Archive for the ‘Business Growth’ Category

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PowerTips: Resolutions for Better Business Results

Tuesday, January 3rd, 2012 by victoria

Since January is the year for resolutions, I want to get on my soapbox to encourage you to make some important resolutions for your business. Pledge to take these actions and you’ll see productivity, efficiency, and team morale all improve. And when these essential parts of your company improve, profits will follow.

Resolution 1. Create a Plan for Profit! Smart remodelers take the time to create a plan for their business on paper so they can see exactly what they need to sell during the year and at what price. Without this powerful piece of paper, also called a Budget, you’re flying blind.

Resolution 2. Praise more often. Let your valuable team members know that you appreciate their efforts. Everyone wants to get an “atta boy” once in a while and your employees are no different.

Resolution 3. Focus on customer service. This is a key to long term success and will help you rise above competitors who don’t understand how to run professional businesses. People will still pay more for a great experience.Talk to your team about the importance of beating client’s expectations and how each individual on the team can impact this.

Resolution 4. If you’re thinking about hiring this year, hire the best people you can get. Don’t get scared by the higher price tag. Superstars will bring so much productivity to the table that they will quickly earn their keep and more.

Resolution 5. Get the word out! Most remodelers who are succeeding today have increased their marketing budgets from the 1-3% of revenue to 3-5%. Include a healthy marketing allocation in your budget and then track the results. Ask everyone how they found you and then tweak your plan regularly to get the most bang for your buck. If marketing has been on the back burner for years, it’s time to bring it up front and center.

Resolution 6. Make Meetings a priority! Yes, yes, I know that you see your Production Manager every day and talk about projects on the fly but it’s not the same as holding a sit-down meeting during which you eliminate distractions and focus on production issues and opportunities.  Scheduled meetings should be a priority for you and your team.

Happy New Year and I, for one, am expecting 2012 to be a blockbuster!

Cordially,

Victoria signature

For more information on Remodelers Advantage and the array of services they offer to help remodelers build strong, consistently profitable businesses, visit our web site at www.RemodelersAdvantage.com

Posted in Business Coaching, Business Growth, Business Management, Leadership | No Comments »

Tuesday, November 15th, 2011 by victoria

I’ve been talking to dozens of our members over the last couple of weeks and 95% of these remodeling company owners tell me that business is up, backlog is building and they are very optimistic about 2012. This is great news as it means personal income will rise again, profits will be generated and new options will be available. One of the options that business owners will be considering as the market continues to improve, is whether or not to grow the company to an entirely new level.

Below, Remodelers Advantage founder, Linda Case, discusses the challenges and the opportunities that come with significant growth.  Are you ready?

The “When to Grow?” Challenge

This may seem a strange question when so many remodelers have shrunk because of these economic times but there will be a time when you wonder “Should I grow my company?”

Many folks want to know the best way to grow quickly. There actually are a number of routes. You could raise your average job size, which for many companies can be the simplest and least disturbing. You could add a new profit center, increase your geographical area, or just do more of the type of work you already do. Or you could join forces with another company, which can work but may be the most problematic way of all to grow. You are adding the complexity of working with a new partner to the complexity of growth.   Your company cultures may be quite different.  Spend lots of time talking through all the issues of partnership and know that you will still be surprised when some you haven’t discussed, arise.

So the question of how to grow your company is not just by selling more but could also be by selling different or bigger.  You do want to account for the distraction of trying to start a new division – it will take away from your focus on your base business and can be damaging.  So be sure you have those proverbial ducks in a row, have done the requisite planning and “what if” scenarios before you head out to conquer new territory.

Caution Signals

We get asked “What are the caution signals that would say slow down and get your house in order before you grow substantially?”  If you are planning a greater than 10-15% growth in one year, make sure you’ve conquered this list of cautions:

  • Your company does not consistently reach an annual net profit of 5% or more.   A remodeler has to learn the recipe that leads to consistent profitability.  Growing more than 15% will be disruptive (not necessarily bad) and you are unlikely to do much infrastructure improvement while experiencing fast growth so learn to make money before you head out.
  • Your company has poor infrastructure. Your employees are not harnessed to work toward company goals. Accountability is weak. Systems are spotty.  Many times, the company is held together by what is in the owner’s head.  As you grow this will break down with an increase in errors, decrease in profitability and a dropping satisfaction level for clients.
  • You do not have a strategic plan and vision for the business.  You don’t know where you are going.
  • You are not managing by the numbers using accurate P&L’s, balance sheets, job-cost reports, and budgets.  Without these numbers, you will have difficulty spotting trends and keeping your finger on what is working and what is not.
  • You are not using a professional level markup—most likely in the 50% to 67% range resulting in a 33%-40% gross profit to cover overhead and net profit. This markup is what you will need to buy the increased overhead growth will demand and allow for a net profit each year.

Many business experts feel that if you grow without getting rid of the above problems, that your “baggage” will substantially increase your risk of failure.

