Owning and operating a construction business requires a strong will and self-direction, but those qualities can also lead you to hold on to beliefs that limit your profit.
All price proposals need a deadline because you never know when material and labor costs will increase rapidly.
Construction sales take time and your time is valuable. Avoid these common time-wasters when selling construction services.
The purpose of a design agreement is to get a commitment from your client to design the project so you don’t have to do the design for free. How do you keep the design within the budget?
A construction website should be a lead generating asset. It doesn’t have to be expensive, but if it doesn’t generate leads it’s a waste of time and effort.
It’s not unusual to find a contractor who sells by deliberately underpricing or underbidding jobs and making up the difference with change work orders.
A business owner in the UK asked a question that illustrates that remodeling sales challenges are the same regardless of your location.
Getting a commitment from potential clients is critical if you want to save yourself a ton of time and work putting together an estimate that won’t go anywhere. You have better things to do with your time.
Budget doesn’t need to be a major worry during the design and build of a project if you handle it properly during the sales call.
Sales is about communicating and interacting positively with others. Those skills make life easier in any delicate conversation.
I recently had to face what I thought would be an uncomfortable personal conversation. I fussed all morning, then went to visit the person involved.
I want to share a recent phone conversation with a contractor concerning a problem they were having with a client.
I’m a firm believer in treating salespeople well. When they’re treated well, they’ll sell. When they sell, you win.
This note is a painfully perfect example of why you shouldn’t provide details on your pricing.
A contractor sent us an online article written by a real estate investor with the purpose of educating you on “how to develop a fair relationship with your contractor.”
Insurance work can be good business, but it can also waste your time if the insurance company is playing the three bids game.
A guest article: How do you avoid going out on sales calls to look at jobs for folks who obviously do not qualify to purchase from your company?
Is there anything you can do about the sales you miss?
It’s summer, and that means community gatherings for people wanting to have fun. In our area, the main event is the county fair. I’m confident there is a similar event in your area.
“The #1 reason I lose jobs is ‘your price is too high.’ What am I doing wrong?”
It’s time to catch up on some spare topics I have lying around. These aren’t earth shaking but they can and will impact your bottom line.
Give clients options when you quote the work they want done.
What do you do when your partner is listening to someone who knows nothing about construction, but still thinks they knows what’s best?
We’re aware that homeowners also visit our website. This letter is from a first-time homeowner who’s ready to buy, but his builder isn’t cooperating.
Most home improvement sales copy is filled with nothing but generalities and platitudes. It gives no real reason why a prospect would want to take the next step.
The last thing I want to do is cause a family problem, but apparently I did with one family.
Flaky contractors make us all look bad. But not all advice given to homeowners to protect themselves from fraud is good advice.
Don’t come up with excuses to not be marketing your business. Eventually you will be in the worst position of all, and that is when you say “I need quick help to get my phone to ring”.
When something seems amiss, don’t stop asking questions. A contractor shares his experience on a recent sales call.
Clients are changing, and if you want to stay in the game and make something more than a living, you’ll need to change with them.
You should stop providing free estimates. It’s called free consulting, and you won’t be successful giving away your time. (Guest Article from David Lupberger, Remodel Force)
We discussed design agreements last week; today we’re going to look at them from another angle. The first step is setting the budget with the client.
A contractor who has designed projects asked how to protect his design work.
A contractor we’ve known and worked with for many years sent us a note about his experience working with a new architect. Ideally, the architect would have been working with the contractor from the beginning so he could have educated the client as well.
Business cards are a simple, inexpensive way to provide everyone you come in contact with the information they need to reach you.
A good guy we know was recently working with a potential client when he ran into some concerns.
One of the more unpopular things I recommend is canvassing the neighborhood around your jobs. It’s unpopular because it’s misunderstood.
It’s smart to specialize on the work that makes you the most money. It’s even better if you know contractors who can pick up the leads outside your specialty.
A contractor in Hawaii sent in a note asking about a few sales issues.
If they called you, doesn’t that mean they need or want the work done?
The topic is uncomfortable but if you’re involved in residential sales, you’ll see family disagreements. It helps to know what to do.
Many contractors who write us are having a problem with their business, and in many cases, it’s because the contractor has lost focus on what’s important.
Should you let a client work on the job they’ve hired you and your company to build?
How should you handle a mistake? What if it’s a mistake you made over a decade ago?
Since the end goal for both the architect and the contractor is a satisfied client, how about working together from the beginning?
Should you take every opportunity to increase exposure for your business?
If you’re a dependable, responsible construction-business owner, do potential clients in your area know you exist?
As we head into Memorial Day weekend, we want to share an upbeat note we received in April from a client.
It’s amazing the things a potential client can think of to get you to lower your price.
The one question too many salespeople stumble over is the budget for the job. They are worried that it looks bad to ask.
Is transparency the way to go when selling? Be careful who you listen to.
We recommend setting goals every year, beginning the process about now. If making a profit is one of your goals, Michael outlines practices that will help.
We were recently asked about an online service designed to make it easier to handle sales calls.
Every day we drive by a new home under construction. I don’t know how many people pass this new home every day but I would guess it’s in the thousands; the road is always busy.
A survey outlines the challenges homeowners say they’re facing when they remodel or renovate their home. It’s valuable info, because it tells you what they need help with. It’s your job to show them you can provide that help.
A recent Houzz survey confirmed what you need to know if you’re in sales; it’s not all about price.
What do you do when a potential client waits until the proposal is together to request itemization on the project?
“We don’t advertise” is well meaning mischief at its worst. It cuts your company off from a large pool of potential clients who are looking for a contractor to help them get their job built.
