Identify Profitable Targets To Win More Work!
If you were the owner of a NFL football team, your number one goal would be to fill the seats every week. To sell lots of seats takes a multiple approach. You must put a winning product on the field and you must sell seats to many different types of fans. Seats don’t sell themselves. It takes a huge effort to create sellouts at profitable ticket prices.
Twenty years ago, you didn’t have to sell very hard to keep profitable construction work and revenue flowing into your company. If your price was competitive enough, you put an average team out in the field, did work per plans and specifications, called the usual plays, and used a simple business strategy, your customers would keep coming back for more. And because business was plentiful, margins were higher, and competition was lower than it is now, you didn’t have to try to win over many new customers to keep busy and make a nice profit. As work was steady, you stayed focused on doing the same type of projects for the same type of customers, and your business still grew. Because there was lots of profitable work, you also didn’t have to try different or new types of projects, services, customers, or contract delivery methods.
Fast forward to today, it’s harder to fill seats with high-paying construction customers who don’t demand more services for less money. Doing quality work with an experienced team doesn’t matter much as your competition basically provides the same services you do at low prices too. You have cut your overhead and reduced expenses as much as possible to stay competitive. This has caused stress as your workload has increased, customers require more services, and prices remain too cheap to increase your markup. The outdated strategy of waiting for calls from your same old customers to bid their same type of work doesn’t give you enough business at a high enough profit margin to make a profit worth the effort.
What must you to win the new game of contracting?
The answer is to win more work at higher margins. By continuing to do business like you did in the past using your old strategy to bid more of the same type of work won’t achieve your goals. For example, to keep revenue and jobs flowing in, most contractors focused on building a specific type of project for a small list of customers. Some focused on building warehouses, shopping centers, industrial parks, custom homes, or interiors for general contractors, developers, or directly to the end user. Some expanded and did more than one type of project. But, most didn’t crossover into a totally different or another diverse type of project or customer type as it seemed too difficult or risky. And offering an ongoing service component to their revenue stream wasn’t even considered as they were too busy to bother with little jobs.
Multiple streams of income sells more seats!
A diverse business plan should include at least two or three types of revenue streams with multiple types of projects and customers. Here is a partial list of the unlimited revenue and business opportunities contractors have to choose from:
Multiple Revenue Streams Of Opportunities
Contracts & Bids
Private Construction - Retail shopping centers, national chain stores, industrial, manufacturing, factories, office, banks, medical, hospitals, self-storage, renovations, interior improvements, utility company projects, housing tracts, custom homes, residential remodeling, residential home upgrades, site improvements
Public Works Construction - City, state schools, military, transportation, offices, hospitals, facilities, roads, highways, utilities, etc.
Service Work & Ongoing Accounts
Property management, maintenance, service, winterization, repair work, energy management, replacement, improvements, relocation
Who do you want to sell tickets to?
In order for a professional football team to sell tickets, they start with a list of targeted customers they want to attack. By determining exact targets to aim at, you can develop a pro-active plan to win more work. For sure, you can’t be successful by bidding any customer that offers you a set of plans against every other contractor who wants to bid. To create an effective sales program starts with determining what you want to accomplish. A football team wants to first sell their expensive private boxes, then to high-end season ticket holders, groups, individual season ticket holders, multiple game plans, and lastly - individual game tickets.
Start with a focused multiple approach. You already have a list of past customers and project types you have completed. You MUST decide to diversify, attack, and seek business in multiple revenue streams. From each revenue stream, select at least one or two new customer and project types you want to attack. From the list above, choose new project and customer types you will attack over the next year to grow your business with diverse types of higher margin and steady paying customers. Need help with your plan, email GH@HardhatPresentations.com and ask for his ‘BIZ-DEV Action Plan Worksheets.’
Create a target customer list
Create and complete a customer target attack list. Start by identifying your existing, repeat, and past customers. Sort them by revenue stream and customer type. For each customer type, you need a minimum of at least 6 existing and 6 new customer targets to go after per customer and project types. Use this sample chart to develop your project and customer target list.
Contracts & Bids
Current Customer Targets New Customer Targets
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Current Project Types New Project Types
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Service Work & Ongoing Accounts
Current Customer Targets New Customer Targets
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- -
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Current Service Work New Service Work
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After determining what type of projects and customers you want to attack, develop specific goals for each customer and project type:
Sample customer target list chart:
Project & Customer Goals
Project Types Customer Targets # Targets To Attack
Shopping Centers Current Customer Targets 6
New Customer Targets 10
Renovations Current Customer Targets 5
New Customer Targets 12
New Project Types Customer Targets
Army Corp Work New Customers Targets 4
Hospitals & Medical New Customer Targets 10
Service Work Goals
Service Work Customer Targets
Building Repairs Current Customer Targets 0
New Customer Targets 15
Annual Maintenance Current Customer Targets 0
New Customer Targets 15
New customer targets are not hard to find. For example, if you want to target hospital and medical construction, search for hospitals and medical complexes in your market area. Call each one of them and ask for the manager in charge of facility construction, maintenance, improvements, repairs, or remodeling. With diligence, you can find the right person to call on at every hospital and medical facility. Get started on your new and improved revenue and profit enhancement program by identifying the new projects and customers you can attack and build a more profitable business with.
About the Author
George Hedley is a best-selling author, professional speaker, and business coach. He helps entrepreneurs and business owners build profitable companies. Email gh@hardhatpresentations.com to request a free copy of Everything Contractors Know About Making A Profit! or signup for his e-newsletter. To hire George to speak, attend his Profit-Builder Circle academy or find out how he can help your company grow, call 800-851-8553, or visit www.hardhatpresentations.com.
