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  #1  
Old 5/18/16, 3:00 AM
Nick Gromicko, CMI's Avatar
Nick Gromicko, CMI Nick Gromicko, CMI is online now
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Default How to get rich in the inspection business.

As I travel around on tour for InterNACHI, I'm often asked: "Nick, how do I get rich in the inspection business?" In the coming weeks on this message board thread, I'm going to answer the question. Remember, the purpose of being in business, any business, is to make money. If you want to make a good living, don’t go into business. Instead, get a good job. The only reason to be in business, and take on all that entails, is to make a really, really great living.

Let’s start by understanding the miracle of math. I’m not going to use anything more than multiplication in this article (no advanced math), so don’t worry.

The processes that have to occur for your inspection business to convert a consumer into a good-paying customer are many. You have to market your inspection services. You have to get a consumer to come to your website. You have to get your website to cause the consumer to call you. You have to get your phone conversation to cause the consumer to hire you. You have to charge as much as you can for your services. You have to sell additional ancillary inspection services. And finally, you have to get your happy client to refer additional consumers (leads) to you.

There are probably many more steps to this process, but for purposes of example, let’s say there are seven steps. Now let’s rank each step according to how well your inspection company executes them. We’ll use a rank of 0 to 10 with 10 being perfect. So for example, if you convert every consumer who calls you into a paying customer, assign a rank of 10 to that step in the process. If you convert none of them, assign a rank of 0 to that step in the process.

After you rank all seven steps, multiply their ranks to find their product (final result). This final result represents your company’s success (the higher the better). You should perform this exercise regularly to see how your company is doing.

I’ll create a rank for each of the seven steps used by a hypothetical company I’ll call it ABC Inspection Company: 2, 3, 8, 6, 4, 8, and 7. The product of these ranks is 2 x 3 x 8 x 6 x 4 x 8 x 7 = 64,512. This final result, 64,512 represents ABC Inspection Company’s success. It only has meaning relative to the other times the owner of ABC Inspection Company performed and will perform this calculation. It is a number that has a correlation to gross revenue. It’s not a one-to-one relation, but this final result is an indicator that tracks gross revenue. As this final result goes up or down, so does ABC Inspection Company’s revenue.

In the steps, I intentionally left out things that don't affect gross revenue, but do improve net revenue (bottom line) such as increasing efficiencies, limiting losses, and tax avoidance. We'll address them later.

Now let’s pretend the owner of ABC Inspection Company decided to try to improve each of the seven steps. Let’s imagine that he was not very successful and only improved each step a little bit. He did some work to improve his website, he found a way to convert more incoming calls into scheduled inspections, he found ways to charge more, etc. Like I said, he didn’t improve each step dramatically, but he did improve them all slightly. Let’s say that he improved each of his steps by only 1 rank. The rank of his steps then go from 2, 3, 8, 6, 4, 8, and 7 to 3, 4, 9, 7, 5, 9, and 8. Not much of an improvement, but a little improvement in each area.

What effect does a small improvement in each step have on the final result? If you think these small improvements had an overall small positive effect on the final result… you’d be very mistaken. Remember, prior to the improvements, his final result was 64,512. So using the slightly improved ranks, let’s do the math:

3 x 4 x 9 x 7 x 5 x 9 x 8 = 272,160. What? 272,160 is more than 4 times greater than 64,512. Making a small improvement to each step of a process can improve the final result dramatically. In this case, it improved it by 321%. That’s miraculous!

This is the secret to getting rich in the inspection business.

Actually it’s a secret that is well known in the e-commerce industry. If you double the number of visits to an e-commerce site, double the number of those visitors who purchase, and double the dollar amount they spend, you don’t just double revenue. You multiply revenue by 8 (2 x 2 x 2). That’s not a gross revenue increase of 8% (which would be whopping). It’s an increase of 700%!!! Small improvements make a big difference.

Now imagine the effect that large improvements would have on your inspection business. I’m going to show you how to make large improvements to your steps, which will dramatically increase your gross revenue.

Home inspections are fun, but now it’s time to get rich. Stay tuned.

