Finding Those Hidden Costs in Your Home Service Business
About this episode
Some of the biggest drains on your profit don’t look big at all. An untracked material run here, a skipped oil change there, an extra crew member with nothing to do, a subscription nobody uses. On their own they seem minor, but together they can quietly cost a home service business hundreds or even thousands of dollars every month.
In this episode, Kerry walks through four hidden costs to hunt down in your business and how to put systems in place to stop them, so you can boost profit without needing a single extra sale.
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Key takeaways from this episode
- Track every material that goes to a job, including last-minute store runs.
- Preventive maintenance on vehicles and equipment costs less than breakdowns and downtime.
- Send the right number of people to each job so every paid hour is productive.
- Review your dues and subscriptions at least quarterly and turn off auto-renewals you don’t need.
- Cutting hidden costs increases profit without needing more revenue.
Show notes
Why hidden costs matter
Continuing the profitability series, Kerry explains how small, overlooked costs add up over time and can have a huge impact on your bottom line, and how fixing them puts profit back in your business without increasing sales.
Untracked material costs
Last-minute materials that never make it into the job cost, underestimated quantities and extra trips to the home improvement store all eat into profit, plus the fuel, truck wear and lost crew time that come with them. Kerry suggests putting a system in place and asking your crews how to avoid these trips.
Vehicle and equipment maintenance
Skipping maintenance to save money often leads to bigger repair bills, crews stuck at the roadside and unhappy customers. A simple maintenance schedule, tracked in a spreadsheet or app, keeps you a step ahead.
Unbilled hours and unnecessary labor
Plan each job by stage so you know how many people you need on which days. Every hour you pay for should be productive, so don’t send extra people just for the sake of it.
Dues and subscriptions
Kerry shares how one client doing about half a million dollars a year saved $400 a month just by reviewing her subscriptions. Review them every quarter, downgrade where you can, and cancel what you no longer use.