Green Lights

As your market improves or as your market share increases you are likely to begin thinking about how to expand.  What are some of the signals that might give you a green light to increasing volume substantially?

  • The market is signaling that it will support your growth. You have strong leads and a good backlog of work in the 3-to-6-month range. The economic outlook in your community is bright.
  • Your company is thriving at its current level.
  • A larger company will fit your vision both personally and professionally.
  • You have staff ready to grow, willing to grow, and craving the career advancement that comes from growth.
  • As owner, you can and will delegate. You will be able to see your primary role as coaching the team. You have a key management team in place that meets regularly to work on the business.
  • Your business approaches each new challenge by creating a plan and looking at what the pros and cons of taking that step might be.  You don’t make big impulsive moves that could put the company at risk.

Growth is an exciting adventure into new territory. Just be sure you are as prepared as you possibly can be.

If you are planning significant growth, then be a smart entrepreneur and learn from the experiences of others who have already grown successfully– and avoid the pitfalls that can cost you thousands of dollars and hours upon hours of hard, unprofitable work.

Join the dozens of  savvy business owners who are a part of  Remodelers Advantage Roundtables, the remodeling industry’s largest peer group. Members of Roundtables drill deep into the successful practices of each company and share the best they have to offer. By analyzing hard numbers–the performance metrics of each business–members uncover best practices that drive profitable sales, build strong teams, and deliver the ultimate customer experience. Want to learn how Roundtables can help you?  Give us a call at 301-490-5620 to learn more today. There’s no obligation so very little to lose . . . and so much to gain!  www.RemodelersAdvantage.com

Posted in Business Growth, Business Management, Leadership | No Comments »

PowerTip: Characteristics of Successful Companies

Tuesday, October 18th, 2011 by victoria

Even though we have several weeks still in October, it’s time to begin planning for 2012. We believe strongly that the companies who plan are the companies who are most successful. Just like planning and preparation are the keys to bringing a job in on time and on budget, so are they the keys to a successful company.

Remodelers Advantage founder, Linda Case, and I just completed a seminar on Targetting Profitability at The Remodeling Show in Chicago and we highlighted several characteristics that we see in the most successful of our many members. Here’s our list.

You and all your staff are Committed to “live within the company means.” This means creating a budget and sticking to it!

You have an adequate Markup policy applied to all jobs and change orders. You’ve proven your plan on paper and are confident that your company’s pricing policy will deliver every one of the gross profit dollars your company needs in the coming year. Once you know that the plan is workable, stick to it! Understand that each time you sell a job for less Gross Profit than your plan says you need, you’re taking one step away from a successful year.

Your company has a bias toward Planning before taking major actions.  Like we said above, the companies that plan are the companies that have the most profit, are the most efficient, and have employees that are happier. It’s the thrashing around without a plan that adds stress and anxiety for everyone.

Your company has a proven ability to Implement across the company. It’s fabulous to have the ability to come up with ideas and direction but only if you can implement the tactics that actually bring an idea to life. At each meeting, wrap it up by reviewing the action items, who is reponsible, and the deadline agreed upon.

? Your culture includes Accountability for results on the part of every team member. Give responsibility to your team members and hold them accountable for making things happen. This doesn’t mean abdicating your responsibility — it means training, monitoring, and helping your top team members focus on the most important activities and meet their commitments.

You have built a company culture that embraces Continuous Improvement. One thing I’ve learned since being a business owner is that this is a journey, not a destination. We are always looking for ways that we can deliver more value to our members. You and your staff should be doing the same.

You have key Information feedback loops in place. These feedback mechanisms are typically an array of accurate and timely reports which deliver exactly the  information that helps you make the best decisions for the company. The reports you should be reviewing regularly begin with. . .

  • Profit and Loss Statement
  • Budget to Actual Reports
  • Balance Sheet
  • Marketing Statistics
  • Job Cost Report(s)

And there are many more that you may find very useful. This is just a start.  You may not have any of these available to you now but that shouldn’t stop you from getting started.  To me, the most important starting point is also the most important report you can create and that’s your Company Budget. Without this important planning document, your results will be a shadow of what’s possible.

Start today to embrace your role as a business owner and begin creating your 2012 budget (if you haven’t already).

If you’re ready to take your business to the next level — or if you’re a business owner who’s tired of working alone –it’s time to join a group of smart business owners who are facing the same challenges you are.  Whether you’ve been in the business 20+ years and want to talk business with other experienced business owners . . . or if you’re just starting and want to share with other young entrepreneurs, we have the group for you. That’s the beauty of having the industry’s largest, longest-running peer group for motivated remodeling company owners! Give us a call today to learn how you can join us. 301-490-5620 X106

Posted in Business Growth, Business Management, Financial Management, Leadership, Why Join a Peer Group | No Comments »

Monday, September 19th, 2011 by victoria

Everywhere you look, people are looking at life and business in an entirely new way. We all realize that we have to invest in learning new things to give us the best chance of thriving in this environment. To continue to grow, to realize profits, and to see referrals increase once again, every remodeler should step back and take a fresh look at the business for ways to add value–and then take that message to the streets. Below, industry expert and long-time Remodeling columnist, Linda Case,  shares one interesting way to look at business today. . .

