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Now Might Be a Good Time to Remodel How and Why You Do Marketing

Posted by Shawn McCadden on Tue, Jun 16,2015 @ 10:03 AM

Now Might Be a Good Time to Remodel How and Why You Do Marketing

marketing ideas for remodelersOn April 2nd, 2015 I presented a half day marketing workshop titled "Choosing and Targeting the Right Customers and Projects Types for Your Business". The workshop was billed as the keynote session for the Builders Association of the Twin Cities (BATC) annual trade show in Minneapolis.   At the workshop I shared new ways contractors can think about and do their marketing so they can attract their desired customer and job types. It’s what I call strategic marketing.   For those of you who missed the workshop here are some of the key points we discussed at the workshop.


BATC Builders and Remodelers Show information Take advantage of the timing 

The economy and residential construction are both picking up.  At the same time the majority of attendees agreed with me in that we are not yet confident that the pace of the current surge will be sustainable considering the uncertainties businesses and consumers still have about the economy.  With that in mind this is however a good time to take advantage of the surge to concentrate on developing market share in a strategic way.  It’s my opinion that most contractors would benefit from becoming a specialist in what they do and how they do it.  After all specialists typically command higher prices than generalists.  And, true specialists are always in demand, even in down economic times. Now is a good time to specialize, as long as you also work on branding to establish and maintain your position as a specialist in your desired market areas.


Here are some specific tactics contractors can consider and use to strategically build market share

Pick your customers, don't let them pick you:

marketing strategies for remodelersStop taking just any customers and jobs.  Be selective about who you will let become your customers.  For example why not only work with people who would say they are "working with" you, not those who would say you are "working for them".   Also, be selective about the project types you go after.   For example why not attract people who want high quality products.  If you sell using one markup across all cost categories the gross profit dollars earned on material intensive projects due to higher price point products is an easier way to meet overhead and net profit goals, both now and in the future, particularly when compared to selling and producing labor intensive projects.

Stop competing, differentiate:

I don't understand why contractors think they have to compete and or be competitive.   For most construction business owners competing means bidding. Home owners who seek bids are typically like auctioneers, except they are looking for the lowest price, not the highest.  And, rather than try to be better than your competition, why not seek to be different from your competition.  Being different attracts attention and consumers who want different also know they have to pay more to get different.  
One key to being different and attracting positive recognition for it is to concentrate on how you do what you do to demonstrate your difference, rather than work on what you do to differentiate.  One example of potential differentiation could include offering true Design/Build as an alternative to the traditional design-bid-redesign and bid again game. Another example would be helping prospects develop project specifications with the agreement that you will come back to present your proposal and solutions, but you will not leave them behind unless they sign your proposal and give you the required deposit.  


Being different comes with pros and cons

If you decide to use these example strategies many prospects will go away.  However, the ones that see value in your differences will become cogs in your new referral generating machine and will pre-sell the value of your differences to their referrals so you won't have to.  I call those types of referrals "layups".


Think of how you do marketing in a new way

marketing for remodelersThe old traditional marketing methods of trying to find prospects who want your services now and interrupting them to get their attention no longer work.  Today consumers are the ones deciding how they will find and qualify their project ideas as well as the contractor they will work with.  Instead use inbound marketing tactics that help consumers find your business.  This should be one of the two primary purposes of your marketing and can be accomplished on your web site using SEO tactics and good content on your site’s pages as well as your blog.  The other primary purpose of your marketing, particularly at your web site, should be to help prospects decide if what you offer and how you do business are right for them.  In other words your marketing should help them prequalify themselves so they either want to contact you or know they shouldn't.


Final Thought- Marketing shouldn't just be limited to creating leads

At the workshop I also shared one more new way to use your marketing; to advance the sales process.  Consumers want to gather information and ideas about their project, but they want to be sure they are getting accurate and useful information.  Savvy contractors are now using the content at their web sites to educate consumers before they call to setup an appointment with a contractor.  This saves both the prospect and the contractor a lot of valuable time.  In addition to offering project and product related information, you can also educate them about how and why you do business the way you do. Sign up to join our mailing list  This can not only speed up the sales process, it can also help clearly differentiate your business and therefore improve the quality of your leads.



