Sometimes I see a scenario where a small business owner in the home service industry feels that he or she must maintain good relationships with their local competitors so that they can help each other grow, share trade information, and pass off extra work.  If you want a business that is stagnant or grows only as fast as the market expands, then I guess this is the way to go.  But if your goal is to grow rapidly and to take market share (as your goal should be), then you must learn to be more ruthless.  After all, did you become a contractor to make friends or to make money?

Your competitor is the enemy.  They should be treated as such.  I’m not saying to bad-mouth them or lie about them to potential customers.  I’m not saying to sabotage their business with unscrupulous methods.  I AM saying that the quality of your work, the excellency of your customer service, and the effectiveness of your marketing must all be so overwhelming that they are tools to rocket your business and bury your rivals.  Do you really think they would shed a tear if you went out of business?  They are plotting against you every day, and if they are not then someday their business will die.

We live in a capitalist society, and business is war.  The sooner you can learn to embrace this concept, the better.  By all means, be a nice guy “off the field”.  Character is important.  But when you “step between the lines” that guy in the other jersey is the only obstacle to your ultimate success and domination.  You have a duty to yourself and your employees to crush him, to decimate him, to run up the score on him.  Otherwise your business is an exercise in futility, and your future could be one of uncertainty.  Cut your ties with your competitors.  They are holding you back, or worse yet, they are preparing to take your down while you sleep.

One common mistake that new business owners make is to price their service too low – also known as “lowballing” in the construction and home services industry.  Your motive in doing so might be to generate enough business to keep the business afloat in its early stages, but it’s a flawed strategy that will almost certainly lead to your company’s demise.  Learning how to become a contractor also means dedicating yourself to understanding business fundamentals, and a big part of this is learning to price appropriately.

For one thing, you’ll find that most quality-minded, upper-class homeowners (whom you’d be wise to target most aggressively) view low bids as a warning sign that your company must be cutting corners somewhere in order to stay in business.  In their mind a super-low bid equals crap work and even crappier service.  I must admit that I, too, nearly fell into the lowballing trap in the early days of my business.  I was scrapping for business any way I could get it, and to assure a constant stream of cash my bids started to drift lower and lower.  The middle-class customers hired me consistently at the lower prices, but I was working harder and harder for less and less money per job.

But soon arrived one particularly puzzling day when I gave a low bid for a large job at a huge home, and instead of getting the usual gleeful response of “when can you start?!”, I got a marathon of questions about why my price was so low compared to the competition’s, if I was going to do quality work, and what kinds of references I had to prove my abilities.  It threw me for a loop, and though my newly honed salesman skills eventually won me the job anyway, it opened my eyes to to the fact that I could actually be losing business because my prices were so low!  And I was losing it in the demographic that I most needed: wealthy, time-challenged, highly-networked homeowners.

It is true that many middle-class customers are more concerned with price than anything else, so you have to price competitively to them, but they do not represent the segment of the population that will give you your most profitable jobs.  Focus on targeting higher-end homes, charge what you’re worth, and you’ll wonder why you ever used to be one of the dreaded “lowballers” that works more but makes less.

UPDATE:  Obviously I had not expected it, but in looking at my site stat logs it seems that this post is coming up in some internet search results for those researching suicide.  If you are feeling hopeless or suicidal, please call the National Suicide Prevention Lifeline at 1-800-273-TALK or visit their site at www.Save.org.  Please call them now.  Help is available.

