It's not necessarily an easy process identifying and marketing to your clientele base. It can also be difficult to determine whether or not a customer's project and expectations are a good fit for you and your company.
During the middle of the economic downturn, I considered taking on a pretty significant project that had some challenging aspects. I thought it would be a good fit for my company, Westbrook Restorations. After talking with the owner and going through the requirements of the project, I felt comfortable enough to give him a verbal estimate. After we talked for a while longer he leaned in and whispered, "So, what's your cash price?" I was shocked!
The reality is: A contractor's business overhead, payroll, taxes, and marketing do not decrease based on method of payment. Unless you're cheating on your taxes, there's no way. This is one example of when the project seemed to be a good fit, but the client was not. I would have had to put myself, and my business, at risk to meet his expectations. A contractor choosing his or her customers is just as important as a customer choosing a contractor.
So, how do you choose the best customers for your business?
- Identify what areas are your business' specialties. What's your service area? Do you remodel, or build new homes? Do you specialize in kitchens, roofs, etc.? Do you focus on commercial, or residential?
- Identify what kind of services you provide within the framework of the type of work you do.
- Identify the level of quality and expertise that you want to provide.
- Identify the costs of running your business and what you need to charge to make your business profitable.
You should ask yourself these questions on an ongoing basis. A good contractor is constantly refining his or her business.
Understanding yourself and your business will help you identify which clients are a good fit. Then you can market to the types of projects and people you're best suited to serve.
At Westbrook Restorations, most inquiries we receive for potential projects are a pretty good fit. There is a next step: Identify if that potential client can communicate their expectations and is excited to develop a cooperative working relationship with you and your company. Business is more relational than contractual, especially when you're dealing with a scenario as personal as people and their homes. The only way to do this is to "interview" your potential client to see if you are excited about working with them as well.
You may be asking: "What do you mean, 'interview' a potential client?" Don't ask for a resume—it's nothing more than asking the right questions. For instance: Are they on a budget? Is that budget reasonable for the project they want completed? I also try to establish a rapport with people. I look for things like: Are they listening to my advice? Are they putting me down or disrespecting my business or pricing? Are they excited about their home and the project? Do they have an understanding of a reasonable budget for the project? Are they willing to work as a team, make decisions, and communicate well? Are they bid shopping solely for the lowest price, or looking for a contractor they can trust? Do they know the difference between a good value and cheap price?
Many of these questions can be answered in just a few meetings, and the answers will ultimately help you decide either to make a sale, or politely withdraw yourself from the project.
