The economic downturn of 2007-2008 is finally showing signs of receding. Before the momentum picks up, you might want to reflect on the lessons learned and begin to rethink risks and strategies for the next up-cycle. It’s time to diversify. Here are a few suggestions:
If your business is devoted to only You could add additional products to your service line For example, if you fix refrigerators you could branch out into dehumidifiers, ice machines, air conditioners and wine coolers. All these appliance operate on the same theory, i.e.; they all have compressors, condensers, and evaporators, and in most cases, use the same refrigerant.
Having gone through a number of recessions in my 47 year history as an appliance repair technician, I wasn’t worried that much because recessions are usually banner years for repair people. As a matter of fact, 2008 was the best year I ever had up to that point. But I decided to diversify anyway. So I expanded into the wine cooler business and the results were impressive. Here is a breakdown of my profits for wine cooler jobs:
2009, 37 calls ($10885), 2010, 25 calls ($8985), 2011, 42 calls ($14562), 2012, 49 calls ($22407. All this without spending a dime on advertising. I just added service for wine coolers to my website.
But before you branch out and consider expansion plans, do your due diligence. Spend some time on research, talk to other business owners or if you have employees ask for their input. In most cases you may need additional training or skills. Don’t rush in–tread slowly.
Sell services or accessories that complement your area of expertise, such as installing water filters for ice makers or overflow alarms for clothes washers and dishwashers. If you have a shop, you could offer drop-off service. If you’re a dealer you could take trade-ins, refurbish the old units and sell them on ebay or Craig’s List.
Knowledge is power. How often have I encountered inexperienced repairmen that walked away from a potentially profitable job because they didn’t know what to do or lacked sufficient training or worse, condemn the appliance to the grave yard.
When I started out as an appliance technician in 1966, I was trained on-the-job. I knew nothing about appliances but I was mechanically inclined and understood how things worked. After three months of OJT with an experienced technician, I thought I was ready. But I wasn’t, and for a few of years I remember calling my boss everyday for assistance on a technical matter. It was frustrating to say the least. I approached my employer about attending trade school, but he discouraged me and said the only thing I would learn in school was how to rebuild a pump. He was wrong! In trade school, I learned the fundamentals of physics and basic electricity. I learned how to wire a house, read schematics, install central air, and service commercial and industrial refrigeration. Since then, I’ve added hundreds of thousands of dollars to my gross income from what I learned in school, so if anyone discourages you about additional training, run for the hills.
Another area worth considering is adapting to market conditions. Being smart and hardworking are great qualities for a business owner and most of the business owners I know are both, but because most of them are busy, if not inundated in work, they often miss opportunities when it come to identifying and adapting to change.
I realize that there are plenty of business owners out there who detest change–some for good reason. However, there are also plenty of owners who I’m sure would embrace change if they knew it would enhance their business.
In closing, seek out other successful business owners and learn from them what makes them unique. Join a trade association. Stay abreast of what’s going on in the industry. Subscribe to industry newsletters. If you make it your business to seek improvement, you’ll tune in to that mind set and change won’t be so daunting.