Being in Business and Surviving the Recession
Years ago I read a quote in an entrepreneur magazine that has stuck with me ever since. It said...."In business you offer either good service, quality product, or low price. To be successful, you must offer two out of the three. If you offer all three, you will go bankrupt." I thought about this concept and realized that it applied to just about every successful business I could think of. Service, product, and price....Fast food businesses offer service and price but not high quality. Upscale retail stores offer service and quality but not low price. A few businesses, ones that are in demand and have little competition, can be successful only offering one out of the three (usually quality), but they are an exception to the rule.
At the time that I read this quote, about 20 years ago, I was on the verge of bankruptcy because I had been trying to offer all three in my contracting business. I made the conscious decision then and there that I would offer quality and service and not try to have the lowest price. It has been frustrating over the years to compete with other contractors who take jobs away from you by convincing the customer that they can offer quality and service at a low price. Usually the customer ends up getting a low quality job, although they may not realize it until a couple of years down the road when the product begins to fail prematurely.
As the economy keeps winding down and money gets tighter, people are looking more at the cost of having a job done. This is forcing many contractors, especially those who operate the way I do using the two factors of quality and service, to rethink how they operate their business. Competition is tuff these days. People are not spending. I suppose many contractors will lower their quality of work in order to compete and survive. I for one will not. I will find another way to make a living if I have to, and I may have to real soon.
History tells us that this recession will turn around, and I'm sure it will. The problem is, how many of us in business can survive doing what we are used to doing without loosing our homes or going bankrupt. For me, neither of those are an option. So the challenge is....How do I keep running my business at a profit without cutting quality or service? It's a question that businesses are asking themselves all over the country. It will be interesting to see what happens in the next couple of years.