Topics: New Business Realities, Contractor Training, Success Strategies, Sales Considerations, Differentiating your Business, Marketing Ideas, Web Site Related, Marketing Considerations, Customer Relations, Business Planning

How You React To Your Own Frustrations May Set The Example For Your Team

Posted by Shawn McCadden on Wed, Apr 15,2015 @ 06:00 AM

How You React To Your Own Frustrations May Set The Example For Your Team

Frustrated construction business ownerDealing with customers, subs and employees isn't always easy. All too often they can say and do things to us that can really strike a nerve.   How you react in the situation can really make a statement about your professionalism as well as what they might actually share with others about your reactions.

Besides the people who get your goat others may be observing your reactions as well.  The observers may include your employees, trade partners as well as your customers.  How you react to stress and frustrations will definitely leave a lasting impression on them.

Consider these examples

If you beat the snot out of a chunk of wood with a sledge hammer as a way to cope with frustration and or stress your employees will likely think it’s ok to do so as well.  What if after seeing you do it they are frustrated by a client the next day , go out to the back yard of the job site and do the same in view of the customer?  What will the customer be thinking and how might it affect the atmosphere on the job site for the rest of the project?  How might it affect future referrals?

Construction leadership stylesNow consider this example.  If you asked a prospective lead carpenter you are considering hiring how he or she deals with stress or frustration on the job and they share that beating the snot out of a wood scrap with their 28 oz Estwing works best, would you hire him or her?  I certainly wouldn't.


A better suggestion 

Instead why not consider the difference between your roles and your identity.

Your true identity is who you would be if all of your roles were stripped away.  It's who you really are as a person and in reality has nothing to do with what your job position is.  

By contrast, your roles are the responsibilities and activities you assume in the course of life, or while on the job, whether by choice or otherwise.  And no matter what roles you serve in life, they are not who you really are as a person.

I've learned from experience that until owners, managers, and employees can separate their identities from their roles, they may be personally affected by the comments, attitudes, and expectations of their clients and co-workers.  This doesn't have to be.  Life is stressful enough already.  Don't let job stress add to it.

For more specific information on the differences between your roles and identities check out this Remodeling magazine article I wrote several years ago.


Construction leadership roles

The next time someone really upsets you at work stop, before you react, consider you are only at work and it's your job position that is being questioned or judged, not your identity.  Your ability to keep your identity and roles separate will help you keep a cool head in otherwise stressful situations.  And, how you react and act will serve as a much better example to everyone with whom you interact.  If what I suggest doesn't work for you or one of your employees you might want to seriously consider anger management therapy.



More articles related to leadership:

Breaking Past $1M in Remodeling: Getting Ready To Do It

Invest In Your Remodeling Business Now, Or Pay Forever

Information and Guidance To Evolve From Being A Contractor To Being A Construction Business Owner

Five Great Books for Remodeling Business Owners


Topics: Employee Relations, Differentiating your Business, Culture, Customer Relations, Leadership, Creating Referrals

As Designers, Are We Honest in our Business Dealings?

Posted by Shawn McCadden on Fri, Feb 20,2015 @ 06:00 AM

Guest Blog: As Designers, Are We Honest in our Business Dealings?

Honest marketing for contractors and designersIn the design industry we have many challenges besides meeting the concerns, wants, and needs of our precious clients. Many businesses have resorted to marketing on the basis of something for free. It prompts clients to want what is offered for free, however, at the same time, causes the knee jerk reaction question to arise, “How can it be free, what’s the catch”?This poses itself as one of the challenges most noteworthy; the honest perception of value that is created. For a certainty, most trends are to downplay, for market segmenting purposes, the true value of reputable trades or product.


As designers we need to realize that no sale is really complete until a successful installation of product or service has been provided for the paying, trusting client. This client in-turn may or may not be a super advocate for our business’ success, depending on the final result.

Wouldn’t it make sense as designers to present all services and products in the true light of actual cost, thus leveling the playing field by being honest in our business dealings? Is it not tantamount to lying to present design or trade services as something that can be commoditized for less than its true value, or for free, when we know it isn’t?

Bait and Switch advertisingTo advertise something for “free” in reality means something else needs to recoup the costs related to the “free” product or service. This is, in all respects, “Bait and Switch” by offering something for free that really isn’t. Doing so may call into question being honest in our business dealings.

“Bait and Switch” tactics are used all the time by many larger corporations and have severely damaged flooring installation, renovation, carpet cleaning, vacuum sales and services, design agent services, product value and the like. The result leaves well intentioned clients in a quandary of who, why and what they can trust.