Someone e-mailed me after I used the expression “finding the pony in the manure pile” asking what in heavens name that meant.  It comes from an apocryphal story of why the young boy continued to shovel manure with such enthusiasm.  He was looking for the pony.

It’s similar to the  “making lemonade from lemons” expression.  The economy has dealt us either a manure pile or lemons depending on your sensibilities and the question is how will we view it?  As a tragedy?  As an opportunity?  As a challenge?

There is really no choice.  There’s no need to be a talented fortuneteller to know that there is no way we will return to the “good old days” in the next couple of years no matter who gets in office.  So let’s grab this opportunity to

  • Reinvent our companies by examining our systems to be sure they are streamlined and customer-satisfying. For many companies, the old way of doing business does not fit their new smaller jobs, lower closing rate.  Start with a fresh piece of paper and redesign your company organizational chart and roles for today.
  • Remove or retrain our B and C players so that we can honestly say that we are the A team.  Isn’t that what we as professional remodelers are selling?  There are great people available today looking for great jobs.  Don’t miss this opportunity to rebuild your team with the absolute best people you can find.
  • Sharpen our sales and marketing skills.  Nothing happens in your company until a lead arrives.  You must become expert in the new realities of sales and marketing.
  • Add value to our services by sharpening the pencil of everyone who works on our team including subs and vendors.  Let’s face it, we know this is a difficult competitive environment and we are working in an industry that has been very error-prone and inefficient in delivery of projects.  It’s time to change.
  • Create a realistic plan for 2012 by developing a budget you and your staff believe in.  Hoping it will work is not a plan.  Prove it by putting it on paper.  What is a realistic volume?  What is a realistic gross profit?  What is a realistic overhead cost?  And what will your net be?  Yes, I said net.  Line item everything.

Truth is, it isn’t lemons.  It is a manure pile.  Now let’s use that manure to make that beautiful compost that encourages everything to grow.

If you need help to make the most of today’s reality and continue to provide for your company and your family, give us a call today. For the last 30 years, we’ve helped remodelers build strong, consistently profitable businesses through one-on-one business coaching, our peer group, Roundtables, the largest in the industry, and our variety of educational and training programs. There’s nothing better than working with experienced industry experts to catapult you into a better situation. 301-490-5620 RemodelersAdvantage.com

Contact us today.

Posted in Business Growth, Leadership, Marketing | No Comments »

PowerTip: Ten Marketing Tactics That Work!

Wednesday, August 31st, 2011 by victoria

Everyone has to be smart about generating leads. Marketing is more important than ever and many of us are finding that we have to spend much more to generate enough leads for our business. Below are ten tactics that you should have in place in your business before you do anything else.  If you don’t have them in place yet, you know what to do.

Excerpt from Business Straight to the Heart: The Remodelers Guide to Leadership, Management and Success–the newest book from industry guru, Linda Case.

Ten Marketing Tactics That Work

Every smart remodeler is covered by insurance against catastrophe. But there is one type of coverage many lack. That’s the coverage that assures that the intake pipeline for work stays full. Many, many remodelers give marketing— the insurance that fills that pipeline—short shrift.

We’ve explored planning and tracking your marketing. Today, I want to cover the top 10 marketing outreaches that work. They aren’t the most sophisticat­ed but they work, year after year. I’ll start at the bottom, Letterman-style.

10. Developing an e-mail database and sending to it six times during the year. A small company should have 200 to 300 names, addresses, and e-mail addresses in its database, so be sure to capture e-mails of all prospects, all clients, and all friends of the company who are likely to refer to you. Since e-mail is so inexpensive, you don’t have to cull your e-mail the way you used to when you were using your database to “snail” mail.

9. Association membership. I wouldn’t have thought of this until I heard Steve Dormann of S & D Renovations Inc., a $2.5 million remodeler in Emmaus, Pa., recently tell how his remodeling association membership has brought him 12% of his volume. He listed links to the website, awards, referrals, and more. He obviously uses every opportunity to mine his membership for marketing angles.

8. Home tours. Often, tours are the result of an association’s efforts and they are soft sell and very effective. One remodeler, who had three proj­ects in the same neighborhood, ran his own tour. If you use this tactic, don’t forget security, dust protection, food, and more.

7. Publicity. When you talk about your company, it’s advertising. When your newspaper or your radio or your TV talks about you, it’s powerful third-party testimonial. It’s often inexpensive to engage a local freelance public relations professional to design and implement six stories about you, your company, or your projects over the next year. Don’t forget entering projects for awards and then publicizing the wins.

6. High community profile. Here’s a chance to take what you enjoy—golf, sailing, biking, charitable outreach—and turn it to your company’s advantage. Don’t be bashful and don’t be brash, but let folks know what you do. They’ll put that together with the fact they like and admire you and will call you for their next remodeling project. Also consider semi­nars for the public here. Take every opportunity to meet and greet and to position yourself as “the remodeling expert.”

