If you want to make a beef stew, in addition to beef, you will need potatoes, carrots, celery, onions, seasoning and whatever your particular additives may b If you want to be successful in the PHC business, you will also need the right ingredients, properly apportioned. Here are the ingredients for business success:

Thorough knowledge of your field of expertise 

This is essential. If you are a plumber, you need to know that hot is on the left, cold is on the right and effluent doesn’t flow uphill without a pump. To properly apply this ingredient, you need to know how to properly size the conduits intended to deliver hot water to the left as well as cold water to the right, and effluent to its approved destination.

And since the left is hot water, you also need to know how to properly size the equipment that will make cold water hot so you won’t have cold on the left as well as the right. 

The conduit that allows waste to be properly disposed of needs to be properly sized, pitched, and supported to maintain said pitch. 

If your field is heating, you need to be cognizant of how to determine heat loss. This ensures that the system you install is properly sized and functioning correctly to keep the space you are trying to heat warm in January and not in July.

Air conditioning, like heating, must also be properly sized and functioning so that July is cool and January is not.

You also need to possess comprehensive knowledge of the laws of physics pertaining to plumbing, heating and cooling.

As a PHC contractor in business, the knowledge of your field of expertise must be blended with the next two ingredients.

Business knowledge and acumen 

Business knowledge is the comprehension of specific functions related to business, such as financing, marketing and the simple truth that two plus two can only equal four — never less and never more.

If you don’t have the money on hand to run your business, you need to be able to obtain the financing necessary for your business to exist. Your sweat equity can only take you so far. Putting gas in your vehicles and purchasing materials from your suppliers requires money. 

Attracting consumers to avail themselves of your services requires you to understand that nothing will happen if you don’t advertise.

Once you realize the importance of business knowledge, you must hone your business acumen, which is the ability to comprehend, manage and make decisions that can allow you to succeed. 

Controlling your legitimate business expenses through the use of common sense and the fundamentals of mathematics is vital to your ability to succeed.

I chose the word legitimate to make the point that there is a difference between legitimate business expenses and those that are not. 

For example, a vehicle for a supervisor to visit work sites, check on task progress of techs, interact with consumers and give them options and prices, etc., is a legitimate business expense. Choosing a Rolls-Royce as that vehicle makes the expense, more likely than not to some degree, illegitimate, and it does not allow you to keep business expenses within the realm of reason.

Once you properly identify and calculate your true operational business costs for salaries and salary-related expenses, vehicles and vehicular expenses, insurances, rents, marketing, professional services and a myriad of other items necessary for your business to exist, then and only then will you have the information necessary to properly and profitably arrive at your selling prices. This allows you to succeed by bringing in more money than it costs to run your business.

Now you must add the next vital ingredient. 

Pride in the quality of your work 

If you don’t have pride in your workmanship, consumers will receive mediocrity instead of excellence. When mediocrity prevails, value diminishes. In turn, when value diminishes, so does the opportunity for repeat business from the consumer to whom mediocrity was delivered.

With knowledge of your field of expertise, business knowledge, business acumen and pride in your workmanship addressed, you must add the next ingredient

Delivering excellence 

Excellence starts with pride in your workmanship, blended with the actual delivery of top-quality workmanship. The delivery of excellence requires you to avoid shortcuts in your performance. Excellence also requires you to use top-quality materials. Using materials that can be questionable regarding the level of quality and functionality does not lead to consumer satisfaction and repeat business for you.

Excellence also requires that you stand behind your performance and the functionality of the material you supplied and installed. This part of this vital ingredient gives consumers peace of mind should a problem arise. 

When consumers know you will be there to assure them that they will have no problems related to what you did, you build up your reputation and gain the ability to get repeat work from those consumers. Through their recommendations to others, friends and family can become part of your loyal clientele and help you grow your business. 

The delivery of excellence also gives you the bonus benefit of cutting down on one of the business’s intangible operational expenses: the dreaded callback.

As your business grows, you will more than likely need to hire more employees. When that happens, it’s time for the next ingredient.

Hiring great employees

Hiring people only because you need help can be detrimental to your business. It also probably leads to employing people who are not great because you did not vet them properly.

I only worked for two PHC contractors before entering the PHC business arena with my own company. Tony, the first master plumber I worked for as a novice helper so many years ago, once told me regarding my future in the PHC trades: “There are two types of mechanics. You could be a wanted mechanic or a needed mechanic.” Then, he asked me which one I wanted to be.

After a few seconds of thought, I concluded that the needed mechanics were those who only fill labor positions until the job is done. Wanted mechanics are those who contractors want to keep in their employ at all doable costs because they are more valuable to the contracting business.

When you are at the point of having to hire employees, whether they are technicians or office staff, keep in mind that you should hire those you want rather than just anyone to fill a vacancy. The staff you hire is a reflection of your business in the eyes and minds of consumers. 

That reflection starts at the initial phone call, follows through the performance of services rendered, and continues throughout the life expectancy of the service provided.

After you hire those employees who are truly wanted rather than only needed, you arrive at the need for the next two ingredients.

Training employees and evaluating their performance 

In order for the reflection of your business to be what you want it to be, it is necessary to train employees in your desired procedures and how you want them to implement those procedures. 

By objectively monitoring what employees are supposed to do and what they are actually doing, you will be able to see any problems that may arise and how to rectify those problems, how many accolades to bestow upon deserving employees, the value of each employee to your business, whether an employee is cost-effective regarding the costs of their employment or a drag on your bottom line, and if your clientele is satisfied with your employees and your business as a whole entity.

After you gather all the ingredients mentioned, you’ll just need the final ingredient.

Managing operational costs and selling your services in a profitable manner 

By identifying, calculating and managing your true operational business costs, realizing that you only have three choices regarding your selling prices (to sell at, below, or above your true operational business costs), choosing a profit margin that will allow you to attain your business’ goal (selling above your costs), and keeping your prices as palatable as possible without risking selling below your costs, you will have the opportunity to succeed as long as you have the courage and ability to close each deal.

That’s the recipe. It’s up to you to prepare, initiate and succeed.