All operations that work on lowest price marketing set everyone up for failure and feed our waste facilities with massive amounts of materials, due to bad decisions made as a direct result of unscrupulous enterprises who are in it just for the money and opportune themselves to the consumer disposition being taught today. It may be manufacturers, distributors, retailers, advantage driven designers and sales persons who are not honest in their business dealings. Full disclosure of what is lacking in the offer is skillfully sold over to reap unjust profits, at the expense of the honest and unwary, with no regard to the environmental impact.

crossed_fingers-wrLowest cost marketing is not being honest in business dealings, as it may not spell out the true reason something is less, or much less, as many products and services, on the surface, appear to be the same. The adage, “You Get What You Pay For”, is usually visited after the disappointment comes, once the bargain fails to meet the expectation and the delight for the savings is replaced by the sinking feeling, “I’ve been had again”. As designers, is this really the outcome we want our clients to experience, let alone, having to deal with it once exposed?

As designers, we should never want to feed the greedy price shopper mentality created by corporate opportunists and smaller businesses who buy into this mindset. By reflecting on true value all the way around, it makes good sense to present our services and that of others in the true light of costs and need. Today many are thinking in line with “save the planet”. This means as designers we want to be the forerunners in leading and educating by example. Therefore, let us be honest in our business dealings, and thus save our designer business services, giving due representation to great trades, products, costs, the environment and education of our precious clients while we are at it.


Ronald Preston

Guest Blogger: Ron Preston started into the trades at the age of 13 with tools purchased from savings acquired working seven nights per week. Today at 53 he enjoys working with people to bring their dreams to fruition and writes regularly to share his knowledge and thoughts. Let Ron know what you think about his guest blog and the opinions he offers.


Topics: New Business Realities, Differentiating your Business, Guest Blogs, Marketing Considerations, Opinions from Contractors, Customer Relations

How and Why Contractors Need To Create Powerful Testimonials

Posted by Shawn McCadden on Thu, Aug 07,2014 @ 06:00 AM

How and Why Contractors Need To Create Powerful Testimonials

How contractors can get testimonials


Testimonials can be the most effective marketing tool a remodeler has and they are free!  They provide credible confirmation of your marketing message because they come from people who have actually experienced working with your company.   Fortunately, with some planning and the use of simple strategies, powerful testimonials can also be very easy to get. 

Selling and working on fun projects makes sense.  But working for the wrong clients can kill the fun in a project for its entire duration.   In this article I want to share how you can get and use testimonials as a powerful and effective way of demonstrating your company’s differences so you can attract both the right clients as well as the right projects for your business.


Think about what you are or should be selling

In his book “Selling the Invisible” Harry Beckwith talks about outside perception and inside reality. 

  • How Contractors can get testimonialsThe outside perception is what prospects come to think about your business by what they observe, much like looking at a picture. 
  • The inside reality is what they come to know about you and your company by actually experiencing working with you and your team. 

I can personally share with you that understanding this difference and putting it to work within our marketing strategy caused a significant improvement in lead quality and lead quantity at my remodeling company.   By sharing testimonials that revealed how we did business we attracted customers who wanted us for our way of doing business, not just for the quality of our work.

A picture may be worth a thousand words but a well written testimonial can paint a specific picture that has the value of gold.


Four important considerations for creating powerful testimonials

  1. I found that the best testimonials are short and concise, getting right to a main point.  Most importantly, they include the true emotions experienced by the customer as they worked with you and your team, and or as a result of how your company’s processes helped them achieve their true remodeling goals.
  2. They are told like stories and include concrete examples from the customer’s experience that back up the main point and make the testimonial memorable.
  3. I found that it is best to get testimonials in writing from customers sooner than later, while the thoughts are fresh in their minds and they are enthusiastic about what they are sharing with you. 
  4. Always be sure to get written permission to use their testimonials.  If possible, get permission to use their name or initials with the testimonial, as well as the town they live in.   Including the source makes the message all that more credible.



describe the imageIn a lot of ways testimonials are like referrals.  If contractors wait for them to happen they will get some referrals and some business.  On the other hand, if contractors are proactive in causing them to happen and are strategic about causing the inside reality they include, contractors can get great customers and a lot more business.