Welcome to 2008!  The beginning of a new year is the perfect time to take a brutally honest look at your life or your business so that you can correct mistakes, refocus on what’s important, and rekindle the passion that may have been lost along the way.  If you feel like your energy for life is worn out, but you aren’t sure why, please take a minute to read this list.  It could make all the difference!  So, without further ado, I give you the Top 10 Ways To Kill Your Spirit:

1. Finally let go of those juvenile notions to have an occupation that you enjoy.  You’ve got to stay at that job that you hate and suppress your desire for a career change because, well, that’s what everybody else does.  After all, you’ve got several more lives after this one to do that thing that you’ve always wanted to do.  No need to have a sense of urgency.
2. Stay committed to that significant other that doesn’t believe in your dreams.  So what that they ridicule you for wanting to become a contractor, or that they call your hobbies a selfish waste of time.  They know you better than anyone else, and therefore know what’s in your best interest.  And who knows, maybe with time those feelings of resentment and bitterness that you harbor will just fade into a mind-numbing, soul-sucking disconnectedness that you so admired about your now-divorced parents’ relationship.
3. Don’t show too much enthusiasm or emotion.  People might think you’re weak.  Worse yet, they might gain a glimpse of the real you, and the real you might make them wish that they were leading more authentic lives.
4. Ignore and suppress the talents you were born with.  Never mind that you were put on this planet with the express purpose of writing that Pulitzer Prize-winning book that would help sway public opinion in such a profound way that it resulted in the election of a President who’s revolutionary ideas would end world hunger and the AIDS epidemic.  You’ve got more important things to do, like spend 40 hours a week, 50 weeks a year, for the next 30 years writing cheese-ball, one-liner greeting cards that will end up in the garbage anyway.
5. Don’t stand up for yourself.  Self-respect is overrated, and your boss is probably right: you are a worthless idiot.
6. Don’t rock the boat.  The way things have always been done is the way things should always be done, period.  Malcontents like George Washington, Thomas Edison, the Wright brothers, and Rosa Parks just made the world more complicated.  Who needs air travel, anyway?
7. Refuse to apologize for mistakes you’ve made.  After all, it was a long time ago and they probably don’t remember, just like you don’t remember that time 39 years ago when your best friend in high school borrowed your car and then wrecked it before skipping town.
8. Refuse to accept apologies because, well, you’ve never made a mistake in your entire life, and holding onto that anger is doing wonders for your blood pressure.
9. Don’t take risks.  Whatever is out there beyond the horizon might hurt or frighten you or, God forbid, allow you to learn something new.  Besides, everybody knows that the greatest, most influential figures in history preferred to play it safe and take the easy bets.
10. Read something like this and tell yourself that idealism is for the young, the naive, and the stupid.                

When my brother and I made it through the process of learning how to become a contractor and then finally started our niche business, most of the people in our lives supported what we were doing (thank goodness), but there were plenty of critics, too, as there always are.  It’s hard enough to convince these types that business ownership is a worthwhile endeavor to begin with.  So when they hear that your business is ultra-specialized it’s just that much more ammunition for them.  The naysayers could be friends, family, former co-workers, you name it.  Listen quietly to their speech and say little, but allow it to fuel the entrepreneurial fire within you.  If you’ve done your research and know that a market exists for your service (especially an emerging one), you must learn to ignore those buzzing flies in your ear.

These days our business is on fire, and suffice it to say that most of the criticism has been silenced.  The key is specific, targeted advertising.  Google Adwords, for example, has been huge for our business.  Internet advertising is still a confusing concept for many contractors and small business owners, but I can almost guarantee that if you give it a chance, you’ll be astounded by the results.  By the way, if you don’t have a website for your business yet, what are you waiting for?  More and more consumers are opting for Google and Yahoo and throwing away their phone books, so it’s high time you developed an internet presence – you won’t regret it!  By leveraging the internet you can score huge numbers of free construction leads.  We also send postcards to upscale homes that are obviously in need of our services, and this has proven to be effective as well.   Be aggressive in targeting those that have a need for your service, even if the concept is a relatively obscure one.

The exciting thing to me is that we’re staking a local claim to an emerging type of service, and the pool of potential clients only grows larger with each passing year!  The critics will never get it, but that’s just fine.  The more numerous the cynics, the fewer the number of potential competitors you’re likely to encounter.  The end result is that you could be positioning your company to be the dominant local player in a niche service that is about to explode.