Electrical business challenges

[Isetech]

What would you say is the most challenging part of operating a small elctrical business.

No. 1 - When you hit the bottom part of the cycle and you have to remember your morals and standards. It just too easy to "bend the rules" and slip that envelope under the table, sign that document without even visiting a site, or pay for that dream holiday to secure the contract, etc etc etc. This has been the most difficult part, making money is easy, anyone can do it. The more you are prepared to lower your morals and standards, the easier it gets, to a point then, it bites you, beware dont go down this slippery road, it will catch up with you, so if you in for the long haul, dont. If you planning a hit and run, make a quick buck, there are plenty opportunities.

No. 2 - Not spending the deposits paid upfront by customers, why it is never a good idea to pay certain companies large deposits, late November, early December Leave pay and bonuses, come year end, can break you and why its a good idea to take on factory shutdowns or relocation. It has saved my butt a few times.

No. 3 - Buying that nice bakkie you have always wanted, I was guilty of this in the first 10 years of business. When you buy that nice bakkie, you will notice payment take longer and you will hear comments like, "We must be paying you too much"., sad but true.

[Derlyn]

What would you say is the most challenging part of operating a small elctrical business.

No. 1 - When you hit the bottom part of the cycle and you have to remember your morals and standards. It just too easy to "bend the rules" and slip that envelope under the table, sign that document without even visiting a site, or pay for that dream holiday to secure the contract, etc etc etc. This has been the most difficult part, making money is easy, anyone can do it. The more you are prepared to lower your morals and standards, the easier it gets, to a point then, it bites you, beware dont go down this slippery road, it will catch up with you, so if you in for the long haul, dont. If you planning a hit and run, make a quick buck, there are plenty opportunities.

No. 2 - Not spending the deposits paid upfront by customers, why it is never a good idea to pay certain companies large deposits, late November, early December Leave pay and bonuses, come year end, can break you and why its a good idea to take on factory shutdowns or relocation. It has saved my butt a few times.

No. 3 - Buying that nice bakkie you have always wanted, I was guilty of this in the first 10 years of business. When you buy that nice bakkie, you will notice payment take longer and you will hear comments like, "We must be paying you too much"., sad but true.

So true.

When clients haggle about price, I point to my 1999 station wagon and say " if I was charging too much, that would have been a double cab "

[Isetech]

No 4 - staff ... I cut back many years ago and have been pretty much operating hands on with an assistant as required. Unfortunately things have got out of hand in the past year, I just cannot cope with all the work and cant even offer a completion date for current projects, as they just keep growing.

I have been sub contracting work out to others companies in an attempt to ease the work load, but even that is not helping, sub contractors are also too busy or cant assist with the work.

I decided to attempt employing more staff, let me just say it time to join an association. If you employ more than one person, I would strongly advise you join an association and do the documentation by the book.

As you are aware I have been considering ti for a while, not sure who to join, but have a pretty good idea who has long term experience dealing with labour issues and good grounding in the industry.

[Isetech]

No 5 - Managing the company money, if you like me with a trade background, chances are you just as foolish with handling the finances in the company ( I decided to hand over the task to a competent person in that line of work).

I had to register with vat due to the crazy figures we been turning over in the past one and half years, which introduces another challenge, paying it over every 2 months.

A tip, open a saving account and make sure you transfer the full vat amount as the money reflect in the company bank account, trust me you will thank me for this tip when you have to hand it over on the due date.

[Dylboy]

Another challenge I have is being a one man guy, when you on a job and bet a call out from a current customer it's difficult to split yourself up.

Tried getting a spark and a driver but that didn't work due to cash flow.

It's a challenge like being too small but middle ground of wanting and needing to expand but then not enough work to sustain the extra overheads.

It's tough and not yet nailed a solution and causes a huge amount of stress

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[vieome]

1. Market Competition:

Challenge: Facing competition from other electrical businesses, including larger firms and local competitors.
Impact: Staying competitive requires differentiation, effective marketing, and delivering high-quality services.

2. Financial Management:

Challenge: Managing cash flow, handling expenses, and ensuring a steady stream of revenue.
Impact: Financial challenges can lead to difficulties in paying suppliers, employees, and maintaining business operations.

3. Customer Acquisition and Retention:

Challenge: Attracting new clients and retaining existing ones in a competitive market.
Impact: Acquiring and retaining customers is essential for sustained business growth.

4. Regulatory Compliance:

Challenge: Navigating and staying compliant with industry regulations, safety standards, and licensing requirements.
Impact: Non-compliance can result in legal issues, fines, and damage to the business's reputation.

5. Technology and Innovation:

Challenge: Keeping up with technological advancements and innovations in the electrical industry.
Impact: Failure to adopt new technologies can lead to inefficiencies and a loss of competitiveness.

6. Workforce Management:

Challenge: Recruiting, training, and retaining skilled employees.
Impact: Skilled and motivated staff are crucial for delivering high-quality services and maintaining customer satisfaction.

7. Economic Uncertainty:

Challenge: Navigating economic fluctuations and uncertainties that impact construction and maintenance projects.
Impact: Economic downturns can lead to reduced demand for electrical services.

8. Risk Management:

Challenge: Mitigating risks associated with project delays, safety issues, and unforeseen circumstances.
Impact: Inadequate risk management can lead to financial losses and damage to the business's reputation.

9. Marketing and Branding:

Challenge: Effectively marketing the business to stand out in a crowded market.
Impact: Insufficient visibility and brand recognition may result in fewer opportunities.

10. Technological Adoption:

Challenge: Adopting and integrating new technologies into business operations.
Impact: Reluctance to embrace technological advancements can hinder efficiency and competitiveness.

Success in overcoming these challenges often involves strategic planning, effective management practices, staying informed about industry trends, and a commitment to continuous improvement. Each challenge provides an opportunity for growth and innovation when approached with a proactive mindset.

[Isetech]

Chatting to a person the other day made me realize why I dont advertise or brand my vehicle.

Talking to a random person about stuff we were both interested in, secured our next job (which we could start at any point, but should be ready to start by the end of April 2024), a nice little R400- to 500 K project

It has taken a while to build up to this point again, that we have more work than we can manage, a notebook with a long list of projects we can start at any point and literally giving a away work everyday because some customers are not prepared to wait 4- 6 months.

We back to working weekends to try keep up.