Rhonda Dowdy has navigated a trade business through decades of changing iterations of service and internal leadership. She and her husband founded Austin-based S & D Plumbing in the 1990s.
Dowdy is now the CEO of S&D, a residential operation that has 32 employees and a commercial division of 25 people, set to do a combined $6.8 million in sales this year. Dowdy talks about finding your niche, the benefits of trade associations and what to do when generational leadership plans don’t go quite as planned.
Here are Rhonda Dowdy’s top insights for running a trade business:
Key TakeawaysFind your niche and build on it.People like the ‘mom-and-pop’ angle.Switching to commission-based pay is worth it. Professional associations are a great information source. Give all employees a chance to achieve bonus pay. Realize that everybody plays a role in success. Handling family leadership succession is tricky. Teamwork and promoting from within pay off. There are plenty of hard-working women in the trades. Recommend research and reading
Find your niche and build on it.
In the early ’90s, before there were cameras or leak detection equipment, Dowdy’s husband, Sam, realized he was good at finding plumbing leaks. “That became our niche,” Dowdy says.
“We began a relationship with an insurance company and then that led to another insurance company. That's really what helped us grow exponentially. We’ve expanded since then, but we’re still leak detection specialists to this day.”
People like the ‘mom-and-pop’ angle.
Companies that are just starting out and are truly “mom-and-pop” operations should take advantage of that label when doing marketing.
“That helped us when we first started out,” Dowdy says. “We also set our rates by being a little lower than the next guy.”
Switching to commission-based pay is worth it.
About seven years ago, flat-rate wasn’t a much-liked word in Dowdy’s company. “But we went to commission-based pay for techs and menu pricing,” she says. “We wanted to reward the techs that were achieving well.”
Dowdy says it was a huge change and had rough patches, but ultimately everybody bought in.
Professional associations are a great information source.
More than a decade ago, S & D Plumbing got involved with Quality Service Contractors and the Plumbing-Heating-Cooling Contractors Association.
“PHCC and QSC helped us tremendously,” Dowdy says. “Best practice groups are great. We’ve learned from being in classrooms as well as from talking to other people who are in the same business as you in different parts of the world.”
Give all employees a chance to achieve bonus pay.
Every employee in the company has a chance to meet job-specific Key Performance Indicators and earn a bonus. Employees have six KPIs. Hit four and you pass; achieve five and you’re eligible for a bonus.
“If the company hits minimum net profit, we pay out bonuses,” Dowdy says. “There has to be a net profit to be able to pay out bonuses—but if everybody passes their scorecards there’s likely to be a profit.”
Realize that everybody plays a role in success.
“My oldest son read a book called Rocket Fuel that basically showed why my husband and I worked so well together in our company,” Dowdy says.
Her husband fit the book’s definition of a visionary; Rhonda is the integrator.
“The book talks about putting the right people in the right seats,” she says. “It’s all about enhancing communication and creating a good Entrepreneurial Operating System.”
Handling family leadership succession is tricky.
About a decade ago, Dowdy’s husband stepped aside to let their two sons run the business. Each wanted to be a leader, so they split the company into two divisions. Later, one son decided to pursue another line of business.
“We’re looking at the transition from a Dowdy family business to a focus on the team family,” she says. “We’re working on raising internal leadership to the next level.”
Teamwork and promoting from within pay off.
“We took one of our biggest producers out of the field to come in and be general manager,” Dowdy says. “It was really scary, but we went for it and now he’s knocking it out of the park.”
Dowdy says her new GM is detail-oriented, good with customers, cares about employees, and is a good trainer. “He’s hands-on with all the techs, and he’s raising them up to a higher standard.”
There are plenty of hard-working women in the trades.
“Women may not necessarily put on the tools, but we do work hard,” Dowdy says. “Our CSRs, our dispatcher, our accounting and marketing departments, many of those are women, work so hard and take so much pride in what they do.
“I have not hired a female technician, but I would in a heartbeat if there was someone who applied. I just don't want the women to be overlooked. We work really hard to make things happen.”
Recommend research and reading
Rocket Fuel: The One Essential Combination That Will Get You More of What You Want from Your Business, by Gino Wickman and Mark C. Winters
Traction: Get a Grip on Your Business, by Gino Wickman