5. Jobsite presence. Do you have a distinctive sign that shows your crafts­manship and is readable from the street? You might want to include a brochure box—like real estate pros do—on the post. You could also do one, two, or three letters to the 50 to 100 neighbors near the jobsite. After all, you have a “showroom” in their neighborhood. You also have a built-in testimonial.

4. Your website. This used to be an option, but no more. Yes, it is a new kind of brochure for your company with great photos, but it should be informative, should stress your uniqueness when compared with your competition, and should encourage new prospects to contact you.

3. A great image. This becomes particularly important for design/build companies. It starts with a logo and a look—colors and fonts. This includes your signage, your stationary, and your website. It should all be consistent and great looking. Don’t skimp here.

2. Sterling customer service. No remodeler can afford to constantly market for new clients. By pleasing your current buyers, you create friends of the company. Because happy clients tell 3 to 5 of their friends and unhappy ones tell 10 or more (unless they give you a scathing review online, in which case thousands), you are playing an important mathematical game of keeping good words out on the street about your company. Consider everything you do to delight your buyers as part of your marketing.

and, drum roll, please…

1. Past customers and friends of the company program. This is the always­was-and-always-will-be number one marketing outreach. Staying in touch with your past clients and referrers four to six times a year keeps their loyalty strong and keeps them referring you year after year. Vary your contacts from newsletters to invitations to special events. And don’t forget a written thank-you for every referral. Companies have summer picnics, get-togethers, and special perks like Christmas tree cuttings for this expanded sales force.

It’s a tremendous responsibility to run a business on which your family and your employees, your trade contractors and vendors and their families depend. Don’t forget that intake pipeline insurance—your marketing!

If you need business development help, then it’s time to join the Remodelers Advantage Learning Community, a group of motivated remodeling company owners who work together so that all can succeed. Over 300 remodelers are now members. You can be too. Just give us a call at 301-490-5620 x106 to talk about how we can help you reach your business and professional goals. RemodelersAdvantage.com

Posted in Business Growth, Marketing, Sales | No Comments »

PowerTips: Words of Wisdom from an Industry Guru

Thursday, August 11th, 2011 by victoria

I’ve worked with one of the most knowledgeable people in the industry. Linda Case, for over 20 years and it’s been an unbelievable pleasure.   You’ve been reading her column in Remodeling magazine for even longer and if the notes that we receive from readers are true, Linda’s changed many lives with her words of wisdom. Well, Linda is retiring from the remodeling industry at the end of this year and she’ll be sorely missed. However, you’ll still have a bit of her business savvy to help you build strong, profitable remodeling companies. That’s because she’s compiled a fabulous selection of essays on the topics you need most, and this valuable information will soon be available in her new book, Business Straight to the Heart: The Remodelers Guide to Leadership, Management and Success. Here’s a taste of what promised to be another best seller . . .

Are you wondering what you will do “when you grow up”? Are you feeling blah about your business and where you are in life? Do you wonder if there is more (satisfaction? money? free time? balance? fun?) than you are currently experiencing?

No, this is not a commercial for hair implants, little blue pills, or a singles dating service. It is not uncommon for me to work with remodelers who question the direction they have taken in their business lives. So what do I do? I ask them more questions.

This may sound like a fortune cookie, but I’ve learned over the years that the right answers come from asking the right questions. And the right answers come from reaching back to the bedrock in your life (what you love, what you believe, what is really important to you) and then working forward.

Here are some tried-and-true questions that I use to help elicit answers from clients that can point the way to the company that best suits their abilities and lifestyle. You can use them, too. Just be sure to write down your answers so you can adjust and edit them and return to them in order to mine the information they hold for you. To give you some idea of how your answer might look, I’ve provided a few of the answers recently given by a remodeler in his quest for a better fit with his company.

What are your strengths and weaknesses as a person?

What are your strengths and weaknesses in business?

“I tend to take on too much. I over-commit. I fail to follow through….I am sometimes almost visionary. I am particularly creative, resourceful, and a great problem solver. And I have always been exceptional at bringing in business…but not so good at handling it once I’ve brought it in.”

What do you love to do in your personal life?

What do you love to do at work?

What do you dislike doing at work?

“I hate being disorganized or not on top of my details. I also dislike being hectic, particularly because I tend to lose focus when I am hectic and then I can miss important things. I get tired and bored when doing repetitive tasks….”

If you had just the company you want 3 years from now, what would it look like?

How do you like managing others in your business? Are you good at hiring? At coaching? “I like managing. I can be a good coach, and I can tell people hard things, too, when necessary, usually in a productive way. I do, however, need a good structure to make sure I follow through on all of the details….”

What kind and size of projects please you the most?

What kind of clients (including education level, finances) do you prefer working with?

Do you read business books? How many in a year? If so which have been your favorites?

Do you read trade magazines, trade books, etc.?

