How You Avoid Being a Commodity Contractor.

This is a follow up to last weeks, commodity contractor blog post.

I had the pleasure of having coffee with a very wealthy client that turned into a very expensive lunch and great conversation. Luckily, he paid.

Somehow our conversation between two men took a drastic turn when the topic of Nordstroms started. We have a local Nordstrom in Tampa that his wife was shopping at while we had coffee.

The only thing I knew about Nordstrom is they sold higher end clothing/shoes and to keep my wife away.

I asked, "Why does your wife like Nordstroms"
His answer was priceless, "My wife can spend hours in that store, they have a personal stylists that assists her every step of the way. She likes the layout of the store, very open and welcoming. She earns points on her Nordstrom Card toward future purchases. She goes to the other stores Neiman Marcus, and Saks but, really goes back to Nordstrom for the personal touch. Lastly, the stylist will call or email when they have new arrivals that fits her style."

I would typically space out while another man talked about a department store. I found myself asking more questions. I was curios to see buying habits of higher end customers. Customers that could choose to shop wherever they wanted but, found themselves spending thousands of dollars in one store.

My findings and how they pertain to Contractors:

Nordstroms has 5 competitors in the market place. They have carved a great niche with high end and personal services. The wide open store layout invites customers to freely walk through the store and take in everything Nordstroms has to offer. Lastly, the return policy is 100% Guarantee.

Enough about Nordstroms.

Ways not be a commodity and more like Nordstroms:

1. Position yourself as the expert. If you are the best at what you do, you dont need to talk about being the best. Show your expertise with articles, and answering questions on community dashboards. Highlight your projects through social media and be open to answer questions and let prospects freely look around.
2. When customers arent asking for your bid or price, but when they can get on your schedule. Welcome to the Nordstroms experience. You are the contractor they want and will wait until your avialable.
3. Your 100% satisfaction Guarantee. Offer that longer warranty, your business uses better materials and trades. Extend the guarantee and warranty.
4. BONUS. Stay in touch with your customer. Thank you card or pictures taken during their project with personal note from you. Bottle of wine with your label. Anything that keeps you top of mind.

Creating a higher end niche keeps you out of price wars. Spending more time on higher end will garnish higher profits and better referrals. How do you want to spend your time price wars or profits?

Want to know more about selling to higher end? Call me or send an email.

Justin 727-644-0160 or Justin@ContractorsNetworking.com

Are You A Commodity Contractor?

Are you a commodity contractor?

I was recently asked my niche in the local market. I explained what I do better than anybody else. Then I proceeded to explain why I do it better than anybody else.

The prospect I was talking with called 8-9 companies and told me they all sound the same. The ones that did call back, I cannot differentiate between any of them.

I simply told the prospect, I cannot help them. You will waste your time and everybody else searching through these commodity contractors.

I had an AHA moment just then.

DO you have that awkward moment where the prospect asks "What company are you with again"?

Sometimes I want to hang up the phone and other times I say my name and company.

If you cant create a distinct difference between you and other contractors, you are a commodity contractor.
How do I know if I am? Here are some examples:

1. If you constantly lose jobs to price. COMMODITY
2. If your marketing is exactly the same as competitors. COMMODITY
3. If you strive to be the lowest, and brag about all your jobs. COMMODITY
4. If your telling your team to wait and cash their checks...DRUM ROLL....COMMODITY

If your stuck and cant figure out how to get out of the rat race, I can help call me.

If your ready to increase leads and profits, email me.

If this sounds like your business. Call me or email: Justin 727-644-0160 or heavenly.foundations@gmail.com

Is Price Per SQFT Coming Back?

I drove by this sign last week while riding from Pinellas to Hillsborough. The big debate was going through my head.."Do I call this company and tell them to up their prices..or...Do I call them and remind them price per sqft ended in the 80's"

I figured I would just write to everyone and get some opinions.

For those of you who don't know price per square foot, I will give you a little back story.

During the good old Reagan years when interest rates were 18+% builders had several different home models, these models came with limited choices and could be figured out by the sqft price instead of calculating in all the different trades and selections. This was great for buyers that would pick A,B, or C.

In today's world with all the different choices, price per sqft doesn't work. Prospects will still try to ask about the sqft price and good contractors quickly explain.."It doesn't quite work that way..."

My local market, Tampa Bay Area you cant build for $90/sqft and make a living. Not possible, if I had to figure out per sqft on my last couple of deals, the median would be around $144.

Please tell me what I should do in this situation? I dont want these guy bringing this back to my market..

Are You Selling What People Want?

In my everyday business I run across a lot of people who think they know what they want. In truth, they have no idea.

I recently polled all my current jobs and the past thirty jobs completed. I had two customers that knew what they wanted. Two out of Forty, Approximately 5% knew what they wanted.

My question to you, how do you know your selling what people want, if only 5% know what they want?

Do you sell your products? Do you sell what you think they need?

My formula to make sure your selling what people want:

1. Sell based on results. (This is my secret sauce.) 
• Listen to what people want. 
• Reiterate to them what they want. 
• Add your professional opinion and thoughts. 
• The customer will get what there asking for and you add value by giving a professional opinion to re affirm the customers choice.

Defining Your Target Market or Following Competitors Target Market?

This is a follow up to Rock Star Contractor Mindset from 1/31/14.

I grab the mail every week to look at competitor ads. Over the past 3-5 years there has been a National company that advertises windows. Specifically any size window for $189.00 installed. I am sure you'll have seen the ads or commercials. I don't know how they can make money at $189.

Shortly after this $189 phenomenon, I started seeing competitors (Mom and Pop Window companies) trying to compete against this large national brand. The Mom and Pop companies didn't do the research needed to sustain. They started to go after this low hanging fruit and mimic the advertisement only to find out there is no pot of GOLD at the end of the rainbow. Unfortunately, this still happens today in 2014.

My 3 suggestions:

1. Take notes on competitors for ideas, dont copy there advertisements.
2. Find your unique selling proposition. The large national brand above can install any size window for $189, that is unique. 
3. Look at other industries for some ideas on how they target market. Some of the best ideas come from industries outside of Construction. Also, these companies outside of Construction aren't threatened when you call for questions.

The Mom and Pop's didn't last very long in the $189 arena and some went out of business. The others that made it through for little margins are glad to still be around.

Please leave a comment below.