Last edited by gromicko; 6/1/16 at 3:38 AM..
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  #2  
Old 5/18/16, 3:52 AM
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Default Re: How to get rich in the inspection business.

Very interesting thanks Nick, looking forward to more.
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  #3  
Old 5/18/16, 6:07 AM
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Michael W. Altizer, CMI Michael W. Altizer, CMI is online now
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Default Re: How to get rich in the inspection business.

I will definitely be watching this thread closely and putting what Nick says into action.
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  #4  
Old 5/18/16, 8:09 AM
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John McKenna, CMI John McKenna, CMI is offline
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Default Re: How to get rich in the inspection business.

I called most of the InterNACHI members in Denver the other day. Only 30% answered the phone with a live human being. Then people wonder why they struggle to make money. Think about it.




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  #5  
Old 5/18/16, 9:13 AM
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Randy Dimit, #60269 Randy Dimit, #60269 is offline
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Default Re: How to get rich in the inspection business.

Quote:
Originally Posted by jmckenna1 View Post
I called most of the InterNACHI members in Denver the other day. Only 30% answered the phone with a live human being. Then people wonder why they struggle to make money. Think about it.
That's why I have used ACC since day 1. Especially since I work a day gig, but only for 1 more week. Gave notice last week.



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  #6  
Old 5/18/16, 4:29 PM
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Gary Farnsworth, CMI Gary Farnsworth, CMI is offline
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Default Re: How to get rich in the inspection business.

You can make a living, but cannot get rich in this business. Rich is also a general term. Some HI's can live off $40K a year, others complain about making $80K.

Currently there are just too many HI's around charging low prices, and too many HI web sites scrambling for internet hits. Funny how our business parallels that of REA's. Some don't stay around long, others stay in it for years. The overall economy also plays a part.

In over 15 years in this business, I have tried it all. You cannot beat client referrals. Take care of them, they will refer you. Marketing to REA's is a waste of time, as they only want the cheap, non-alarmist HI's. Mike Crow brags about catering to the REA's. Bottom line, it is up to the HI's, and their target working area, on how their business is operated. Lots of variables.



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"If opportunity doesn't knock, build a door"--Milton Berle

Last edited by gfarnsworth; 5/18/16 at 4:32 PM..
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  #7  
Old 5/19/16, 10:48 AM
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Marcy Freeburg Marcy Freeburg is offline
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Default Re: How to get rich in the inspection business.

I may be an oddball here, but my intent is not to get "rich", but to have a career that I enjoy, can pay the bills with, and still have time with my family. I'm going to follow this thread though, because if I can make enough to cover what I said, my husband can retire, and that folks is living like no one else! Heck, maybe I'll let him in on my business...





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  #8  
Old 5/20/16, 2:28 AM
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Nick Gromicko, CMI Nick Gromicko, CMI is online now
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Default Re: How to get rich in the inspection business.

Quote:
Rich is also a general term. Some HI's can live off $40K a year, others complain about making $80K
I agree that "rich" is a general term. It can also be a drastically different depending on where you live. But I'm talking about bringing home (netting) at least a couple hundred grand a year or more.

Last edited by gromicko; 5/26/16 at 5:31 PM..
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  #9  
Old 5/20/16, 2:31 AM
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Nick Gromicko, CMI Nick Gromicko, CMI is online now
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Default Re: How to get rich in the inspection business.

What makes a consumer consider hiring you? I'm not asking what makes them decide to hire you (that comes later). I'm not asking what makes them use you again after they know you (that comes later). I'm not asking what makes them refer you to their friends and family members (that comes later). But what makes a new consumer at least consider you at first? I found out the answer by sheer accident.

Last edited by gromicko; 5/20/16 at 2:53 AM..
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  #10  
Old 5/20/16, 2:48 AM
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Nick Gromicko, CMI Nick Gromicko, CMI is online now
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Default Re: How to get rich in the inspection business.

Years ago, I was a top-producing REALTOR (don't shoot me) with RE/MAX. Being the office's top producer, I got the front, corner office with a view of the street. But from my chair, I also got another view. My office door opened up out into the front lobby where the receptionists sat. In that lobby, opposite from my door, was a wall of brochure holders. Some had RE/MAX literature in them, some had bank rack cards with information about mortgages, but many contained brochures from home inspectors.