In a future article I’ll share some examples and some specific strategies you can use to cause and secure powerful testimonials.

Click here to subscribe so you won't miss it.


Topics: Differentiating your Business, Marketing Ideas, Lead Generation, Customer Relations, Books for Contractors, Creating Referrals

10 Ways Some Architects Do A Disservice To Contractors & Home Owners

Posted by Shawn McCadden on Thu, Jun 26,2014 @ 06:00 AM

10 Ways Some Architects Do A Disservice To Contractors and Home Owners

Why contractors don't like architects


If you have been a contractor any length of time you have probably had negative experiences trying to work with architects.   You have probably also witnessed the frustration, disappointment and financial challenges some architects cause for home owners due to their methods of doing business and how they do design development.   Keep in mind I purposely said “some architects”.   Just as there are good and bad contractors, there are good and bad architects. I have personally worked with a handful of great architects.

I know I am taking a risk here and that I will definitely get some passionate comments from architects.   That said, below I offer 10 ways I think many architects do a disservice to contractors and home owners.  Feel free to offer additional reasons and or to dispute my list.   All opinions are welcome, as long as you are respectful and appropriate when doing so.

  1. Bidding on architects plansThe architect either invites multiple contractors to bid on the project or gives the homeowner the names of 5 (or more) contractors to bid on the project, essentially setting up an auction.  So 5 contractors and all their subs do free estimates for the chance to be the lowest bidder (biggest loser).  Then when the home owner actually buys from a contractor they are the ones paying for all the free estimates that contractor did for the people who did not buy.  I think it would be interesting to hear the reaction home owners might have if they knew they were paying for other home owners’ free estimates.
  2. Do you know any architects who have estimating training and or experience? Many architects say they can and will design to a budget and or quote square foot costs to their clients that are unrealistic.   Then if the contractor bids come in over budget many architects will blame all the contractors for being over-priced.   These same architects then even have the nerve to charge the home owner to redesign the project to get it closer to the original budget.  Why do home owners put up with being treated that way?  
  3. Many architects create multiple designs and plan sets for the same project, most of which ever get built from because they do not take into account all of the related considerations (Budget/cost, zoning, soils, incomplete plans/specifications…). When this happens often times the home owner spends so much money on the unusable designs that they have to then scale back the project budget.  Unfortunately the home owner pays for it all the wasted services and contractors waste their and their sub contractors’ time doing multiple estimates, typically all for free. 
  4. Some architects charge contractors a referral fee for introducing them to the client, but tell the contractor they don't want the client to know about it.  In my opinion this is not ethical.   I have no problem with the referral fee as long as the contractor is OK with it.  But hiding it from the client is deceptive because now the cost of the referral is a cost of the project, and, in essence, the architect is asking the contractor to lie about it.   I don’t think contractors need to volunteer the information.  But, if asked about it by the client, or if it’s a cost plus contract, I think the contractor needs to be honest.  For T&M contractors, letting the home owner know that their markup on costs has to help cover the cost of the architect’s referral fee could help justify the markup percentage.
  5. The architect provides incomplete and or conflicting plans.  This one creates big challenges for the homeowner as well as the contractor.   If the contractor points out the missing details he can be accused of throwing the architect under the bus and probably won’t get the job.  On the other hand if the items are missed or ignored when the contractor provides a price the missed items become change orders and the home owner has to pay the additional cost.
  6. architect's plans are over budgetMany architects take the plans too far before knowing if the customer can actually afford the project and or if the project can actually be built.  I think this is one of the worst things architects do to their customers.   Wouldn’t it make sense to make sure the there are no zoning issues and that the project and or the scope are realistic before spending the client’s money to bring the plans from concept to ready to apply for permit?
  7. Some architects require the contractor sign the AIA contract.   That contract essentially says once under contract the contractor has to eat any additional costs to meet building code requirements even if the plans and or the design don’t meet code.  Shouldn't a licensed architect be responsible to design to code and be responsible to their clients for the additional costs of what they missed?
  8. Not allowing the contractor to meet the home owner before providing a bid.   I’m really not sure why architects do this.   Why refer a contractor to the project but then not allow both the home owner and the contractor the opportunity to meet and make sure there is a good fit and that the budget is realistic before asking the contractor to invest a lot of his and his trade partner’s time assembling an estimate?  I think this may have to do with number 2 above.   The architect has no idea what the project will really cost and doesn’t want to risk that the contractor will help the home owner figure that out.  If contractors allow this to happen and still submit a bid, shame on them!
  9. Designing to a budgetThey over-design the project past the agreed budget without providing realistic insight about the additional costs.   Again, assuming the architect agreed to design to a budget, refer to number 2 above.   If the home owner asks for things and or the architect suggests things that will blow the agreed budget, shouldn’t the architect make the true price difference clear to the home owner first and ask if they will commit to increasing their budget before expanding the design and collecting bids from contractors?
  10. The architect specifies products he has no experience with.    This one has caused many contractors a lot of money and or lost sleep; including me!  Often the products can be difficult to procure, may be new and have not yet been proven to serve their intended purpose long term, and or may be way outside the client’s budget.  By doing this the architect often creates financial hardships for the contractor and the home owner, and can cause serious project failure and or warranty problems that typically fall back on the contractor, not the architect.


