Turn up the 7 dials that drive your profit!

Andy
Ooh, that is a big call, but I definitely agree. So without further ado, drum roll please. Today’s topic is the 7 Dials to Drive Profits. Woo woo .

Ange
Well, we’re definitely the only ones excited right now because the name 7 Dials means absolutely nothing to you guys. But stick with us because it will be worth your while.

Andy
I think our listeners know by now we’re a little loopy anyway, don’t you think? ?

Ange
Yeah. Well for good reason.

Andy
Exactly. So go on Ange tell us what it is, the 7 Dials to Drive Profit.

Ange
Well, I’m glad you asked . So, the 7 Dials is a formula that represents a process within your trade business. Its sole purpose is to improve performance and remove the guesswork within your business. And ultimately it will guarantee to drive profit margins up.

Andy
Music to my ears, baby. Drive Profit Up. Yes. It’s what every trade business owner wants. You’ve got my attention, so just keep going.

Ange
Yes. So the problem with most trade business owners is that they are way too close to their business when they’re working on their tools to see if they can be even more profitable. And hence they don’t elevate themselves to look at their business from a different perspective.

Andy
Did you say on their tools or on their tools? , is it on their tools?

Ange
Did I?

Andy
And maybe I’ve just got a weird sense of humor, , but anyway. Correct. You don’t know what you don’t know, right?

Ange
Right. , like what are you even looking at if you get that perspective?

Andy
The 1 million dollar question Ange every tradie would be super rich if they had the answer to that.

Ange
Well, they’re about to know the answer. Right. And the quick response is data is king.

Andy
Yes. Data is king. Absolutely. But you might need to explain that a little bit better to our listeners.

Ange
Okay, sure. So let’s start from the top.

Andy
Yep.

Ange
In speaking with trade business owners for years, they often say to me, Ange , I just want more customers and I want more turnover, but to be honest, there is often very little conversation around profit. And I say that respectfully.

Andy
No, don’t say it respectfully. It’s a hundred percent true. And if you are out there with a big turnover and no profit at all, that does not impress me.

Ange
No. Turnover is vanity.

Andy
That’s right.

Ange
And profit is what we call sanity.

Andy
Exactly, and at the end of the day, I don’t care if you are a one man show or you’ve got 50 staff, it’s about how much net profit at the end of the financial year that you have. That impresses me.

Ange
Yes. But the reality is getting more customers and more turnover is actually made up of a few different components.

Andy
It definitely is. Keep going.

Ange
So let’s look at customers first and specifically in relation to the 7 Dials customers or how we actually acquire more customers or grow that number is made up of the first four dials, meaning to increase customers, you need four components working together. They are leads, conversion of those leads, quotes, conversion of those quotes, and those together will increase the number of customers you work with. Following?

Andy
Yeah, it sounds super simple, but let’s look at these one at a time. Starting with the first dial being leads. This language is very particular because leads are just that leads, they’re not appointments, they’re not quotes, they’re not jobs. They’re simply a customer calling you or making contact with your business, basically sounding you out to see if you are a good fit for them.

Ange
Yeah, exactly. And when you’ve spent thousands and thousands of dollars on marketing, you are going to wanna answer the phone.

Andy
I hear you say it all the time. You can make or break a sale the moment you say hello.

Ange
Yes, I do say it all the time because it is so true. It is, and it sounds so simple, but it’s really easy to get complacent as the years go by when you own your own trade business and instead of being excited that the phone is ringing, instead you actually just get really frustrated.

Andy
Yep. Over the years, guilty as charged. Yeah. I know. I’ve done it in the past. The phone has rung like the 20th time in 30 minutes, and I simply can’t get anything done. And my first reaction is, Ooooooh!

Ange
Yeah, and that’s the problem right there.

Andy
Yeah. Yep. I agree.

Ange
So the caller is impatient and really quick to judge. So if you take too long to answer the phone or you answer in this monotone voice and they can’t, they can actually hear that you’re really frustrated that they’ve even called. Then you’ve lost the sale already.

Andy
Deck Dong. That is unrecoverable.

Ange
Yeah, and, and that’s why we need to talk about the second dial of the seven dials to drive profit, which is about lead conversion, which means the percentage of leads or calls that you’ve converted to an appointment. Basically the person on the end of the phone saying yes to you, coming on site. For some that could mean doing the job straight away. Think of some maintenance tradies who are in regional towns and charged by the hour. But for most of us, this is your chance to quote.

