The One About Opportunities Or Distractions In Your Contracting Business #37

October 2, 2014

Today’s contractor marketing podcast is brought to you by Dave Negri and Justin Jones. This is a deep dive into whether a new idea is an opportunity or distraction for your contracting business.

OPPERTUNITYor-distractioncontractor-marketing36-300x258The One About Opportunities Or Distractions In Your Contracting Business #37There are two types of shiny objects that pop up in your contracting business pretty regularly, opportunities and distractions.

The key is to being able to determine whether something is a distraction is to look at whether it will actually fit into your marketing goals, your target market, age group, income demographic and other criteria that determine who you are marketing to and working with!

Dave’s Story

Dave got a call from a fellow who needed a coating system put on his basement in Florida. Now, for much of the country a basement is a given, but houses in Florida with basements are one in 1,000 (maybe). So Dave went out and took a look at the basement, spending 8-9 hours researching everything, going over the space, the products that were available to do the job and what the customer wanted. It would be fun to try something new, to maybe learn a new skill. At the end of Dave’s research phase, the customer said that there was one company who did this for $10,000 out of Orlando and Dave came to his senses.

While it would have been a great payday, there were many different clues that this would just be a distraction. First off, there are not that many basements in Florida so it is not something that he will have a huge call for. Secondly, if the sealer didn’t work, he would have to come out and re-do the work again. Lastly, he would have to rent all the equipment and had no systems in place to help his guys do a good job.

Dave happily walked away from this distraction.

Justin’s Story

Justin’s story starts much the same way as Dave’s. A referral call came out of the blue, a Realtor wanted to know if he could come out and take a look a house in Old Northeast, St. Petersburg Florida. This time they wanted to know if he could do structural repairs on an older home. The money was pretty good and the timeline was about two days, so Justin was seriously considering it.

Then the Realtor said that there was only one company in the area who did this kind of work and they were across the bay in Tampa. This could have gone distraction except for two things.

First off, Justin had done structural work before and was familiar with the ins and outs of how to fix these types of homes. Secondly he had a wide range of these houses in a close geographic area to where he already worked. There is a rather large area with homes built in the early 1900’s to 1940 who were all experiencing the same kind of structural problems.

He agreed to match the cost of the other company for the first job and the rest is history! Justin now has a business based on this extremely profitable, duplicatable opportunity with a very easy to market to demographic target.

Distraction or Opportunity

Because most contractors are entrepreneurial, they are more than willing to check out a new product or service that they think might add to their bottom line. The main key is to figure out early on whether that new product or service is a distraction or an opportunity.

Both Dave and Justin have tried to add a product to their businesses that was not exactly a right fit. Justin has a coating that would extend the roof warranty on commercial buildings for 20 years and Dave has a product he is using right now which is GREAT but which there is no knowledge about in the marketplace.

For both of them, the cost to bring this product to market was pretty high. They had to buy new equipment, stock a new product, train their workers and market it to their current and new customers.

In both of these cases the new product actually turned out to be a distraction that took their eye off of the main target of their core contracting business.

Are You Adding To?

One key point in all of this is to recognize that “add to” also means that you have to “subtract from”. Adding these products meant that they had to subtract money to get them up and running, time for training and doing work that was not a core part of their main work.

That said, there are times when there is a clear “add to” with no subtraction. A plumber who adds a toilet replacement to a leaky faucet fix is doing a well thought out upsell (opportunity) rather than falling prey to a distraction that is outside of the scope of his regular work.

Good Money After Bad

There is a saying in the business world, fail fast. That is super important when you figure out you are chasing a distraction instead of an opportunity. Instead of blindly keep going forward, stop and really assess to see if this is something that will increase your profits.

Once you have spent any money there is a tendency to want to keep going to make it back. That just makes the old saying, “throwing good money after bad” come true. If you figure out you are on the wrong path, get off the path!

Niching Down Your Contracting Business

There is a real benefit to keeping a focus on your core contracting business. If you pick an opportunity over a distraction you can increase your profit margins by being able to scale up more customers.

A great example of this is Dave’s policy of only painting “little” houses. His profit margin is the same on all houses, but if he is doing a million dollar mansion where he has to spend all his time, he is missing opportunities to get more of the smaller homes which are completed at a much faster rate (and which result in more happy customers and more referrals). In fact he spent almost a year painting the inside of a giant home, feeling at the end that he was “living there”. When the next door neighbor approached him to paint his house, Dave politely declined and has stuck to his little houses ever since.

Knowing this is his “sweet spot” he is able to market to a highly targeted geographic area where there are a large number of the types of homes that he works on (and which are close to his home base, meaning less travel time and more profit).

Justin was able to scale his business by taking over the structural jobs in the targeted geographic area. Instead of taking 8 months and his whole crew force to build two houses, he is now able to split his crews and complete jobs in two days, working for profit margins that are 10 to 20x higher than he can make building houses!


Not every opportunity is a distraction, but it is really important to make sure that you are assessing whether a great new idea is something that will add to your contracting business (and bottom line!)

One idea is to make a list everyday of things you want/have to do. Next to each item put a D for Distraction or a O for opportunity. Doing 5 really important tasks a day means that you will be doing 25 a week and 100 a month. Adding up all these targeted tasks over a month will get you to your idea business faster than anything else you do for your business!

Work your plan instead of it working you. By doing this you won’t spend all your time in crisis management. Track 5 things a week to get you to your goal! Compare your budgets to your goal. By having this laser focus, next month you can do the same marketing, same people, same productivity and then shave 10% of your time or expenses and exponentially grow your contracting business!

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