So, that’s my list. 

I have more but I think that’s enough to get the conversation going. 

Design Build for contractors


By the way, if you are a contractor or a home owner reading this, there is a better way.  True Design/Build Contractors use a process that can eliminate every one of the challenges listed above.  Check out this article titled The Advantages of Design/Build for Remodeling Clients for more on why Design/Build might be a better way to go for many contractors, home owners and even for architects.  



Topics: Customer Relations, Design Options, Working with Design Professionals

3 Ways Contractors Can Become a Trusted Customer Resource

Posted by Shawn McCadden on Tue, May 06,2014 @ 06:00 AM

Ruth Ann Monti


Guest Blogger: Ruth Ann Monti is the founder of TimeStorm Communications, which provides original content, copywriting, social media and marketing services for entrepreneurs and small business. She lives with her son and two dogs in sunny Scottsdale, AZ.


3 Ways Contractors Can Become a Trusted Customer Resource

A recent survey by Planese found the home improvement and remodeling industry earned a customer service score of 4.5 out of 7 in 2013. Not bad, but it could be better. More worrying is our industry's score for meeting expectations, which is just 36 percent. Comparatively, banking scored 61 percent, which is pretty good for an industry that isn't exactly the most popular.

A little bit of work to understand what your customers or potential customers want and offering yourself as a good resource can help you improve your customer service outlook and give yourself a competitive advantage.


How contractors can become a trusted advisor

First, Understand Customer Expectations

Many customers turn to online resources to find out the things they should anticipate during their remodel; usually these sites warn about delays and unexpected problems during the remodel like unusual plumbing and wiring. Dust and noise are hard to control, but this is a great opportunity to exceed expectations by taking an extra step or two and providing a little what-to-expect education beforehand.

Exceeding customer expectations is a strategy entrepreneurs should embrace, whether they run an auto repair, medical practice or remodeling business. Richard Branson, found of Virgin Group, says this is why his business stands out from the competition. If you are about to bid on a project, he says, "deliberately move your customers' expectations up a few notches and consistently over-deliver on your promises"


Use Your Proposal to Provide Customer Education

Begin offering customer education right from the start in your written proposal or estimate. Here are a few ideas about what to discuss that demonstrates your knowledge and experience and can help you shine:

  • Green remodelingTimeframe. It's difficult to nail this down but if you're considering a project similar to ones you've tackled in the past, provide a sample schedule. Note items that can slow things down or build in time to address them. There's nothing wrong with over-delivering by completing a project ahead of schedule because you foresaw potential problems that did not materialize.
  • Access to Specialized Equipment. Let customers know you have access to equipment that isn't part of the standard remodel kit. Provide links to specialized tools like lifts for second-story projects or insulation removal and installationExplain why they will or might be needed.
  • Discuss materials options. Customers want energy-efficient and environmentally friendly materials. Explain the differences between standard drywall and plaster, for example, and the different grades of insulation. Tell them about green materials you've worked with.


Don't Be Shy: Advertise Your Work

Remodeling Magazine Remodeling magazine urges contractors to advertise and enlist past customers for testimonials. Start by sending thank you notes for trusting you with their remodel and ask if they would send a review you can post on your website.

Speaking of: don't shy away from online review sites. Register with Google, Yahoo, Yelp and Angie's List, which is highly recommended for its popularity with consumers. In addition, by registering with these sites, you can respond to reviews and ensure that the information out there is accurate and complete.



