Inflation is beyond our control, but we can adjust to it so our business can survive and thrive. Here are some ways to cope with higher prices of goods as an owner of an asphalt maintenance contracting business and ensure its survival.
What is Inflation?
Simply put, inflation is defined as the increase in the overall prices of goods and services in a particular country. For it to count as inflation, the price increase should be across the board. It doesn't occur in just one or two industries.
Higher prices of goods mean that your purchasing power has declined. You find it increasingly harder to purchase the same amount of sealcoating, crack filling, and line striping supplies as you used to.
Prices on gasoline, wages, and other things you need to keep your business running are also through the roof.
How to Cope with Inflation
1. Adjust your prices accordingly
You hate raising prices (and your customers hate it, too), but this is something you have to do to make sure your sealcoating and crack repair business stays afloat.
How do you make it as hassle-free as possible for yourself, your team, and your customers? Here are some dos and don'ts
- Give everyone in your team the heads up before you roll it out. This is to ensure that they quote customers the correct price for each service and prevent any embarrassing mix-ups in the future.
- Tell your customers about the price increase in advance. There's nothing more annoying for customers than you dumping a price increase on their laps without advance notice. Make sure to tell your customers a month or so in advance so that they, too, can adjust their budgets. Or it can incentivize them to buy at the current price before the increase happens!
- Communicate any price increase clearly and truthfully. Be transparent and tell them the truth about why you have to adjust your prices. Price increases are always painful at the onset, but in our experience, most customers will understand why it has to happen.
- Welcome questions from your customers about the price increase. Keeping your lines open for questions about the new pricing is a great way to establish trust with your customers.
- Do not apologize for raising your prices. Instead, make it clear to your customers that you're doing this to maintain or improve the quality of the materials you are using and your services.
- Don't raise prices across the board as the prices of some asphalt maintenance supplies and equipment remained stable this year.
- Don't be disheartened if you lose customers. Losing customers is always painful – doubly so if you lost them because of a price increase.
But as we always say, asphalt is everywhere and you'll never run out of customers as long as you and your crew are ready to put in the hard work to find them. Do go after more lucrative projects instead so you can recoup your losses ASAP.
2. Cut out unnecessary expenses
Economic crises are never a good thing. But on the upside, they force us to look at our budgets, reevaluate them if they are bloated, and trim them if necessary to ensure that our businesses stay afloat.
So here are some actionable ways to cut expenses for your asphalt maintenance business.
- Hold conferences online and attend only the most necessary trade shows or in-person conferences.
- Reduce paperwork to save money. Switch most of your documentation online, including invoicing, proposal creation, and correspondence. If you need to create proposals, do it in software like AK Dash instead.
- Print documents that you absolutely have to and leave only one printer in the office to discourage your staff from printing unnecessary documents.
- Let go of underperforming staff and outsource tasks if necessary.
- Pay off all credit card balances, interest charges, and other fees.
- Get rid of office or warehouse space you don't really need. You and your crew are out on the field most of the time anyway, so you might want to move your admin staff to a smaller office that fits your needs and your budget.
- Reduce your energy consumption and cost.
3. Save on gas
The price of fuel skyrocketed over the past few months and the asphalt maintenance industry is feeling the brunt. As a contractor, you want to save as much as possible when it comes to car fuel. So here's what you can do.
- Plan your routes properly and use a calendar app to organize your schedule.
- Save fuel while driving by easing off the accelerator and going easy on the brakes.
- Summer's sweltering, but don't blast the air conditioner on too high.
- Have your vehicle checked and maintained regularly.
- Cold call over the telephone or online. Driving around and knocking on doors to pitch your services is just not practical right now.
- Never overload your vehicle.
- Use regular or mid-grade gas instead of loading up on pricier premium fuel. Just make sure to use the motor oil recommended by your vehicle's manufacturer.
- Set aside some time to compare gas prices online. You can also use an app for price comparison.
- If you have a gas guzzler, then it's time to switch to a more fuel-efficient one.
4. Talk to your suppliers to get the best prices on materials and equipment
Nothing makes us happier than helping asphalt maintenance contractors thrive in these interesting times.
We can help you explore different options to save money on supplies and equipment, as well as alert you on the best deals. We can also advise you on which products you need to stock up and when's the perfect time for you to do that.
Financing is also available to help you buy the equipment and supplies you need now, while paying for it over time with affordable, easy-to-manage payments.
5. Invest in high-quality asphalt equipment
You can save a little bit of money when you buy cheap sealcoating or crack filling equipment.
But they are often so poorly made that they break down easily and would cost you more in maintenance fees in the long run. Worse, you need to replace them within a few years or so, making them a very poor investment choice.
Invest in high-quality equipment instead. The best sealcoat sprayers and crack filling equipment can boost your efficiency, resulting in fewer downtimes and allowing you to service more driveways and parking lots than before.
High-quality equipment, when used correctly, also do not break down frequently and have a longer lifespan compared to cheaper pieces of equipment. Plus, they have superior warranties so you can save money even when it does break down.
Inflation is here and it looks like the end is not yet in sight. But that doesn't mean there's nothing you can do about it. With these actionable tips, you can make sure your asphalt maintenance business not only stays afloat but also weathers the storm.