Sell More Than Low Price!
Have you ever been low bid on a construction project and didn’t get the job? It doesn’t seem fair. Why did it happen? What can you do to avoid this happening again in the future? Bidding more and more jobs won’t guarantee a steady flow of profitable work in today’s tough competitive economy. Successful contractors and subcontractors have learned that bidding is only one step in the sales cycle. Pro-active customer relationships and an organized and consistent steady marketing and sales program is required now more than ever. Look at your suppliers. They know how to market. They have dedicated full time sales people assigned to your account. These sales people call on you on a regular basis, take you to lunch, and make sure you’re getting what you want. They spend at least five to ten percent of their sales volume to insure they keep a continuous flow of orders coming their way from you.
Look at your company’s financial dedication to sales, marketing, and taking care of customers. When the business was booming, all you had to do was bid enough jobs. That doesn’t cut it today. Now it takes a commitment to business development and a thorough understanding of what your customer wants on every job. This program costs more money to implement. But without spending money to make money, you’ll have nothing to offer except lower and lower prices to win less contracts.
Most general contractors bid several construction jobs every month. For every job they bid, they usually receive about 100 subcontractor bids for the 30 sub-trades involved. What amazes me is how most subcontractors rarely ever call to discuss the project requirements prior to bidding. And then never ask to meet with the decision maker to present their bids. How can only turning in prices give you a competitive advantage and improve your bid odds? When general contractors don’t hear from subcontractors before, during and after the bid date, they can only assume they’re too busy to help or don’t have anything valuable to offer except their price. Don’t you think meeting with customers will make a difference? Face to face sales gives you an opportunity to negotiate, builds relationships, develops trust, and a improves the desire to work together.
Do you sell more than price?
Customers demand and expect more than a cheap price today. And most contractors and subcontractors are proud of their quality work, reputation, expertise, and customer service. But, if your potential customer isn't aware of the added value you can offer, he or she can only evaluate your proposal based on price. Your written bid looks very unconvincing stacked up against five or ten other bidders. The only differentiating factors are the prices, inclusions, and exclusions. Is that the only factor you want your company to be judged on? Don’t you think you could do better if you had a strong enough relationship to get a meeting with your potential customers and discuss how you can make the job go better, faster, easier, or safer?
As a construction business coach, I see thousands of different construction companies in all parts of the country and have learned many ways to improve your bid odds. To get a copy of ‘BIZ-DEV Action Plan Worksheets, email GH@HardhatPresentations.com. Take a look at what the top 10% best in class and profitable construction companies use to sell more than low price:
- Written marketing and sales BIZ-Development plan
- Marketing budgets from $10,000 minimum to $40,000 or higher
- Pro-active customer relationship follow-up programs
- Consistent monthly mailings to target markets
- Constant customer reminders of project niche expertise and specialties
- Sales training for all estimators, project managers & sales people
- A systematic referral networking system in place
- Key managers are very active in their industry and community
- They never bid a job without meeting the decision maker first
- They always ask what’s the most important factor in awarding a job
If you want to sell more than price and improve your profit margins, you’ve got to offer more than a low price on a piece of paper. You must do something to convince customers your company is the best choice. This must be done with a pro-active systematic approach to selling that goes on all year. Take your customers to lunch or a ball game. Send them something that shows how you helped another customer finish their project faster. Ask them how you can help them make more money. Send them a handwritten note thanking them for the contract or the opportunity to bid their work. When you make your bid only one small part of your complete selling process, you’ll begin to see real bottom-line and top-line results.