Topics: Sales Considerations, Differentiating your Business, Guest Blogs, Building Relationships, Customer Relations

Contractors Shares How To Use Educational Seminars As A Marketing Tool

Posted by Shawn McCadden on Tue, Apr 15,2014 @ 06:00 AM

Brian Altmann


Guest Blogger: Brian Altmann, CAPS is the president of DBS Remodel, Inc.a full service residential remodeling company in LaGrange, NY. He frequently speaks at the Remodeling Show and JLC Live. Brian has over 28 years of experience in the remodeling industry. At JLC LIVE in Providence RI this spring Brain shared his experiences with me about doing consumer seminars as a marketing tactic.   He agreed to contribute this guest blog to help other contractors do the same.  He can be reached at


How To Be Successful Using Educational Seminars As A Marketing Tool

Offering remodeling seminars for consumersIn my 28 years in the remodeling business I have seen many relationships go south between homeowner and contractor! All too often the homeowner is in a position where they don’t even know what they just purchased from their remodeler. Whose fault is this? The remodeler was not paid as a consultant so possibly inadequate time was spent creating a job scope and contract. And of course, the homeowner only wanted to know two things…when can you start and how much is it going to cost! The blame should be spread evenly. I have always wanted my clients to understand EXACTLY what they were purchasing and felt that educating them on the process would be win/win for everyone.

This is why I started to offer seminars to teach prospects “What They Must Know About Hiring A Remodeling Contractor”.


Here are some details on how I do it

I always hold these seminars at a local hotel.  The seminars are complimentary and I always provide coffee and donuts. The duration of the seminar is 2 hours. During this informal, relaxed session we will discuss The Top Ten Questions To Ask A Remodeler During An Interview, how to handle extras, a well written contract, the value of a pre-construction meeting among other topics. I usually ask attendees in the beginning what they were hoping to learn and that helps me drive the content as well. We leave plenty of time for Q&A at the end.

Marketing to remodeling consumer with seminars

Marketing these seminars presents the biggest challenge, but, not one that is insurmountable! Many homeowners fear being sold at such an event. The key here is to keep all content objective and make this about the homeowner and their needs and not an infomercial for your company. Our seminars are sponsored by 16 local companies that are either vendors or trade partners. This allows us to create objectivity in our marketing efforts as well as help to subsidize the marketing budget.


Benefits of doing the seminars for remodeling consumers

The biggest benefit of conducting seminars is that DBS Remodel is perceived as the local expert in our industry. It is a great platform to create trust with those in attendance. We feel that if we give as much knowledge as we can to our prospects and sincerely help them…good things will happen! 

The short video below will give you an idea of some of the content we include in our seminars

The seminars are fun and quite easy to deliver

Many companies would balk at the expense of putting seminars on and those that do will be missing a golden opportunity.  Last year 34% of our gross sales came from homeowners that attended our free educational seminars. We have 15 scheduled for this year with two of them already complete.


Instead of waiting for the economy to turn around we are taking matters in our own hands!


Topics: Differentiating your Business, Marketing Ideas, Guest Blogs, Customer Relations

Seven Ways Contractors Can Get Paid Faster

Posted by Shawn McCadden on Sun, Mar 16,2014 @ 06:00 AM

Seven Ways Contractors Can Get Paid Faster 

How Contractors Can Get Paid Faster


Wouldn’t it be great if you always had the ability to pay your bills on time? 

Even better if you could pay them early when a discount is offered for doing so?  

To improve cash flow at your construction business consider these seven strategies to help you collect project related payments from your customers much faster.

  1. First, during the sales process, discuss upfront in a businesslike manner your desire to finance the project with their money.   Let them know your cost of doing business, and therefore the cost of their project, will be much higher if you have to finance the job using your business’ line of credit rather than their money to pay for their project as it progresses.  

  2. Collecting construction project payments on timeWhen creating a project’s payment schedule use project milestones to determine when payments will become due.  If when doing your estimate you list your tasks and related costs for each task in critical path order, you can then add up the marked up cost of each milestone’s tasks to make sure the amount collected for each payment will adequately finance each phase of the project.   Then, add a little extra money to create a cushion of safety (front loading).

  3. When writing up those payment schedules make payments due for example “When ready to start drywall” rather than “At start of drywall”.   This way you will have the money you need before you start a phase to pay for that phase.   By using this wording, if you are having problems, you can delay returning to the project if your customer doesn’t give you the money when it’s due.  Be sure to explain how this works to your customers while they are still prospects and before they sign your agreement!

