Brian Phillips
On occasion, my company will be hired by a homeowner’s association or property management company to do some painting in common areas of a small community of town homes. Many times, while doing this work, an individual home owner will ask us to do some small job for them, such as paint a door. These requests usually create a number of problems.
Painting a single door is seldom an efficient use of our time. After applying the first coat, the paint must wait for it to dry before he can apply the second coat. If his only job for the day is painting a door, I have to charge an outrageous price to make it worth doing. Most customers understand this, but don’t want to pay $350 to have a single door painted.
A few years ago, I realized that there was a way to create a win-win out of these situations. If I could arrange for the painter to paint five or six doors in the same group of townhomes, I could charge a reasonable price, keep the paint busy for a day, and make a profit. That is when I discovered that I could sell paint jobs while I slept.
When I am contacted to provide an estimate for one of these jobs, I survey the community for other work that might be desired by the individual home owners, such as refinishing doors or painting balcony railing. Because these communities are small (usually less than 20 homes) and the homes are similar in design, I can quickly work up a price for this work for each home.
Once we are awarded a contract, we begin marketing to the home owners. We explain that we will be working in their community, and while we are there we can offer special pricing on other work. I direct the home owners to a web page that describes the work we are offering and the price. And–here is the really cool part–I provide a link for them to order the service and pay for it through PayPal. I literally sell paint jobs while I am sleeping.
The first time I did this I turned a $1,000 job into a $5,000 job. Because the home owners were paying via PayPal at the time the service was ordered, I didn’t have any collection issues. Other than a few hours working up the pricing, setting up the web page, and doing a little marketing, it was almost painless for me. And it was very convenient for the home owners.
Because we have been hired by the HOA or property management company, we have instant credibility with the home owners. The convenience we offer greatly reduces the chances that they will seek another estimate. I don’t have to spend hours giving multiple estimates for small projects. And we can schedule our crews much more efficiently.
Looking back, this seems like such a simple idea that I am surprised it didn’t occur to me much sooner. However, as is often the case, many ideas seem simple in retrospect. But whether the solution is simple or not, sometimes all we need to do is think out of the bucket.
Brian Phillips
…maybe what you consider to be good or true is skewed. Sometimes things are so good and so true that people just don’t want to accept it. They may be weighed down with skepticism or shackled by fear.
For example, what if I told you that you could buy rental real estate for $150 and generate cash flow of $120 to $150 a month? You would probably think that this sounds too good to be true. You’d be right that it’s good. You’d be wrong that it isn’t true. I’ve done it twice in the past 4 months and I’m going to do it again in March. And what if I told you I’m going to buy another property for $0 and it’s going to generate the same type of cash flow?
My point here is not about real estate. My point is about your mindset, and that applies to any business endeavor, including painting. Indeed, it applies to life.
You’ve probably heard all kinds of claims about real estate, internet marketing, selling vitamins, and countless other businesses. And if you are like me, you probably dismissed most or all of them. Certainly there are people making outrageous claims that could never be true. There are also—on occasion—people who make outrageous claims that are true. The “trick” is to identify which is which.
Outrageous success usually requires outrageous claims. For example, the Wright Brothers made an outrageous claim—they could build an airplane. Henry Ford made an outrageous claim—he would build an automobile that the masses could afford. These men, and countless others like them, made claims that were considered outrageous at one time. But their claims were true and they proved it.
So, the fact that something sounds outrageous or too good to be true is not a valid reason to reject it out of hand. And that brings me to the real point of this email.
Growth, in any form, requires pushing boundaries. It means venturing into unchartered territory, doing something new, challenging the status quo. Physically, our growth from a helpless little baby into an adult happens automatically. But our success in business and in life is not automatic. It is a consequence of the choices we make.
If you want to grow your business you must push boundaries. You must try new things—at a minimum things that are new to you. And sometimes this means embracing ideas that seem outrageous or too good to be true.
As an example, years ago the late Richard Kaller was a prodigious poster on various Internet forums, including those for painting contractors. He challenged conventional thinking and often made claims that seemed outrageous, such as claiming that painting contractors could and should sell their services for $50 an hour or more. He was regularly and routinely chastised, called a snake-oil salesman (and worse), and subjected to all forms of verbal abuse.
On the surface many of his claims were indeed outrageous. But when I looked below the surface, when I looked at the full context and the reasons for his claims, they made sense. Increasing your prices from $30 an hour to $50 an hour is preposterous if nothing else changes. However, if you consider the full context the claim makes perfect sense. If you understand that customers buy value, that to command a higher price you must offer more value, that you must communicate that value and its benefits to the customer, then you can see that $50 (or more) is not outrageous.
I certainly don’t mean to suggest that every claim is valid and warrants protracted consideration. But to reject ideas out-of-hand simply because they are new and challenge our thinking can be very limiting. Sometimes what seems too good to be true just requires a new perspective.
Brian Phillips
It is often said that in negotiations “he who speaks first, loses.” The idea is that once you give away your position, the other party can begin to chip away at it and get more concessions.
This adage isn’t literally and always true. Good negotiating skills, as well as a clear idea of your goals, can make speaking first beneficial. For example, if you want $1,000 for your service, but initially ask for $1,100, you have “wiggle” room to offer concessions and still get what you want.
Sales is as much about listening as it is about talking, and perhaps more so. While our goal is to sell our service, we should also be trying to create win-win situations. This requires listening to the other party to understand their goals and desires. It means understanding their motivations and the results they are seeking.
While we all want to tout our service, sometimes the best way to do this is to keep our mouth shut. Sometimes, if we do more listening than talking we will wind up with the gold. This is true beyond negotiating a price.
To propose a job that meets the customer’s needs and expectations, you must first understand those needs and expectations. And you can’t do that if your jaw is flapping.
Brian Phillips
Over the years I have had the pleasure (and sometimes the displeasure) of getting to know a lot of contractors. No matter where these contractors live, or their particular trade, they voice the same complaints, such as low-priced competition, insufficient leads, and the difficulty of finding good help. I am not going to address those particular complaints in this post, but rather the attitude contractors can take regarding them.
It is easy to complain. But complaining seldom does any good in and of itself. Complaining doesn’t change the actions that give rise to the source of the complaint.
Take low-priced competition for example. This has probably been a problem since the first caveman began offering his services, and it is likely to always be a problem. Complaining about it won’t change that fact. We simply aren’t going to change the attitude or the actions of discount contractors. We can however, change our attitude and actions and thereby reduce or eliminate low-priced competition as a concern.
To illustrate, consider Rolls Royce and Hyundai. Both make automobiles, and in a certain sense, Hyundai is a low-priced competitor to Rolls Royce—their automobiles are much less expensive. But these two manufacturers have vastly different markets, and I seriously doubt that Rolls Royce pays any attention to Hyundai’s pricing. It simply isn’t a concern because Rolls Royce offers much more value to its customers.
Contractors can take the same approach. We can compete on price, or we can compete on value. Which we choose depends on our attitude.
Many contractors firmly believe that clients focus on nothing but price. This is usually a self-fulfilling prophecy, as those contractors do little to offer more value. They look just like their competitors, and as a result, give the client no reason to pay more money.
But a contractor with a different attitude—a contractor who is value-oriented—recognizes the fact that a higher price demands greater value. Such a contractor does not complain about that over which he has no control—the pricing of his “competitors”—but instead seeks to distance himself from them and thereby eliminate them as true competition.
If you find yourself complaining about low-priced competition, you might do well to honestly assess your business and your attitude. You may not be offering enough value, communicating the benefits of that value, or both. And that is something that you can change.
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