Tapping Your Unseen Business Potential Brad Dawson, LTV Dynamics

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#1 – Employee Retention Employee retention rates are a good indicator of corporate health

#1 – Employee Retention High turnover in sales and marketing may mean a heavy reliance on new customer acquisition or a reactive sales environment

#1 – Employee Retention Did you know that most electrical contracting firms are only achieving 6% of their revenue potential?!?

#1 – Employee Retention Proactively move existing customers down a path that includes assessment offerings, implementation projects and maintenance services (AIM)

#1 – Employee Retention High turnover in operations may indicate a too diverse product and service offering portfolio

#1 – Employee Retention Inexperienced contractors may be more focused on getting any work and miss the nuances of a “good” project contract

#1 – Employee Retention Establish realistic pricing and delivery standards. Don’t fall into the commodity pit – where low price wins

#1 – Employee Retention Low levels of turnover in finance and administration may indicate a bloated profit stealer

#1 – Employee Retention Use the “Rule of Threes” as a guide to determine pricing and operational parameters Payroll Cost Administrative Costs Profit

#1 – Employee Retention Create bonus incentives for your bookkeeper to reduce administrative costs on an annual basis

#2 – Corporate Wide Utilization Defined as the chargeable time that is allocated to billable work. The corporate wide target is 80%

#2 – Corporate Wide Utilization The worst culprit for busy firms that are not hitting the ideal utilization is often the owner What, Me?

#2 – Corporate Wide Utilization Exceeding 80% can lead to employee burnout

#3 – Sales Effectiveness Some sales people are optimistic “mad dogs” that hold onto bad opportunities far too long

#3 – Sales Effectiveness Use the sales tools to qualify and quantify new customer opportunities

#3 – Sales Effectiveness Only 10% - 20% of revenue should be from new customers. Focus on growing existing customers!

#4 – Reinvestment Strategy Electrical contracting firms should look to reinvest as much as 20% of their gross revenue

#4 – Reinvestment Strategy Also look to “buy” into horizontal and vertical markets

#4 – Reinvestment Strategy Research Reward Reinvest Review The Business Cycle Release

#5 – Hiring for the Position Are you hiring your firm’s future leaders or just someone to fill the open position?

#5 – Hiring for the Position Realize that upwardly mobile contractors need customer relationship skills; an aptitude for project management; and financial insight

#6 – Break the 80/20 Rule 20% of your customers generate 80% of your revenues. So, why do you keep your under-performing customers?

#6 – Break the 80/20 Rule Replicate your large customers. Small customers waste too much time!

Thank You! Contact Information: Brad Dawson LTV Dynamics