed ? Was it the way my van looked or my truck looked ?
Yeah , you might get a , you might get somebody that's honest with the entesia Exactly what you need to hear and then you have to , then you have to act on that and you got to put your tail between your legs . Yeah , no , you're right , but it's probably probably does come down to a couple of things .
Like you're going , like the direction you're going with the pricing , maybe , maybe you're just Been it too high and you don't need to not that you shouldn't become , you still have to cover all your costs , everything like that Absolutely but maybe you're just your numbers were too high and then and they were , you could support that during cove it , but things have
changed . And then the other thing , too is it probably comes down to like sales training . You know what I mean is , which is something that I could totally benefit from but a lot of a , a lot of us out there in the field that are running our own business and stuff have not had that formal training .
Some have , some have come from companies that you've been trained really well and I wish I was , wish I was one of those people , but that's probably a big part of it . It's probably something a little more complex than hey , did I smell bad .
Yeah , but you know not that you know what I mean , but here's , here's what I'm gonna say , and and this is coming from a Former tobacco user I haven't , I haven't used any in a long and quite a few years ten years anyway , sure and I would say I Get more compliment From or not . Compliment Not , I don't get a . You smell good , that's that's I get .
Gosh , the last guy that came Smelled like he was smoking a cigarette when he walked through the door . Oh yeah .
Yeah , well , there's that all together and yeah , absolutely yeah .
I would say if , if , if you are , if you , if you're a smoker , you know what ? Whatever do yourself , never quit , quit , yeah , quit . I'm gonna say it . I'm just gonna come out and say it quit .
I don't know why you were nervous about it . I'm gonna tell you freaking hands if you're a smoker , it's gonna kill you and it's gonna hurt the whole time you're dying .
So there you go if if you , if you do , do a one simple thing . Blue monster Makes a hand . Why hand wipe like a cleaning towel that smells like oranges ? Yeah , go get a jug of blue monster wipes , put them in between the seats on your truck . Do , when you roll up at the customer's house , do a shower in your front seat . Yeah , exactly Right .
That's funny because you know , surprise you how many people that it turns off . Another smoker won't even know , they will never even recognize it . But someone who's a non smoker 100 , 100% can probably smell you from the end of the driveway . I can't stand it .
So I'm just saying but yeah right , you do , you , yeah , if .
If you're , if your job is to come in and sell something , appearance and how you smell is gonna play again , play apart and absolutely there's a lot of things that are gonna have to be looked at closely by everyone and anybody that's also been through this .
I've been through it . I started in 2004 , like I saw 2005 , something like that . I don't remember what the coffee cup says , but you know , you gotta , you gotta , you gotta adapt for sure , and we've talked about that , but yeah , I think it's .
I just wanted to bring it up today , real , you know we can end it there , but I just wanted to bring it up like it's not the same as it was and it's not gonna be the same , as I don't predict . I don't particularly think it will Get as busy as it was anytime soon .
Anytime , maybe , I don't know , maybe you keep going like big gang , but I don't know it might , it's not like , oh , put it that way .
No , no , it's probably not , but that's something that that we're looking at doing right now . What are we looking at right now ? Number one thing that I that comes up on my , my Direction is how to what . How do we provide the most value For the hour that we're gonna bill for , right ? That's , that's what the customer wants .
That's , I mean , that's what shifts . Shifts , the change from them taking the cheap guy to them paying maybe a little bit more to have me , is the value .
Yeah , and you know what , though , if you don't have the right training to get that conversation , to get that information across , then you're not gonna , it's not gonna matter , no you know what ? I mean , it does come down to communication , training how you smell , how you look , don't be late . I don't know .
I don't understand these guys that think that they can just be late like at all .
If I'm going Maybe it's a Midwestern thing , maybe it's just how I was raised like , if I feel like I'm gonna be on Time , I tell the people I might be five minutes late because I'm freaking out , because all it takes is on you know blue hair to pull in front of me and whatever Doesn't know how to use a roundabout a room to boot All right , dude , we got
¶ Wrap-Up and Call for Feedback
it .
We're long on this one .
We gotta end it there . Do it All right , everybody . Thanks for listening . Check out the show notes . There's links in there . You can message us , tell us what you absolutely don't want to hear us talk about anymore , or tell us what you think we should talk about . We do appreciate any feedback . Good , bad , indifferent , I don't know .
Andy , tell good the bad and the ugly . Yeah , there you go . There you go . All right , dude , have a good one , see you .