Mike Andes covers small-business fundamentals: stop offering free work, raise prices to build contract margins, focus on sales to land more deals, and hire people instead of buying equipment. He targets 40 to 50 percent profit margins.
Reach 40% ("Just keep raising prices until you're at 40%.")
45%–50% (speaker says: "If I'm at 45, 50%.")
And that's how you make a profitable business. He's constantly going after new contracts. And even Will's frustrated by the fact, like, he's like, oh, let's throw this in to, like, get the contract.
He provides services for all the Taco Bells in New Hampshire, which is great, but then he wants to fertilize all those companies without getting paid for it.
That's how you lose money. What we should be doing is raise all the prices so we have room for a contract. And he's focusing on sales to bring in more contracts. If I'm above, If I'm at 45, 50%. We were raising prices. Yeah, we're trying to grow. I don't want to buy more trucks. I want to hire more people. Just keep raising prices until you're at 40%.