Andy
Yeah, it’s interesting. It’s a numbers game, really like when you know how many potential customers you could have converted to an appointment on site, then connect this with the opportunity of profitable jobs. Have you missed opportunities already today?

Ange
Yeah, it’s a great question. Mm-hmm. , why aren’t we more excited and enthusiastic about answering the phone the right way and getting the caller to say yes to you coming on site every single time.

Andy
And you’re a hundred percent right. It’s so easy to be complacent as the years go, buying business. But you know what? These little things, they make a massive difference to your business.

Ange
Yes, it’s all about the little things. So let’s get back to the $7 to drive profit. We haven’t even increased customers yet because you have only now arrived on site to perhaps complete the work, but most tradies, as I said, are here to actually quote. So this is the third dial of the $7 drive profit. This is your chance to quote correctly. And then the fourth dial is to convert these quotes to a paying job.

Andy
Right. That’s it. Interestingly, I would say there are lots of trade business owners out there right now saying they need more work and hence are freaking out about marketing when in actual fact they have money sitting on the table with unconverted quotes. Yes. Right in front of them.

Ange
Yeah, a hundred percent.

Andy
So let me ask you listeners right now, a question. How many quotes have you got outstanding at the moment, and how much does that actually equate to? Yeah, like it’ll be big big bucks. I think you’d be really surprised, but I did this with someone recently and it was about $200,000 and

Ange
Wow.

Andy
That was like half of their turnover, so it was absolutely huge, and they just don’t do enough with it.

Ange
I think you’d be surprised at how much work you could have if only these customers said yes to work.

Andy
And this is what we do at Lifestyle Tradie. A lot of people come to us and say, we need more work. And I go, so what are we gonna do for marketing? And the first thing I say is, don’t spend any money on marketing. Let’s look and find the nuggets of gold in your business that you don’t have to spend money on marketing.

Ange
Correct.

Andy
And a lot of the time we can get an extra 30% out of a business, just with what they’re doing already, without spending mega bucks on Google AdWords and all this other crap. Yes. That, yes, it brings in work, but it costs so much money.

Ange
They’ve forgotten the basic fundamentals of business, which is what the 7 Dials does, right? Profit is all about the bank. And you know what? I have had some of our members go, God, Ange this stuff is just so boring. And I go, yes, but boring makes you profit. So let’s just deal with the boring stuff because it’s statistics. And the only reason why you’ve told me it’s boring is because you hate finance.

Andy
When that money’s in your bank account, I guarantee you it’s not boring.

Ange
No . That’s right. So when we start talking about quotes, cuz I agree with you Andy, there’s so much money left inside a business sitting on the table. That they just have not actually focused on at all. But to convert the quotes you need to actually have built trust along the way. You need to build rapport and quote it as quickly as possible, building in value so that they’re not just comparing your price and then making sure you’ve stayed in contact until they make a decision.

All things we teach in detail to our members at Lifestyle Tradie cuz it’s so important how you show up, what you say and hence what you provide as a quote to assist in this conversion process. All you want is a customer at this time to say, yes, you can come on site. And yes, the quote you’ve just given to me, I’ve said yes to you coming on site now to complete the job. That’s what you want.

Andy
That’s exactly what you want. And then, the problem is, and it’s a bit sad sometimes you, your team members, your staff just sometimes don’t understand the impact they have in the process of a quote conversion. Yeah. Like they can seriously bring in so much extra money just by these small tweaks.

Ange
Yes. That part to me is actually really scary. Right? Mm-hmm. , only then have you increased the number of customers that you work with.

Andy
Yes, you’ve gotta watch these numbers like a hawk every day, and increasing the conversion of both leads and quotes will make an absolutely huge difference in your business.

Ange
Yes, it will. You’ve got that one in one. Yeah. So tracking this data day in and day out and just making improvements along the way is what’s important. What we’re aiming for is what I call business excellence, and this will put you on the right path to increasing revenue. But most importantly, profit, this is the topic we’re talking about.

Andy
So the key to this, of course, is that you’ve built your quote the right way with the right margins, and you’ve got the correct timing and the right hourly rate.

Ange
Yes.

Andy
So we’ve answered how to increase customers. What about looking at increasing turnover?

Ange
Okay, so again, we’re talking about the formula. So for the record, increasing turnover for turnover sake is not the answer to a successful trade business.

Andy
You can say that again. Often a benchmark that trade business owners aspire to a lot of the times is all about more turnover, more revenue. But as we know, that’s not right.

