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You might agree with that statement if your business depends on getting leads. Hardly a day goes by that we don’t get a phone call or an email from a contractor asking, “How do I generate leads?”

Unfortunately, that’s all that too many contractors care about. They believe that if they get enough leads and can bid on enough jobs, they’ll be successful. That’s not the case.

You don’t want to just throw time and money at generating leads; you need to generate quality leads. And if you don’t know what to do with those leads once you get them, they’ll cost you money instead of making you money.

These are leads that are gold:

  • leads in a neighborhood within your service area
  • leads requesting work that’s your specialty and produces your highest margin
  • leads from clients who are happy they worked with you and satisfied with the project you built
  • leads that come from your own marketing efforts

These leads aren’t gold:

  • leads from a neighborhood outside the area you can comfortably service
  • bathroom remodel leads when you’re a deck builder
  • window replacement leads if window replacements are your lowest profit jobs
  • leads from clients who can say, “Hire this guy, his prices are low.”
  • referrals from the client whom you let negotiate the price, resulting in a zero profit or low profit job

If you want leads that make you money, figure out what you do best. That’s defined as the jobs that make you the most money. Then determine your ideal client: where do they live, what part of town, what kind of home, etc.

Now focus your lead generating efforts on your most profitable jobs with your ideal client. How do you get them to pick up the phone and call you about having that work done?

It isn’t going to happen when you depend on a lead-generating business. It’s going to happen when you’re in charge of your advertising message.

In many cases, prospective clients will either find you via your website or visit it after hearing about you. They want to see if you qualify as a contractor they can trust and who will do the job they want done, on time and at a fair price. When they’ve researched you and then called you, you get out of the bidding game and you can begin selling yourself and your jobs for what you’re worth.

You don’t want leads so you can give out bids. Bidding means that you hope to offer the lowest price for a given job. When that happens, who wins? Not you, that’s for darned sure.

The only way you’ll make a profit on your jobs is if you price your jobs to cover all job costs, cover your overhead expenses and make a reasonable profit. And the only way you’ll make the sale at that price is if you’re actively developing your sales skills. You won’t sell every lead. In remodeling, if you’re selling more than one in three leads, you’re probably selling too cheap. Ideally, you should be able to sell one out of every three and a half to four leads.

Yes, you want leads, but make them quality leads, and make sure you know what to do with them when you get them. You don’t want to win bids; you want to sell your jobs at the price that makes you a fair profit.

We have tools that can help. So do others. You don’t have to do this alone.

Just don’t forget what business is about: providing a service and making a profit doing it. The “making a profit” part is what makes your contracting business successful.

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