Sunday, December 16, 2012


Have you ever made a presentation where you "just knew" that you were going to get that account? Your proposal presentation went excellent, all the buying signs from the prospect were there and you left confident that you would be selected to perform the service or at least as confident as you can be in today's business climate.

Then you really get pumped up when the prospect calls and gives you a glowing report on how professional your proposal looked, how great your presentation was and then they proceed to explain that you came in second. You ask the obligatory question of why you were not chosen and they explain that your competitor was a few dollars less per month and they felt obligated to their stockholders etc. to be good stewards of their money and select the lower price. Sometimes they will even tell you the amount you were "too high" and of course your natural reaction is we could have done it for that. I've learned, as have you, that in the real world, second place doesn't pay anything. In professional sports the second, third, and maybe fourth place finishers get some payment, but not in the world you and I live in. 

My question to all BSC's is, do you really know what it costs you to perform an hour of work? Many contractors will use industry averages or some form of estimate for their costs. For example, if you are paying $10 per hour for a technician, do you really know what your loaded cost per hour is or do you say it's about 15% or 20% etc. Let's see, 

One hour of labor---$10.00

State Unemployment tax--Varies by state and dependent on your history.
Federal Unemployment tax-.80%
Workers Compensation Insurance--Varies by state and also dependent on your history
General Liability Insurance--Also varies by state

In addition, the Federal and State unemployment taxes are on the first "x'" dollars of an employees wages each year. Once you get over that amount, you don't have that cost to load in anymore.

Some states have special assessment taxes to help compensate for the high unemployment rate over the past few years. The regular state unemployment rate can be one half percent up to several percentage points. The workers compensation rate is also dependent on your safety record and number of accidents etc. 

Do you know the rates in your state? You can control many of these rates and by doing so can be much more competitive when the need arises. You see, an hour of loaded labor might cost you $11.00 and then again it may cost you $13.00. What is your exact rate? About the only rates mentioned above that you can't control is the FICA and Federal Unemployment tax. The rest depend on the effective or lack of effective management of your business. 

The issue is basically the same with material costs. Many companies just use a pecent like 5% and then make that their proposal price. What is your real cost? Is there something in the proposal you are presenting that would cause material costs to be less or more. What about equipment? Will you have to buy new or will you be able to use equipment that has already been depreciated which gives you an opportunity to reduce your costs on this particular job. 

I recall a contract we secured several years ago for $24,000 per month when all of our competitors were at $30,000 or above. We were laughed at but we had done a very thorough job of making sure our labor, supply, and equipment costs were very accurate. In addition, we did a detailed workloading of the facility and then priced out each floor for our own budget purposes. The interesting thing was that we ran that account at 48% labor and then later added 2 day porters at a very handsome profit. Our competitors never had the opportunity to say "we told you so". Now that I have bragged about our expertise, I will also tell you we missed a couple down through the years.

Many times I hear from contractors that they weren't successful on a proposal and that their competitor priced it so cheap that they won't be able to do it for that. Are you sure? Maybe that contractor did price it too cheap but could it also be that he or she knew their exact costs of doing business and will make a reasonable profit at their price---maybe even more than you would have made at your price because they had a better understanding of their costs? I don't know the answer to that question but I hope you will be motivated to check and double check your costs so that as you price your proposals in the future you will know you gave the prospect your best shot. With the new year right around the corner, there will never be a better time than right now to make sure you know what you costs of doing business really are. Try to avoid those "you came in second calls". 

This year is just about history and I hope you have received some benefit from our weekly writings. Let us know what you think--if they have been helpful  or not. We want them to be worth our time to create and your time to read and act upon. We are so pleased with the number of readers we have each week in so many different countries and we want to know what you want to hear about. 

Till next time.


Thursday, December 13, 2012


A few years ago I was conducting an all day supervisor's training workshop in a large southern U.S. city. One of the key exercises we do in our workshops is one entitled--BUILD THE PERFECT SUPERVISOR. 

In that exercise we have the participants list all of the traits they think a great supervisor needs to have in order to succeed in their career and be perfect, if you will. As each roundtable group gives me their list I put them on a large sheet of paper which we then hang on the wall. It's a fun exercise that gets the whole room involved and more importantly, gets them thinking about their position and do they have the traits to be a strong. positive supervisor. 

In this particular exercise we had probably 5 or 6 pages filled and placed on the wall with traits such as,

--Technical knowledge
--Positive attitude
--Understands the company policies and procedures
--Safety conscious
--Does paperwork on time
--Understands discipline procedures
--Knows what to do in case of injury
--Has good customer interaction skills
--Good trainer
--Good planner
--Handles emergencies effectively
--And many more

We were just about ready to complete this portion of the exercise when an elderly gentleman in the back of the room stood up and asked if he could mention a couple of important traits that had not yet been listed. In fact, he said, if a supervisor doesn't have two important traits, the rest of the traits don't matter. And the two traits?----



He went on to tell us that if the person he has representing his company in front of the customers and employees doesn't possess these two traits, it really doesn't matter how much of a shining star the supervisor is. The supervisor is the one person who represents the company and if you can't trust him or her to be honest in all of their dealings with everyone they are in contact with, you don't need them on your payroll. THEY WILL DESTROY YOUR COMPANY if they are not honest was his major theme as he continued. 