Ange
No, that’s not the measurement of success. It needs to be about profit.

Andy
Definitely about profit.

Ange
So that said, there are ways to increase profit, which in due course increases revenue simply because there is more work.

Andy
Okay, I’m listening now. Let’s go. I love profit.

Ange
Yes. So in essence of the subject of the 7 Dials to Drive Profit mm-hmm. The Fifth and the Six Dials relate to an increase of turnover or what could be talked about of course, is revenue. Same, same. Where there are two dials, one increasing average dollar sale and the other is increasing transactions. So let’s talk each one through.

Andy
Okay. I’m gonna take over the increase of average dollar sales. It’s really important that on every job you do, yes, I’m talking about every single job. You actually use specific strategies to help the customer realize there is additional work on their premises that is required. It’s not about getting them to do things in their house that aren’t necessary. What I’m talking about is a way to empower them to make decisions based on preventative maintenance around their property. That, but really needs to be done like changing a TPR valve. Anode on a hot water heater or there’s a few taps leaking, but generally finding other things within their home to increase the average dollar sale.

Ange
That’s right. So focusing on increasing average dollar sales ensures that each customer spends more in that one single visit profitably to you as a business. That’s the point.

Andy
That’s right. And then the second focus is to encourage them to come back.

Ange
Exactly.

Andy
Time and time again.

Ange
Exactly, and this is the one area where we see most trade business owners fail.

Andy
Yeah, I agree. It’s amazing how many business owners would work with a customer and they go, right, that’s it. Time to find new customers. And I’m like, whoa, whoa, whoa, whoa, whoa. You spend so much money attracting customers. To drive them to begin with you and into your funnel. But getting a current customer to come back is way cheaper than trying to find another new customer.

Ange
Yeah, and it’s far easier too. So there are so many different strategies that can be applied to encourage a customer to use you again, especially if you are a service-based business like plumbing, electrical, or pest control, for example. And we know for a fact that when they come back, their average dollar sale is three times higher. That’s crazy. Right? But that’s what happens when a customer now trusts you and they actually start using you for life.

Andy
Yeah. And that’s a statistic that we have through our old business now, but Dr. Drip, and that was when we went back to a customer where we got three times the average dollar sale. Why? Because they knew our process. They knew who we were and the trust was there, and then they were willing to spend the money. And you gotta make sure you keep in touch with them as well.

Ange
Exactly. So staying in touch is the key that covers the first six of the seven dials to drive profit. And both, again, are a numbers game. When your team is taught a process or a system to follow, and when they understand the impact that they have by following it to the letter with every customer. Every time it’s an absolute game changer. Yeah. Because it means profit for the business, because it means a better experience for the customer, because it means that they, the team can benefit from money and the business to purchase better quality equipment, improve the work environment, increase their wages, and just better benefits overall.

Andy
How can you argue with that?

Ange
Well, there you are. That’s why this formula, the $7 to drive profit, is so powerful for any trade business.

Andy
For those still listening, you guys are the lucky ones to hear us talk about this in so much detail.

Ange
Yes. The devil is absolutely in the details.

Andy
It is in the details. There is one last dial though. Ange on the seven dials to drive profit. Let’s hit that one.

Ange
Okay. So as I mentioned earlier, more customers and more turnover are great aspirations, although now you know how to achieve them, right? They’re made of different components, which were the first six dials of the seven dials. So the ultimate goal for any trade business should be about increasing profit. Yes. Profit margins. Right? So the last dial is exactly. How to drive up the profit margins in your trade business, and specifically what you do to squeeze both gross profit and net profit margins.

Andy
Now you’re talking.

Ange
Yes.

Andy
I love this.

Ange
Yes. So overarchingly, there is a very specific formula that we share with Lifestyle Tradie members so that they can stay on top of these numbers every day because they are that important. This data will literally make the difference to ultimately increasing profit.

Andy
I absolutely love this formula.

Ange
So watching the numbers of your business through this lens of the $7 to drive profit will literally give you an edge to business because I’m telling you, no trade business owner does this stuff unless your members of Lifestyle Tradie. And as you can imagine, this has a flow on effect down the line of the formula that all starts with the number of leads or the calls that you receive of a high caliber A Grade customer. And hence how you answer that phone to convert them to an appointment is critical.

Andy
It is then onto the number of quotes you provide and how you convert them to equal the number of customers you work with.

