It dawned on us a few years ago that for every company that contacted us for marketing, nine out of 10 were struggling in other areas or on their last dime of marketing money for the business.

We started reviewing recorded conversations and realized that we were giving out as much or more core business advice as we were marketing. We’ve noted the top three things we believe you have to nail to grow a business — and we mean any type of business.

Pricing correctly

Every business has to establish a financial foundation to build upon. Without a solid financial foundation, eventually a business finds itself in trouble and has to figure out how to get out of it. A great place to start is to make sure you are getting your pricing right. 

Here are a few favorite responses we have received when we asked about how pricing was established for products and services:

I look at what my competitors are charging and price $10 below them on everything.

I asked my grandmother what she would pay for our services and that’s what I charge.

I know what people around here will pay so that’s what I charge.

Let’s take these one by one and see why this thinking won’t get you to where you want to go.

If you are pricing based on your competition, how do you know they did their pricing correctly? Did they do the same thing you did so that over time you are all on a race to the bottom? This is a business disaster waiting to happen. Unless you want to do everything yourself and stay in a state of stress and panic constantly, this is no way to price a service or product.

While the second pricing tactic might seem charming to your grandmother and family, my guess is that unless people your grandmother’s age are your only target market, your grandmother doesn’t reflect the majority of customers. There is also a wide margin of what one person will pay for a service compared to another. Most people will tell you they are OK with paying more for really good customer service. Are you trying to serve those people well? What is your target market?

And, even if you know exactly who they are, what they will or will not pay is not a good way to establish pricing. Know-it-alls don’t always make great business owners because, well, they already know everything. However, when the ship starts sinking it would be wise for them to get some expert advice to get their financial house in order.

One of the places we learned this lesson from is Ellen Rohr, who wrote the book How Much Should I Charge? She tells a story about how she almost sank a plumbing business by not charging enough to cover expenses and make a profit. It applies to any and all businesses. Prices are not based on what you think or ask others to pay. They are based on what you need in order to run your business successfully. We highly recommend reading this book if you are struggling with pricing for any product or service.

Hiring correctly

There is a marked difference between a sole proprietor and a business with employees. The sole proprietor trades hours or jobs for money and is limited by the hours of the day or the amount of jobs that can be performed in a day. For those who want to grow their business and not be bound by the limits of what one person can do, you have to hire employees. If you have ever had to hire, then you know it can be a challenge.

You will hear about hiring a “dream team” that will change your business or just hire all “A” players and your prayers will be answered. While that all sounds great, most business owners have never thought about what the A-players on a dream team are looking for. The best workers look for great companies to work for, not just a paycheck.

So while you are looking for the right people to hire, they are looking for the right company to work for. Before you even start to hire, you might want to look at your business and leadership and ask if it would qualify as a business that A-players on a dream team would want to be part of.

If the answer is no, then you have to do the work on yourself and your business first before you will attract the type of people you want working for you.

What should you do in the meantime? Read books and listen to podcasts that can help you and your business grow and implement as you can. Growth is never a straight line so stop expecting it to be. A business grows as the individuals in the business grow as people and leaders.

Here’s a good book to start with: The E-Myth Revisited by Michael E. Gerber. This book helps entrepreneurs to understand the different roles that they need to play in their businesses, and how to transition from being a technician to being a CEO. 

If you’re looking to grow your profitability, read Profit First by Mike Michalowicz. This book teaches entrepreneurs how to manage their cash flow more effectively. It introduces a new way of accounting that focuses on profitability over revenue. Profit First for Contractors by Shawn Van Dyke is a more detailed book, especially for contractors, and is a great read after Profit First. 

If you are looking at your business culture or leadership, read Start with Why by Simon Sinek. This book helps entrepreneurs to identify their company's "why" and to communicate it to their customers and employees. Another book is Gino Wickman’s Traction as it provides a framework for entrepreneurs to scale their businesses. It covers topics such as vision, strategy, execution, and people.

If you are looking for a podcast series, consider “The Business Growth Series” with Tommy Mello. He has pulled together eight episodes from his popular podcast “Home Service Expert” concentrating on business growth. Mello has also written a couple of books that you can get on audio as well, Home Service Millionaire and Elevate, which are both great reads or listens.

Marketing spend

As marketers, you’d think this would be the No. 1 thing we’d be pushing: Spend more money on marketing to grow your business!

The truth is that just throwing money at marketing without having the right things in place and knowing where you want to end up is a recipe for disaster. We wonder if the better name for our business would have been “Smart Marketer” as opposed to “Spark Marketer” because spending money should be a well-thought-out process.

This past week a chiropractor was referred to us and we spent over an hour talking to him about this one thing. Every marketing company he spoke to added another service to his marketing spend and he was now at a place where money was going out, but he wasn’t seeing any more patients coming in than before. This seems to be more common than you would think as businesses continue to try new things in search of a silver bullet. 

What are some of the things you need to have in place? The first is a place where people can go to see what you do and how they can work with you. Most people jump to a website, which in a lot of cases is the right decision. However, some businesses can create a great start and presence on a number of social platforms. It depends on what you do and where your target audience will look for that product or service. Knowing these facts before you spend a lot of money on anything is important.

Granted, we work in the home service industries so websites are by far where most people will go to choose a local vendor to come to their homes. That said, every social platform is also a search engine so if you don’t have money for a good converting website that can compete in your market, you have a lot of options where the cost is in time rather than money.

The next step for a local business is to get a Google Business Profile in place. We would also suggest setting up Bing Places as well so that you also have a local presence in Bing. There have been a lot of changes surrounding getting a Google Business Profile established, so make sure you read up on everything before starting the process.

Once you get those two things up and running, the main thing you have to do before putting any more money into marketing is making your customer service memorable for the right reasons, asking for reviews, and making sure you are getting great reviews. 

While most business owners will tell you they try and do a certain thing, their reviews may say otherwise. If you have a number of negative reviews online or a rating of less than 4.3, then you can be No. 1 everywhere and spend money all over the place and you will not grow your business.

We take multiple calls every year from home service business owners who are mad at their current marketing company because what they are doing “isn’t working.” Then we take a look and they rank well, they come up in their area well for Google Business Profile. Then we see a 3.2-star rating. We start looking at other review sources, Facebook, Yelp, BBB, etc, and see that it is not an outlier. Most of the negative reviews have not been answered. When we ask the owner about the reviews, here are a few things we have heard:

You don’t understand. All those negative reviews are about one person. (We then learn that the person is still employed.)

I don’t have time to deal with stupid people who give us negative reviews!

Who has time to answer all those people? I’m working!

Marketing can overcome a lot of things, but it cannot overcome a bad employee (or owner) who is tanking your reviews, nor can it overcome the way an owner thinks about his customers, and it certainly cannot overcome the unwillingness to answer people’s concerns about your service or products. Knowing this should help you understand just how important reviews are to your overall marketing strategy. 

No matter what you do, if your reviews are bad, fix that first before you start spending a lot of money on marketing. Today, 92% of customers are looking at reviews before they make a decision to buy or call. Make that decision easy.

About the Authors

Carter Harkins and Taylor Hill are the authors of Blue Collar Proud: 10 Principles for Building a Kickass Business You Love and the owners of Spark Marketer, a "no bull" digital marketing company that’s been getting sh*t done for home service businesses across the nation for a decade. They’re trusted thought leaders in the industries they serve, which is why you’ll find them regularly speaking at service industry trade shows and conferences and writing for trade magazines. Tired of empty promises and ready for focused digital marketing and balls-to-the-wall dedication that gets your business seen? Visit www.sparkmarketer.com.