VIDEO: Coaches Corner with Mike Draper: Getting beyond the "business plateau"

In this video, Rob Koci (Canadian Contractor) talks to our resident contractor coach, Mike Draper (renovantage.com) about getting beyond the “business plateau.”

What is the “plateau”?

It’s the maximum amount of money you can make as a renovator, Mike says, while doing things the way you’ve always done them.

“Every business owner can take their business to a certain level,” Mike says. But getting beyond that level (whether it’s annual billings to clients of $500,000 or $1-million or $2-million), you need to change the way you think about your business. It’s just not possible, beyond that, to work any harder or faster – without adding more skilled help to the business, and without adding some systems to the business.

“(Contractors) reach their knowledge cap,” Mike says. “They’ve done things this way for five or ten years and they need to make a big change to reach the next level.”

Obviously, hiring a site supervisor, for example – if you don’t have one – costs money. And there’s a short-term “hit” in making that investment.

So you need to look at your cash flow forecasts to assure yourself that the extra capacity that you will have (the extra time that you, the owner, will have – to go look for more and better work, for example) will pay off in better cash flow very soon.

“Cash flow forecasting is key,” Mike concludes.