Mike AndesFounder, Augusta Lawn Care and Homeworks · Founder of Homeworks and Augusta Lawn Care

How to Transition OUT of Unprofitable Project Work

28 Jan 2025 · 0 min

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A short transcript of a conversation (Mike Andes + another speaker) about shifting away from unprofitable project work. Key points: accounts receivable are large and time-consuming; maintenance work has doubled and is profitable while taking ~20% of time; projects are unprofitable; proposed actions include cutting unprofitable projects, raising project prices, and timing staff reallocations (targeting March) to move people from projects into maintenance if higher-priced projects don't sell.

Projects. We are getting massive accounts receivable. It's taking all of our time. We aren't making money on it. We've more than doubled the maintenance over the past few years. We're profitable on it, and it doesn't require but probably what, 20% of your time?
Yeah, yeah. I mean, that's probably true.
Why don't we cut it?
There would be six people right now that I would be like, man, what do I do with them?
But what if we raise the prices on our projects? We basically told them, this is what's happening. We're going to be increasing the maintenance side because if we need two people come March, I feel like that's a perfect time to start making the transition, knowing that if we don't get the project sold at the higher rate, we now can move a couple people over to the maintenance because we need them in March.