Let me tell you a story…
There was a time, when Tony and I weren’t getting the number of new cleaning jobs we wanted.
We were getting a steady stream of new accounts, but not enough to meet our aggressive sales goals.
We had been contacting all the buildings on our target list regularly and at first, we enjoyed a real wave of new work.
But then, things seemed to slow down… to a crawl.
We thought about it – and decided it would help to start going after some of the ‘low hanging fruit’ in other nearby towns.
Oh, so, what is this low hanging fruit?
Well, fruit trees often have some of their bounty, for example – apples, low and easy to reach – but, with much more of the fruit that’s – higher up, harder to reach and pick.
Again, you may be able to get to the high fruit – but it’s going to take a lot more time and effort.
By the way, I’m need to make it clear I’m not saying give up altogether on the harder to reach fruit (jobs).
Not at all.
You want keep marketing to all the companies that qualify to be on YOUR targeted list.
That’s how you get a steady stream of new business coming in to your business.
But, what I am saying, is you may want to look at targeting nearby towns or cities, where there may be weaker competition or less competition and/or where you’re message may really connect – now.
Whew… now that we’ve gone through all that… let me get back to the story.
It turns out, we had a good bounce (success rate) landing new accounts from our marketing to nearby areas – where the local commercial cleaning services may not be as strong, system- based or competitive.
And, I should point out that we DID realize the need for us to staff the account by hiring – locally (near the job).
That’s right – to travel to an out of town building to clean would have been too expensive. The fuel cost and travel time would have eaten up any profit.
So, we knew we had to hire locally, from the area near the account.
The problem was – we had been bidding out of town accounts using the same wage rate we used for bidding cleaning in our own city.
We thought our city is the same as every nearby city, right?
Wrong!
What we hadn’t considered was that while it might be pretty easy to hire part time office cleaners around us at $9.00/hr, it might not be that easy, or even possible to hire at that rate – out of town!!
That’s right, ouch!
Plus, even if we did get someone to agree to work for that wage, if they ever left to head for ‘greener pastures’ – we’d be left again trying to hire at a hourly rate that just wouldn’t cut it!!
And, if we had to battle turnover, we were pretty much sunk, due to the cost of sending our supervisors or full time call-off people to cover the cleaning at the account.
Well, we finally learned our lesson.
We figured out that when it came to pricing new out-of-town jobs… we needed to use a wage rate that would – get the account filled and keep it filled!
One last thing… I should say, since we were going to need to offer a higher wage rate to make hiring easier and keep turnover down… we’d have to make darn sure we were being efficient and productive!!.
So, part of the price of keeping turnover down was having to offer a higher wage; one which was maybe higher than some of the local competitors.
And, finally – we had to be sure our budgeted cleaning time was competitive so our price would be competitive too!
Growing geographically can open up new markets and jump start your growth BUT if you want it to last and be profitable – remember to set your wage strategically and price the job accordingly!
Discover the Guru in YOU,
Dan
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