Saturday, February 4, 2017

"Money Doesn't Magically Show Up In The Cash Drawer, There Has To Be Sales"

One indisputable aspect of business is that there has to be revenue. Without it there is no business. It might be an interest or a hobby, but it is not a business. For most businesses, revenue is generated through sales. There are some non-profit agencies and governmental entities that generate revenue through grants and gifts, but the argument can be made that a sale was made to create the gift.

Many people who want to start a business never do because they fear or dislike making sales. Others never let their business develop as much as it could because of a dislike for sales. This is unfortunate. Sales are an essential part of being in business. It's that simple. No sales, no revenue.

We might remember back to having a lemonade stand or paper route, babysitting, cutting someone's grass, washing their car, or shoveling the snow when we were younger. It was fun getting the spending money even though the work may have been somewhat hard at the time. One thing was constant. There had to be a sale made first. There are differing degrees of effort involved in making a sale - even in just being available for someone to engage use - but a sale still has to occur.

As we build our aging in place business - whether it's design, space planning, architectural, home assessments, medical equipment, cabinets, appliances, flooring, lighting, hardware, construction, or some other aspect of the project - we must connect with someone who needs or requires a home modification and then prepare a plan for them that they can approve and hire us to do it. It could even be a third party such as an insurance company or rehab center that hires us. Nevertheless, a sale has to be made.

Selling our services takes a lot of thought and planning. Sometimes there is a product involved, sometimes not. If we are doing a physical remodel or renovation, there is a physical end product that the client is purchasing from us. It also includes many physical components, such as all of the building materials, appliances, fixtures, lighting, flooring, hardware, and other treatments.

If we are supplying or installing a lift system, elevator, or some other type of mobility product, there is a tangible sale to be made.

When there is a product involved, we meet or talk with our clients, determine their needs and budget, identify a product or solution to share with them for their approval, get their selection, confirm the sale, receive a deposit or full payment and complete the job. At some point the entire project is paid for by the client or whoever is funding it for the client.

We obtain the products and materials at a wholesale price, full retail, or at a contractor's discount, depending on our role in the process. Then we add our profit and overhead to the price of the goods to arrive at a number we charge our clients. No matter who does the job, the materials are going to be priced similarly. It's the labor and profit that varies between companies and what we need to determine before we start selling.

When we are providing consulting services, there is no tangible product to purchase and then deliver to the client. It is all based on pricing our time and expertise. Thus, there could be a tremendous range between various companies.

There is both a science and an art to pricing our services, but the bottom line is that they need to sold before we receive any money. That needs to happen for us to remain in business. It all starts - and continues - with a sale.

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Steve HoffackerCAPS, CEAC, SHSS, is a licensed Certified Aging-In-Place Specialist-Instructor and best-selling author of universal design books. To learn about this and other programs for aging-in-place or universal design, visit stevehoffacker.com or call 561-685-5555.