An objections book is a history of your sales calls. It includes everything you said and did, right or wrong. I have only met two or three others in my thirty-plus years of direct selling who took the time to compile a book, but each one became outstanding in their profession.
A building owner challenges our statement that contractors shouldn’t itemize their estimates.
In our book, Profitable Sales, A Contractor’s Guide, we discuss the need to set the client’s budget for a project. One of our clients sent a note recently that explains why setting the budget up front is important.
I’ve been around the construction industry long enough to know that it isn’t always rosy. When a recession hits, construction is one of the early victims.
If you’re doing service work, make sure your client knows what to expect before you start.
I received a note from Michael Stone. He said, “You wouldn’t believe some of the stories I hear from contractors being approached by people claiming they can help with SEO or getting leads. I want to cover this in a newsletter.”
I’ve been reading advice in a few construction magazines on how to sell to millennials, and I don’t understand the fuss.
“I have more work than I can do. I tell new leads to call me after the first of the year.”
Some business relationships turn out badly; with experience, you can identify and avoid them.
A young guy asked if signing on with one of the big box stores was a good idea. He hasn’t discovered yet that getting a lot of work doesn’t mean you’ll make lots of money.
Generally speaking, when potential clients don’t want to make a commitment but want to keep your paperwork, they intend to shop it around.
Too many homeowners believe they need three bids for their project. The intent, of course, is to compare proposals so they can make the best decision.
Some clients want the lowest bid for their project, and nothing else matters. It’s your job to try to educate them.
Some advice on hiring a contractor is just plain wrong.
One-legged sales calls. Frankly, this is much to do over a problem with a fairly simple solution.
I recently read an article reviewing a new lead-generating service, and it stated, “Our contractors only pay us a 5% referral fee, once they win the job.”
Are you bidding on jobs, or are you selling them? There’s a difference.
Another day, another service that helps homeowners find a contractor.
What you do has value. Respect your time and your knowledge.
Sometimes a potential client expects you to work for free. That’s not a smart route to take unless you have a lot of money in the bank and time on your hands.
There are two steps to attracting leads. The first step is being known; the second step is making them interested enough to contact you.
On a sales call, if you’re speaking and your potential client is thinking “so what?”, you’ve lost them.
When your client wants a lower price, something has to change. It shouldn’t be just your price.
It’s the beginning of the holiday season, and I’d like to talk about a topic that can change both your sales ratio and your family relationships.
Given how valuable leads are, once you get one, you need a sales procedure to help make the sale.
An architect he knew asked him to meet with the owners of a proposed new home. As they were discussing the project, the architect asked our friend, in front of the clients, “What’s your overhead and profit percentage?”
One problem contractors run into is dealing with clients who want to change the scope of the project after signing the design agreement, and not realizing how it might impact their budget.
It’s cheaper to ask questions than pay for mistakes. A coaching client is trying to fix the problem created by an former salesperson’s expensive omission.
Can you be too professional? A contractor shares the story of a sale that he was told he lost because he was dressed too professionally and responded to questions too confidently.
How much should you spend on advertising? How much is too much?
When I think about major influences on my sales training, I think of Tom Hopkins. He was an outstanding salesman who become a gifted sales trainer, and I still receive and read his newsletters.
A design agreement is nothing more than an agreement to work with the client to design their project. That’s not the final goal of a remodeling contractor; your business is about building projects.
I’m not convinced that Porch is interested in helping our industry. From what I’ve seen, I think they’re only positioning themselves to make money off contractors.
A referral fee is what you pay to the person who provides you a lead. A sales commission is what you pay a salesperson to close a sale.
A potential client wanted to get a bid on some work at her home. Our coaching client was pretty sure the lead was dead, and wanted to know if she should have done anything differently to have made the sale.
If salespeople know the business owner will back them up and pay them fairly, they’re motivated to produce profitable sales. If they aren’t motivated to make sales, the business is in trouble.
Real or fake outrage can be a client’s attempt to elicit an emotional response from you to get what they want. It often puts you in the position of questioning yourself and your company, not dealing with the subject at hand.
Every once in a while, your phone will ring and the potential client on the other end will tell you they want a bid today. What should you do?
Never let your final payment exceed 2% of the sales price. And your contract should include a finance charge clause for payments not made on time.
Too many contractors care only about getting leads. They believe that if they get enough leads and can bid on enough jobs, they’ll be successful. That’s not the case.
If you're one of the many contractors who start an advertising message with, "We specialize in . . . ", good for you. But if you follow that statement with a long laundry list of things you do, you're hurting your business.
Last week, a contractor called to ask my opinion on getting involved with storm chasers that were in his area.
One of the questions we’re asked most often is how a subcontractor can get jobs. How do you go about meeting general contractors and letting them know you’re available to build their jobs?
A major mistake contractors make is to tell a client they can’t start the job for 3-4-5 months. “We are backlogged, can’t possibly start your job before then.”
What if you agreed on a price, now customer wants all receipts for material? Without a clearly written fixed price contract, it's a problem waiting to happen.
My clients are constantly chiseling me down, everyone makes money on the jobs except me.
If you're a remodeling or new home contractor, how can you get clients to make their selections before you write the contract? Make it easy for your client.
What’s the average cost per square foot for a remodel? Average contractor markup? Average contractor fee? There is no average anything in construction, and here’s why.
Address their fears so they feel safe purchasing from you.
Brainstorm business opportunities that your construction company could do, profitably, over the next twelve months.
Ten Cardinal Rules for residential construction sales.
Claim your business in local search sites and social media. Almost always free, only takes a minute, might bring in leads, and it will protect your name.
Don’t worry about what “the other guy” is charging.
“Your price is too high” means you haven’t done your job as a salesperson.
Building a website for your small business doesn’t have to be expensive, and it isn’t that complicated when you understand how it works..