In addition, every supervisor should be one of high integrity. He proceeded to explain that integrity is something you have when no one is watching. I learned later that both of these traits had been lacking at one time with the people he had in charge of his operations.

Stop and think about it. It's true isn't it? Don't we want people representing our organizations that are honest in ALL their dealings with employees and customers? We also need to have them have the highest integity as they carry forward with our company name and do daily business as representatives of our company. 

I talked with this gentlemen after the session and found out he was 72 years old and had been taken advantage of by some of his family members who he had turned the business over to run on his behalf when he had reached 60. The idea was to provide them a company and provide him a retirement income. Unfortunately for him, they sucked the company dry and then gave it back to him when he was 70 and now he was having to build the company back up so he had something to eventually sell, but more importantly, he needed the company to put food on his table each day. This man really was an expert on what honesty and integrity meant. He lived through an ordeal of dishonest and immoral family members so he could speak from actual experience. While the gentleman had been taken advantage of, he was very optimistic of building his company back to its glory days. Not sure how many people I know would embrace the same attiude this gentleman had. 

What about you? What traits do you look for in a supervisor for your company? Let me suggest you conduct this exercise with your key people and see what the answers are. You learn a lot about the people representing your organization. Hopefully honesty and integrity will be two of the first words put on the paper as you list the traits your staff thinks are the important ones. If you don't have a staff of several supervisors, do the exercise with yourself. It's a great thinking exercise and will help you later as you begin interviewing for supervisors. 

This year is rapidly coming to a close and I hope it has been a good one for you. Hopefully some of our blog subjects have been helpful. Let us know what you think about the blogs and we want to wish you the very best for 2013. We have a couple of more writings to bring you in 2012 to close out our first year of weekly musings. 

Till next time.


Wednesday, December 5, 2012


Back in 1988, in the midst of the only year I lost money in my BSC business, I decided to attend a 4 hour seminar conducted by Zig Ziglar. I thought, what can a man talk about for four hours? Boy did I find out. This native of Yazoo City, Mississippi had plenty to say. He held the room of 400+ spellbound with his formula for success and more. 

I left there and purchased the Zig Ziglar See You at the Top/Strategies for Success program with the idea of making it a part of our management training program. My wife and I went to Dallas, spent a week learning how to teach the program, and came home excited as "certified trainers" of the course. 

We did indeed make it part of our management training. The 15 week 3 hour per session training classes became an integral part of our staff's professional growth and development. I watched as class participants had tears running down their cheeks as they told of how the course had transformed their lives and made them better parents and spouses as well as better managers for our company. I would be lieing if I told you there weren't a few tears rolling down my cheeks as well as I listened to their stories. What a profound difference Zig made in our lives. 

No one human has influenced my life more than Zig Ziglar. If you have read some of my work or attended any of my workshops or convention presentations you will no doubt know that every session generally has a Zigism or two incorporated into it. I can't help it, he has been that much of an influence. 

Zig Ziglar died last week at the age of 86 still influencing people's lives and encouraging them to follow the path to success. I want to spend the rest of this blog listing some of my favorite Zig sayings. I want to encourage you to read each of them carefully and see how they apply to your life and then follow his advice. I assure you it will be well worth you time and effort. 

Starting with what was probably his signature saying,

+++++You can have everything in life you want, if you will just help enough other people get what they want. 

+++++Your business is never really good or bad "out there". Your business is either good or bad between your own two ears.

+++++The real opportunity for success lies within the person and not in the job.

+++++It is easy to get to the top after you get through the crowd at the bottom.

+++++If we don't start, it's certain we can't arrive.

+++++Obviously, there is little you can learn from doing nothing.

+++++Obstacles are the things we see when we take our eyes off our goals.

+++++Lack of direction, not lack of time, is the problem. We all have twenty-four hour days. 

+++++Remember, you can earn more money, but when time is spent it is gone forever.

+++++The chief cause of failure and unhappiness is trading what you want most for what you want now. 

+++++If people like you they'll listen to you, but if they trust you they will do business with you. 

+++++Ability can take you to the top, but it takes character to keep you there. 

+++++When we do more than we are paid to do, eventually we will be paid more for what we do. 

+++++Some people find fault like there is a reward for it.

+++++The price of success is much lower than the price of failure.

+++++Remember there is plenty of room at the top--but not enough to sit down. 

+++++You don't "pay the price " for success--you enjoy the benefits of success.

And I could go on and on. Which ones are your favorites? It's hard to choose, isn't it? 

Rest in peace Zig Ziglar, you transformed a lot of lives and your work will continue to transform many more. The angels are rejoicing now to have you among them. 

Till next time.