I have a small remodeling business.?

I cannot seem to get ahead. I have adds in the paper and seem to get calls from people wanting jobs instead of work. I am insured, bonded and registered with the state. everything you are supposed to do. I am always losing to the fly by night guy who doesnt have any of theses things. I have spent thousands of dollars in tools. There is not nany things I cant do.... So how do I turn things around?