How do you view the importance of finances in your company? How do you judge if you are doing well or poorly financially?

“It’s as if I have had blinders on these last 6 years. All I paid attention to was the checkbook balance, my billables, and what I was able to draw out as take-home pay….I understand that to move forward I must discipline myself to pay close and regular attention to the P&L and the balance sheet….”

Each of us can design a company that complements our goals and talents. It takes stepping back, analyzing what is working and what is not, assessing our strengths and weaknesses, and then building a company where our strengths are maximized to their highest impact and value—and one where we love what we do and what we deliver!

And More Questions….

The following is the quickest quiz you’ll ever take. It will take you approximately 10 seconds. If you can answer “yes” to the following three questions, you don’t need to read any further. Pat yourself on the back, for you are a success in business. However, if some of your answers are “no,” keep reading.

1. Do you make a good salary and a net profit that compensates you for the risks you take as owner?

2. Do you work 50 hours a week or less in your business?

3. Are you generally happy in your business?

The last question is undoubtedly the most important but is usually dependent on the first two. So let’s start with money.

1. Can a remodeler make both a good salary and a healthy net profit of 5 to 10%? Absolutely. Is it easy? Not particularly. But it’s not easy to be financially successful in any field. After working with thousands of remodelers, I have learned that turning this critical area around starts with convincing the owner that there is no use staying in their business if they can’t make adequate money (the “stick”) and showing them that others no brighter or more talented than they have conquered this problem (the “carrot”).

This is an excerpt from Chapter 1 of Business Straight to the Heart: The Remodelers Guide to Leadership, Managment and Success.  The book is in production and will begin shipping in mid-September.

To tap into more of this knowledge and insight,  join the community of successful remodelers and array of industry experts who are all a  part of Remodelers Advantage. Over 300 remodeling company owners and staff have experienced the difference Remodelers Advantage can make.  Click here to contact us today and see your life improve tomorrow!

Posted in Administration and Human Resources, Business Coaching, Business Growth, Business Management, Leadership | No Comments »

PowerTip: Take Charge of Your Online Reputation

Tuesday, July 26th, 2011 by victoria
  • A Virginia design/build remodeling company learned that a competitor had registered seven “lookalikes” of the company’s domain name. The only difference was that the legitimate company’s URL ended in .com, whereas the lookalike URLs ended in .net, .org etc. and were directed to the competitor’s site.
  • A California remodeler checked out its profile on Yelp!, where it had 20 homeowner reviews. Unfortunately, only three remained visible — and these happened to be the three negative reviews.
  • A Georgia remodeler found his company in the humiliating Angie’s List “penalty box” after receiving an F rating from one disgruntled client — despite five years of steady A ratings.

All three incidents, reported on daily5REMODEL by  Leah Thayer reveal the growing challenges remodelers face in managing their online reputations. More remodeling searches are taking place on the web, and ratings sites and social media platforms are proliferating. Increasingly, projects and money are at stake if your image comes across poorly — or if prospects trying to find your site are directed to another site.

Here, Leah shares several concrete actions you should take to minimizing the risks of potentially damaging content about your or your business.

Know where you stand

Type your name, your company’s name, your employees’ names and so on into online search engines. In the event that the unflattering or inappropriate content was posted by you or the employee — say, updates from an employee’s personal Facebook page — have him delete it or adjust his privacy settings.

Get on it quickly

Google Alerts is probably the most widely used tool for free web monitoring of when your name (or any other search term) has appeared online. Don’t wait for someone else to bring a potential embarrassment to your attention.

Overwhelm the negative with positive

If you can’t remove a negative post, you can try to reduce its visibility by publishing new, positive content that will push older items down in a search. Your social network profiles can be a big asset here. Profile pages on LinkedIn, Facebook, Twitter and the like often show up high in searches, so keep them current and positive.

Use the complaint process

If you find that another company is using your name in web searches, you may have legitimate grounds for a complaint. Here are links to the forms for the major search engines:

Respond quickly and professionally to negative reviews

Ask your good clients to post fresh, positive reviews on the sites they use. Make this easy — email requests to them, with direct links to the appropriate sites. Be classy, be positive, keep your chin up.

Register alternative domain names

A number of steps can help you establish a basis for recourse against abuse of your name. Register URLs that are similar to yours, or might be typos, abbreviations or synonyms for it (e.g., JonesRemodeling, JonesRemodel, JonesRemodeler, JonesRemodleing). Consider “geolocal” URLs, like SouthParkRemodeling.com. Have those domains redirected to your site.

Also consider registering your personal name as a domain.

Trademark your name

You can place a TM next to your name, logo and/or slogan at any time, even without registering your trademark through the U.S. Patent & Trade Office. Even without a federal trademark registration (which allows you to use the ® for registered), you can establish rights in a trademark based on your use of the mark in commerce. 

Reach out to the source

If a negative review is false or unjustified, don’t be afraid to go directly to the review site. It might not get you satisfaction, but it can’t hurt. The remodeler whose longtime “A” rating on Angie’s List was jeopardized by an “F”? His company was later featured in a glowing article on the site.