  4. Make it company policy (in your contract) and indicate in your payment schedule that the final payment is due at substantial completion.  This is the point at which the project can be used for its intended purpose.   So even if you are waiting on the customer to provide the kitchen cabinet door pulls as the last item to wrap things up, you can still call the project substantially complete, invoice your customer for the balance due and expect the final payment.

  5. When a construction warranty beginsAlso make it company policy that your contractor’s warranty starts at substantial completion of the project.  Clarify however that no warranty work will be completed until the final project balance has been paid in full.

  6. Make sure you bill your clients as soon as the job is substantially complete.   Experienced contractors have learned that if you take two weeks to bill your customers; they will assume they have at least two more weeks to pay you.

  7. In your contract, and on your invoices, let customers know when interest charges will start on late payments.  If for example they have a 30 day grace period to make payment on a final invoice, and they make their payment late, will the interest due start at the 30 day mark, or start back on the original date of the invoice?   If interest will start at the date of invoicing customers will be more likely to pay within the 30 days grace period.  Again, be sure to explain how this works to your customers while they are still prospects and before they sign your agreement!


Being proactive will help contractors collect project payments on time

For some business owners dealing with and or talking about money with clients and prospects is scary.   When I discuss this subject with them many tell me they don’t want to alienate their customers. This certainly can be a valid concern.  However, if you discuss your policies related to making progress and final payments before you let them sign your contract, and you do it in a professional manner and tone, most good customers will toe the line.  There is definitely a difference between being aggressive versus being firm and sincere with purpose.  After all, the best results for the contractor as well as the homeowner come when there is a mutually beneficial relationship.


Topics: Contracts, Financial Related Topics, Cash Flow, Customer Relations

Close More Free Estimates: Be There for the "Which Builder" Decision

Posted by Shawn McCadden on Fri, Dec 27,2013 @ 06:00 AM

Graeme Owen



Guest Blogger: Graeme Owen, based in Auckland NZ, is the builders' business coach.  Since 2006, he has helped builders get off the tools, make decent money, and free up time for family time, going fishing, and enjoying sports.  Get his free ebook: 3 Reasons Builders Lose Money and How to Fix Them for High Profits at


To Close More Free Estimates Be There for the "Which Builder?" Decision!

Close free estimates


Are you wasting time preparing building estimates for jobs you don’t get? Frustrating!  And costly!  Maybe you are like so many builders making one of the most common estimating mistakes: Not being with the client when they are deciding which estimate to accept!

There is no doubt that the builder who is with the client when they are deciding on which estimate to accept is highly likely to get the job.  Wouldn’t it be great if you could be that builder? The thing can.


Here are three keys to being present when the client is deciding "which builder" to hire,

1. Discuss Other Estimates

In your first meeting with your client make sure that you discuss with them how many other estimates they are planning to get. Even though they may like you and tell you you are the only one, it is highly likely that they will consult another builder - if only to check that you are not “ripping them off.”  Also, if they are borrowing money for the build, they may be required to get multiple estimates.

2. Set the Estimate Close-off Date

Having broached the subject, discuss the close-off date for accepting estimates.   Make sure that you give yourself enough time to get your estimate together and enough time for your client to talk to other builders.

3.Remodeling sales meeting Position Being There

Finally, in your first meeting ask permission to be with them when they are making their final decision. Set the date and time for that meeting on your first visit.

Here is an example

You say, “Will you be getting other estimates?”

They say, "Yes."

Accept this graciously with something like. “That’s great.” Then say,

“When do you think is a good date for us to have all the estimates together?”

“What we request is that when you have all the other estimates together we meet and go over them with you. This way you can be certain that you are comparing apples with apples. Now I know that you are probably quite capable of doing this yourself, but we have had cases where people have accepted estimates they have later regretted. They did not fully appreciate exactly what was covered and ended up paying more than they had expected. So it’s our company’s policy to do this. Is that OK?”

“When would be a good time for us to meet?”


No More Free Estimates



Follow this simple procedure and you will increase the number of times that you are able to be with your client at the strategic time when they are making their decision on which builder to use.   Some will not agree.  But if you don’t ask, none will agree!


Post and share your comments below.