Now, in the real estate business, almost all consumers are home buyers. All home buyers are home buyers. But home sellers have to live somewhere when they move. Most often, people move locally. So most home sellers are local home buyers as well. This meant that nearly every consumer who came into our real estate office was a home buyer. The lobby is where they waited. They waited for the receptionist to get done with the phone call she was on, they waited for their agent to meet them, they waited for some paperwork to be copied, or whatever. They waited in our lobby with nothing much more than a wall of home inspection brochures to look at. And by sheer accident, I got to spend years watching them, like a scientist observing an experiment.

Stay tuned... much more to come.

Last edited by gromicko; 5/20/16 at 4:33 AM..
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  #11  
Old 5/20/16, 9:34 AM
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Gary Farnsworth, CMI Gary Farnsworth, CMI is offline
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Default Re: How to get rich in the inspection business.

I have distributed thousands of CMI brochures in holders in dozens of RE offices. Paid for in-office "advertising" in the largest offices in KC, which often have 300+ agents in them. Attended office meetings, thousands of flyers in mail slots, even a local radio show. Fence signs at softball fields, church bulletins, school events/flyers. I am not rich by any means.

Here in KC you have to be under $275 and non-alarmist to get the business. I have been fortunate to work with the top 3% of REA's here in KC, who recommend me often. I charge higher prices, but home buyers think that if you charge a high price, you must be the best. The other 97% hire and suggest the cheap HI's, or the ones who kick-back a few bucks to the REA offices/brokers, who are mostly franchise companies. It is the old 80/20 rule. Market to the 20% of REA's who are professional, recommend the best in all trades, and suggest the CMI's.



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  #12  
Old 5/20/16, 11:40 AM
Juan C. Jimenez Juan C. Jimenez is offline
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Default Re: How to get rich in the inspection business.

LOL SHUT UP GARY. No one cares about your pity party.



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  #13  
Old 5/20/16, 12:13 PM
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John McKenna, CMI John McKenna, CMI is offline
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Default Re: How to get rich in the inspection business.

Home Inspection Success with Michael Pagoulatos (video)

This guy had no background in construction and got started in the inspections business back when the housing market crashed and many many home inspectors were going out of business at that time.

In no time flat, he had so many inspections that he had a hard time getting to all of them. He was flooded with business. It was not because his prices were the lowest, but he had a gift.

His story became so amazing that other large inspection firms hired him to start teaching their staff how to market and answer the phone. This guy was a whirlwind. He became a full time consultant to other inspection businesses and was in great demand because of his wisdom.

His gift = COMMUNICATION

Many think they can communicate, but few have the skills to do it well. It can make all the difference in the world.

This man's main focus was not what you think. Watch the video to learn more. Listen to Nick and learn from a proven master of marketing.




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  #14  
Old 5/20/16, 10:08 PM
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Brian E. Shriver Brian E. Shriver is offline
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Default Re: How to get rich in the inspection business.

I'm definitely interested in this thread. I don't want to get by, I want to be THE GUY. In my county, which is relatively small and rural there was 1200 residential real estate transactions last year. Potential for 2400 inspections, and I want ALL OF THEM. Not even mentioning surrounding counties, I want those too, but my goal s a half a million or better per year. A lofty goal I know, and it won't happen overnight or at all until i become a multi-inspector business. This year I will fall woefully short, but I am always working toward a goal.



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  #15  
Old 5/20/16, 10:34 PM
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David Asselin David Asselin is online now
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Default Re: How to get rich in the inspection business.

Quote:
Originally Posted by bshriver View Post
I'm definitely interested in this thread. I don't want to get by, I want to be THE GUY. In my county, which is relatively small and rural there was 1200 residential real estate transactions last year. Potential for 2400 inspections, and I want ALL OF THEM. Not even mentioning surrounding counties, I want those too, but my goal s a half a million or better per year. A lofty goal I know, and it won't happen overnight or at all until i become a multi-inspector business. This year I will fall woefully short, but I am always working toward a goal.

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