If you’re ready to take your company to the next level of success, join the best remodelers in the business — the members of Remodelers Advantage. Contact us today and have a better life tomorrow.  Click here to contact us.

Posted in Business Growth, Business Management, Marketing | No Comments »

PowerTip: Do You Know What You Are Selling?

Monday, July 11th, 2011 by victoria

The last issue of PowerTips was warmly received so I’ve asked Ted Dubin, our Director of Business Development, to continue on the subject of Sales.

Ever wonder why you make what seems to be a great presentation but the clients don’t buy?  Perhaps you haven’t told them the Benefit of buying from you!  Here’s a solution, presented by Ted Dubin, our Director of Business Development.

What Are You Selling?

What do you sell?

Wood and Tile?  Sinks and Tubs?  Windows and Doors?

Rooms and Additions?  Kitchens and Baths?  Drywall and Paint?  Decks or Basements?

Design-Build Services?  Handyman Services?  Property Management?

The Finest Materials?  The Most Experienced Craftsmen?  The Best Reputation in town?

No.

You sell and deliver The Remodeling Experience.  And the feelings that go with the Experience.

Sell the Experience

How ready are you and your staff to deliver a great Remodeling Experience?

OK, well the first part of delivering the Experience is SELLING the Experience.

What should you, the Sales Pro, say to prospective clients to differentiate yourself from those Remodelers that don’t even think about the Experience?

I’ve seen the answer explained many different ways.  I best understand this concept by envisioning it in 3 distinct parts:

Feature->Advantage->Benefit

The Feature explains what it is, the Advantage explains what is does and the Benefit tells everyone why they need it.

Most of our PowerTips readers are awesome craftspeople. They do great work using the finest materials.  Unfortunately, many are not yet Sales Pros.   They are almost always thinking in terms of the project without envisioning how their presentation is received by the customer.  Many will go through an entire sales or design appointment without ever mentioning the actual benefit of working with them.  This is a huge mistake that costs money through lost jobs, frustration and wasted time and leaves even the best contractors open to price competition.

No One Cares

To begin to Sell the Experience you must first internalize this fact: No one really cares what you do or how you do it!

What matters to people is how it benefits them in the end.  “We use high-quality materials!”  Who cares?  “We’ve been in business 30 years!”  Who cares?  “We seal and insulate everything and only install the finest windows!”  Who the heck cares!  Without more information these are meaningless phrases that waste everyone’s time and attention.  The only thing that matters is the Benefit.

Big companies know and practice this already.  Remember the Toyota ad slogan “Oh, what a feeling!”?   Toyota went right to the important part of the pitch: the feeling you get when you buy their product.  They didn’t waste time on “Toyota, Oh, what great light-alloy engine blocks!” or “Oh, what efficient manufacturing!”  They went right to what’s important to the purchaser – the Experience.

Think about other commercials you’ve seen.  Campbell’s Soup?  Why, Campbell’s Soup is “Mmm mmm good!”.  You don’t hear “Campbell’s Soup is chicken, flour, salt and a few veggies in a can!”.  Sometimes the actors in commercials for major consumer companies almost look like they’re having a party while using the product – think ladies shampoo or soft-drink commercials.   I especially love those men’s razor commercials like Gillette’s: you learn about how the razor has 5 blades (Feature) which shaves you extra close (Advantage) but, near the end, there’s always a nice lady making admiring glances at the guy using the razor (Benefit – Oh boy!). You get the point.

So, what is the real benefit of going through the “Remodeling Experience” with you? Does your client get a great feeling of pride and satisfaction?  Peace of mind that their house is strong and secure?  A warm, cozy environment to raise their family in?  You need to figure this out NOW so you can explain it explicitly to your clients if you want to succeed as a Sales Pro and stand apart from the lesser companies out there.

How to Apply This to Your Business

So, when you’re making a presentation to prospective clients, how do you know if you’ve gotten to the Benefit?

There is a 2-word test: the “So What?” test.  If the person you are pitching can ask you a “So What” question, you haven’t presented any compelling Benefit:

“We keep the jobsite clean.” OK … So What?!

“We seal and insulate everything.”  OK …So What?!

These statements are meaningless unless you tell the rest of the story.

When you present to your prospects make sure you go all the way through to the Benefit:

“We keep every jobsite clean so your home is orderly during the process which means you don’t have to worry about a mess or your family’s safety.”

“We seal and insulate everything which will keep the room is cool in summer and warm in winter so your family will always be comfortable”

More:

“We use the highest quality materials (Feature) so our work stands up to time and the harshest weather (Advantage) which means you never have to worry about your home (Aha! The Benefit)”

“We’ve been in business 30 years (Feature) which shows we’ve got lots of experience and many satisfied clients (Advantage) so you don’t have to ever be concerned about the people you let into your home (Benefit).”