Would you try the scenario described above?

So, how many of the last 5 estimates did you close?

What have you found to be the best key to turning estimates into sales?

Topics: Sales Considerations, Differentiating your Business, Guest Blogs, Estimating Considerations, Customer Relations

Tips For Contractors On Ball Park Pricing and Charging For Estimates

Posted by Shawn McCadden on Tue, Dec 17,2013 @ 06:00 AM

Tips For Contractors On Ball Park Pricing and Charging For Estimates

Ball Park Pricing



Any contractor who has been in business for any length of time has probably had to deal with Ball Park pricing and charging for estimates.  Home owners always seem to want one but not the other.  Rather than risk letting a Ball Park price make them look bad, savvy contractors can use the request for one to help cause the other to happen.  If interested in how to do this, read on.



Let’s start with Ball Park Pricing

Ball Park Pricing of Remodeling projectsHow many times in your career has a homeowners asked you for a “Ball Park” price for their project.   And, how many times did your Ball Park price end up being nowhere close to the actual price of the project? 

I find the whole idea of Ball Park pricing comical. I’m not saying it doesn’t have value in some selling scenarios.  I am saying however that when contractors offer a Ball Park price more times than not they strike out rather than hit a home run.

So, when I was selling remodeling and a prospect asked me for a ball park number, I would respond by asking them which ball park they preferred; Fenway Park or Yankee Stadium. That usually stopped them right there in their tracks and helped them think about what they just asked for.  And, by asking that question, I was able to get them into a much more meaningful conversation about their project.  Let’s face it; a "ball park number" really doesn't have much value unless there are some specifications to help give it any relevance.

Try asking them about which Ball Park they are looking for.  Feel free to substitute the parks you use. I think you will find doing so to be a great conversation starter. 


Then there’s the whole idea about charging for estimates

As contractors we know estimates are not free.  Somehow the cost of creating an estimate must be recouped by the contractor. 

Some contractors may say they don’t charge for estimating.  If that is true they are working for free and the cost of estimating is not included in the price quoted to the prospect.  I don’t know about you, but in my opinion if you do estimates for free you are undervaluing your worth and might also be putting your professionalism in doubt.  If you are not charging for estimates, and you also are not accumulating enough money to someday retire, working for free might be a good part of why.  And, contractors who do so are making things challenging for those who do charge by helping consumers think they should get estimates for free. 

On the other hand many contractors who tell their prospects they do not charge for estimates are actually not charging for the estimate in advance, they recoup the cost of estimating through their markup; but only if they sell the job.  


It’s OK if they don't want to pay, but why get offended? 

How to charge for estimatesSo why do prospects get offended when you tell them you charge for estimates?  Did they expect you to work for free?   Do they work for free at their jobs?  I doubt it. 

When I was selling remodeling and homeowners asked if I would do free estimates I would say yes and give them an estimate right then and there.  I would say something like “I estimate the bathroom project will cost somewhere between $15 and 25, 000”.   Then I would just wait.   When they asked why such a big range I would simply ask them why they thought I had to give such a big range.  It usually led to meaningful conversations about the fact that an estimate is really just a guess and may not have any relevance to the true cost of what they would actually want to buy.  And, as a result, having this conversation helped them discover the need for plans and or specification so I could give them a fixed price in place of the “estimate”. 

After all, that’s what most remodeling consumers really want; a fixed price for what they actually want. 


One option you can try if the Home Owner can’t understand why you charge for estimates

Next time a homeowner wants a free estimate, or is upset about charging for one, why not suggest bartering?

"If I spend the time to collect all the info about your project, seek pricing from my vendors, meet with my subs to get accurate pricing for their work, and then assemble an accurate cost and proposal; how about we do a trade? Maybe while I'm doing that stuff you could either babysit my kids or cut my lawn? What to do think Mr. Home Owner, would that be a fair trade?"


Getting paid for estimatesA point of clarification which should already be obvious

If you choose to go down the “Which Ball Park” or “Let’s barter” path make sure you do it in a respectful manner and your purpose for using this analogy is appreciated by your prospect. 

How you say it can make the difference between being the contractor of choice and being shown the door!



Need help with estimating? 

Checkout this Estimating Workshop for Contractors


Topics: Estimating, Success Strategies, Differentiating your Business, Prequalifying, Estimating Considerations, Customer Relations, Plans and Specifications