The typical electrical services firm operates on 2 percent margins, and the failure rate for these businesses is high. What’s going on here is price competition. The problem is, nobody really wins that competition.
If you’ve negotiated project pricing, you’ve probably heard, “Another firm will do that job for $5,000 less than your proposed price.” What was your response? Did you offer to match that price, then hope to make up for the loss with another project with this customer if your work is successful?
Then during the project, you try to stem the losses. There’s pressure to meet tight deadlines, do more with less, etc. How did that job turn out? Were you proud of it? Can you showcase it?
Consider the results from a different response. You say, “We have no argument with that firm. They know better than anybody what their work is worth. But maybe I can show you how they arrive at that price.”
Then you pull out photos you’ve taken of their work in other facilities. You explain that the customer called you in to fix problems (or perhaps you did a free testing and analysis project to gain entry then asked them who did that work). As you show each photo, you provide a similar one showing your excellent workmanship and your high-quality, high-standard work.
You’re likely to get a price that will enable you to do the job right. And you’ll have another project to showcase.
Allowing your workmanship standards to slip and expecting your business to have a good reputation is like chiseling the points off your screwdriver and expecting them not to strip screwheads.
Good workmanship does require extra time and attention to detail. But it also requires methodology. So insisting on a culture of good workmanship produces a much lower callback rate than a “cut corners” mentality produces.
One “reason” for slipping workmanship standards is to clip costs wherever possible on an underbid job. Your first defense is to bid accurately and stick to that. If others underbid, show your customer why their bid isn’t qualified.
If you look at other cost-cutting means, you may escape this scenario entirely. As already mentioned, the methodology-based work environment already reduces costs. Here are some other ways:
- Invest in technology. Not just test equipment, but anything that can save time. For example, wireless data transmission from the job to the billing department takes less time than filling out and filing paper reports.
- Eliminate non-value-added activity. Do your techs make runs to the store or the shop for parts or materials? Fully stock your service vans, so they don’t have to.
- Train relentlessly. How much time on the job do your techs spend figuring out how to do or re-do a task? Don’t just send them to the training du jour. Target to their actual needs. Observe them on the job, and ask them which areas they want better training in.
Instead of allowing workmanship standards to slip, get extreme about them. Examples:
- Cabinet wiring must be neatly routed, with proper bends. It needs to look artistic, and it will look that way if the bends are made consistently using some sort of arbor. Often, the side of a pair of pliers serves well as that arbor.
- Measure the distance between cable ties and other supports, to give a uniform aesthetic.
- Use end-cutters to neatly clip cable-tie ends.
- Use a professional label printer system, not handwritten tags, to label wiring.
- If installing EMT, decide which way the set screws should face and set them all to face that way. It’s subtle, but it’s effective.
Workmanship doesn’t apply to just the actual work performed, but the total job. Examples:
- Always clean up. Leave it at least as clean as you found it.
- Ensure your workers look professional. This means such things as electrically rated footwear that is appropriately shined, wrinkle-free uniform (yes, these are available in cotton) instead of blue jeans and a t-shirt, and always wearing the proper PPE.
- Keep your service vans clean on the outside and organized on the inside. Arrange with a local car wash to provide discount tokens; have a helper, not your high-paid techs, drive through.
- Put your techs through a defensive driving course. They are driving your billboard down the highway. This also means you have a strict “no talking on the cell phone while driving” policy.
- Properly maintain your test equipment. Nobody really saves money by taping a damaged test lead, but this careless act sends a strongly negative message about your company.
Workmanship is well worth it. But you have to work at workmanship. Think about how you can differentiate yourself as THE professional company that does THE best work. Then do what needs to be done to establish that reputation.