Your Task

Figure out what it is you REALLY sell, then, make a Feature, Advantage and Benefit chart. Use the list to test-pitch someone else – a staff member or friend – and have them ask you “So What?” till they can’t anymore.  Once you’ve figured out what you really sell, Practice, Practice, Practice!

If you’re interested in improving your selling skills– a necessity in this economy–join our experts and a small group of your peers in a Strategic Action Group. Seats are limited so reserve your seat today!

Becoming a Great Salesperson or Get Rid of the Tire Kickers. . .  and Get the Work You Want!

Posted in Business Growth, Sales | No Comments »

PowerTip: Sales Tips to Give You The Edge

Friday, June 24th, 2011 by victoria

We constantly hear about Remodelers making proposals to prospective clients only to be undercut on price.  Here is the solution, presented by Ted Dubin, our Director of Business Development and in-house Sales Trainer.

Creating the Need

As Victoria mentioned,  one of the most frequent topics of discussion in our conversations with Remodelers is the issue of price competition. Our Remodelers Advantage members are constantly presenting their best proposals to prospects, then shortly thereafter, finding out that the prospective client has found some outfit that promises to do the work for a lower price.  Sometimes you don’t even get to make a true proposal because you immediately hear “xxx can do it for less”.  There are situations where you know the other guy’s quote is so low that they can’t even buy the proper materials for the price they’ve quoted, much less perform the work.  Other prospects decline to move forward because the cost of the project they’re asking for is more than they expected.

You know you do great work, you know you’ve priced the remodeling work fairly and you know you can’t lower your prices beyond a certain point or you’ll go broke.  What you need to learn is to sell and compete on value, not price.

Price is not the object

People don’t buy price, they buy value, from the person or company they perceive as most likely to deliver the best value.

Don’t believe this?  Look outside in the parking lot .  All types of cars are out there, but very few, if any, are the cheapest model available. Why doesn’t everyone buy the cheapest car possible?  If you can get a new car for $10,000 then why do people purchase more expensive vehicles?   People buy products and services based on their expectation of the product or service’s ability to deliver what they need.

It’s the same in the Remodeling industry.  No one brags to their friends or family  ”Nice job, huh? I went with that company because they cut the price of my new toilet $5″ or “They discounted my lumber $500″. They say “I went with them because they really seemed to care about the needs of me and my family” or “I went with them because they really took the time to understand what was important to me”. But, if you haven’t educated your prospects properly and helped them discover their true needs and desires, they will always go for the lowest price.

Now, you say “Yeah, I’ve heard this before.  I deliver a great value but nobody cares”.

You need to show the world why they should care.  Prospective buyers will always purchase from those best able to explore and draw out their wants, needs and desires.  The problem is too many Remodelers are, by nature, terrific problem-solvers. They just can’t wait to show the prospect the great design they’ve come up with and get started.  Unfortunately, simply proposing your great design solution is not enough.  If you show your product to your prospect before you’ve helped the prospect discover the need to buy from you then you’re just wasting your time. You’ll lose out to the first competitor that promises to do the work cheaper.

How do you teach your prospects that you will deliver real value and convince them that they should work with you instead of any other firm?

Asking your prospects open-ended questions creates the need to buy only from you.

Why I paid $3000 for a pebble and was happy about it

Let’s illustrate with a real-life example:  Years ago I wanted to buy an engagement ring.  So I did the natural thing and went to the mall (lots of jewelry stores at the mall, right? So I’m sure to get the best price).  I went into the first store and announced “I’m here to buy an engagement ring”.  The clerk went to a display case, opened the case and took out the little velvet tray with diamond rings on it.  Of course, like most jewelry stores, the price tags were upside-down.  As the clerk stood there (silently) I flipped the first tag – $1500? No way!  I thanked the clerk and left.  I proceeded to the next store where the (also silent) clerk opened his case, took out the tray (with the price tags upside-down) and laid it on the counter.  I flipped the tag – $1750?  That’s even more than the last guy.  No way!  I left that store too.

I went to a third store and announced my intention to buy an engagement ring.  The gentleman running this store did NOT take out any merchandise.  Instead he asked me “What do you know about diamonds?”.  I told him I really know nothing about diamonds as it’s my first time buying any jewelry of this type.  He then spent the next hour teaching me about diamonds (you know: the 4 “C’s” –  Color, Cut, Clarity and Carats. I still remember this 20 years later).  He asked me lots of open-ended questions such as “What kind of style does your fiancé enjoy i.e. traditional or modern” , “How often does she wear her other jewelry?”, “What sort of work does she do?”, etc.  We then looked at an assortment of diamonds through a loupe (a jeweler’s eyepiece).  He showed me diamonds of different colors vs. pure white and an assortment both with and without flaws, all the while asking me “How do you feel about flaws in the diamond?”, “How close to completely white do you think your ring should be?” and “When you buy the ring how do you want it sized?”.

Only when the jeweler was thoroughly convinced I was really feeling the need to make a great purchase did he bring out his merchandise.  By working with me he was able to say “Here’s what I recommend”.