Ange
Yes. Which takes us to increasing turnover or revenue through two dials being increasing average dollar sale, and the number of transactions, which is about repeat clients, getting them back.

Andy
That’s right. Which brings us to increasing profit through squeezing profit margins.

Ange
Yes. The improvement and hence efficiency of each stage of the $7 to drive profit will impact the next. Make sense?

Andy
It makes sense. And as you said earlier, the devils in the detail and it’s far easier to make decisions in your business when you know what you’re dealing with.

Ange
Yeah, that’s right. So the conversation around I need more customers will be very different because your immediate response will be, Hmm, do I have any outstanding quotes? Or how can I improve the quote flow system to increase conversion? Yeah. Or what is my current number of A grade calls and what is the conversion of that? And all great questions. Right?

Andy
And guess what? It’s not a guessing game anymore based on your gut feel, you can be proactive in making change within your business in order to achieve business excellence. And it’s definitely a better way to improve confidence when operating a trade business. It’s decisions based on the true hard facts.

Ange
Yes, data is king. It is. Right. . So there are so many benefits to this formula, but an important one to mention is this compounding effect. Mm-hmm. . Yes. As you increase the leads at the front of this formula, it has this huge flow of effect down the line and this opportunity for scale. So implementing the right processes and educating your team that drive the right results can be managed by others within your team easily because it’s all data driven.

Andy
Yep.

Ange
They have either made changes to improve the numbers or they haven’t. It’s as simple as that. So it’s easy to track and really easy to.

Andy
Yeah, but when you do this, your business becomes this well-oiled machine that runs without you and it’s still really profitable. What an absolute game changer.

Ange
Yes. I know. There is other financial data that’s important to monitor when it comes to your trade business. But this lens of the $7 to drive profit is certainly one to watch within your business daily so that you see the effects of the sales and marketing techniques having on conversion. Yep. Knowing this is gonna change the way you do business. I swear on that and I know it’s hard to listen to this formula without kind of seeing it as a drawing. So I’ve developed a download. So can I urge you to click on the link in the show notes or head to lifestyletradie.com.au/free-resources so that you can get your hands on the model. I just think it might make a little bit more sense when you actually see it in front of you.

Andy
Well, I’ll listen. I reckon that most of our listeners out there get the grasp of it, but until you see it on paper, it’ll make sense. And obviously we’ve been using it with a lot of our guys and they’re smashing it and they’re seriously scaling their business when you get this right. Well, I think it’s time to wrap this thing up. It’s almost like we’ve dropped a math spam on everyone’s lap and said, see ya.

Ange
It kind of feels like that. Yeah, but that’s why I definitely recommend downloading the PDF so you can just literally wrap your head around it more.

Andy
Yes, and I’m sad to say that this is actually our last episode for season six.

Ange
Oh, don’t be too sad. , we’re gonna be back in a couple of weeks kicking off with season seven, but in the meantime, if you’re interested in understanding more about how you can streamline your trade business for increased profit and more control, then you might wanna consider jumping on a strategy call with Andy. Here’s what some of our members have to say about how Lifestyle Tradie has helped them.

Member’s testimony
Don’t wait. These guys are very honest and open. They share so much information, personal as well as, um, business. Uh, it’s a holistic approach to life, not just, uh, how to run your plumbing business.

Yeah, I definitely joined Lifestyle Tradie. The amount of support and knowledge which is within the program is valuable. Um, the other thing is, The community that Lifestyle Tradie has developed is amazing. There’s been so many times where I’ve learned on the community’s advice, where we’ve had certain issues that we’ve been able to bring up in our, you know, Facebook group. You get plenty of answers that you can actually take. You don’t know what you don’t know.

Lifestyle Tradie has a huge sense of community, just a great group of people just hanging out, helping everyone out, and they help you out. Just hanging out after the events is always fun as well. Some great speakers come along and definitely always, always learning stuff from every event we go to.

Do it. Like don’t hesitate every year that you put it off, there’s just an extra year that you’re losing. You don’t get this time back. That’s one thing that we can never buy as time, so you need help, get it.

Andy
I would seriously love to chat with you guys and to show you how I can help you, just like what we’ve done with our members. So head to lifestyletradie.com.au and lock in a time that best suits you. We can have a really quick chat about your business and where it is currently and where you want to take it, and how we can get you kicking some serious goals.

Ange
Woo-hoo. Kicking serious goals. See you guys in a couple of weeks.

Andy
Catch you then. Hell yeah.