I bought from him.  The ring I chose cost $3000, twice as much as the competitor’s price in the store that I walked away from as too expensive.  And I was thrilled!

Equally important, here’s what didn’t happen:  I didn’t try to bargain because I now understood I was getting a good value.  I didn’t walk away and try the next store.  And, I didn’t go back to the first 2 stores and try to comparison-shop.  No, this was “my guy” and I was buying from him and only him.

How to create the need for the prospect to only buy from you

Remember, unless your customers understand value, they’ll see it as their duty to select the Remodeler with the lowest bid.

You must ask a series open-ended questions BEFORE you make any product presentation.

As a refresher, open-ended questions are those that cannot be answered by a yes or no.  Open-ended questions begin with “Who, What, Where, Why, How” and “When”.  These questions make your prospects think before answering.  They naturally lead to further conversation.

Think back to the jeweler in the example.  Now, apply this to your Remodeling business.  Do you work on kitchens or baths?  OK, ask your prospects “What do you know about how cabinets are made?” or “When you choose your faucet, how long do you want it to last?”, then explain your use of only superior products from reputable suppliers.  Building an addition?  Ask “How will you and your family use the room?” or “What do you know about framing?” or simply “How do you want the room to feel?”, then sell your expertise at great design and solid, weathertight construction.  Set up the opportunity to sell your better-than-the-competition practices: “When the work is in progress how important is it that the crews maintain a clean environment?” or “How important is the reputation of the company you choose to work on your home?”.

Every good Remodeler should have at least 30 open-ended questions ready to ask without hesitation.  Of course, you’re not going to use all 30 in every meeting.  But a few smart questions asked with confidence will make the difference between trying to justify your bid against a lower price and  making magic happen with your clients.

When do I ask these questions? Again, after you’ve qualified the prospect to make sure they can buy what you’re envisioning but BEFORE you present your proposal.  NEVER make a presentation until you’ve firmly established in the client’s mind that they need to buy only from you.

Your Task:  Develop a minimum of 30 open-ended questions that demonstrate the value of your company and its great work to prospective clients.  Practice so you can deliver these questions with confidence.  Keep a list of what works best for you.  And, use the questions you’ve perfected with every prospect every time.

Watch your sales increase and your price competition evaporate!

If you’re serious about improving your selling skills, join us at the Remodelers Advantage Community Meeting this September 26-27 in Austin, Texas. Seats are limited so reserve your seat today.

Posted in Business Coaching, Business Growth, Sales | No Comments »

PowerTips: What Sales Managers Measure

Tuesday, June 7th, 2011 by victoria

At a recent meeting of one of our Roundtables peer groups — this one with owners of companies producing over $5,000,000 annually — I participated in a rousing discussion of the techniques and procedures used in managing sales successfully. As you can imagine, once a company reaches a high volume, using a proven, effective sales process is even more important than it is for smaller companies.

For one thing, rarely can the owner continue to be the only sales person. Typically, there are 1 to 4 additional salespeople on the team. To maintain the company’s reputation and to make measurement more effective, all salespeople should follow the same solid process. Secondly, the company must maintain this volume to cover expenses and profits, therefore, they need measurements that a process provides to see when and how to turn up the volume on marketing and sales efforts.

Two parts of the discussion were particularly interesting to me. One focused on the metrics for measuring success, and the other focused on the steps in the process — or the Sales Pipeline.

First, measuring.  All of these savvy owners agreed that results–projects and dollars sold– is the ultimate measure. But what else is measured regularly? Close ratios are also no-brainers: the ratio between qualified prospects and design contracts signed (if applicable), the ratio between design contracts and construction contracts, the ratio between leads and appointments. Comparing these among salespeople can quickly uncover weak areas — and then you can train for improvement.

Plus, many agreed that the best managers also measure the activities that create sales. If a salesperson is participating in sales generating activities, it is reasonable to expect that they will have better results, right?

During the Roundtables meeting, owners worked together to develop a list of activities to measure weekly or monthly. Here are just a few.

  1. # Leads self generated — Prospecting and yes, I believe all salespeople should self-generate some portion of their leads.
  2. # of Referrals self generated–Ask for the referral!
  3. # of networking activities attended.
  4. # of calls to previous clients.
  5. # of visits to architects and/or interior designers (if applicable)

I’ve seen this process in action. Several years ago, we took three of our top Roundtables Groups to visit a highly successful remodeling firm in the Northwest. During the process of learning about the operation, the owner of this high-volume company showed us a chart. On one axis were the names of the sales representatives. On the other axis was a long list of activities that were available to the reps. This list included working the showroom on Saturdays, presenting educational seminars in the showroom, attending networking events, sending out a personalized newsletter to their contacts and clients, and more.  The results of the chart clearly showed that the sales reps who participated regularly in more activities had greater results — a higher sales volume. If you’re not measuring activities that drive sales, you should be.

What sales metrics do you measure?

Next PowerTips, we’ll discuss the Sales Pipeline.

Posted in Business Growth, Business Management, Sales | No Comments »

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