WHY: PROFITING FROM THE RIGHT APPROACH
This week I met a new colleague, a fellow painter and business owner. He mentioned that he has been busy working 7 days/week in order to catch up on work prior to an upcoming family vacation. He is midstream on a small housing development of 10 homes that is progressing quickly. His phone is ringing with more work from the install department of a big box retailer. He was in the paint store at dinner time waiting for colour matches for the next day so he could keep his crew of seven guys running steady and keep the client's project moving forward. Then he said it...
'I've got 3 estimates waiting for me when I get home.'
Boy do I know that feeling. There goes the rest of his evening. A whole day dedicated to his painting business. A whole week. A whole month...
I've had a love, hate, love relationship with estimates...
When you are starting out, there is nothing more validating than someone out there actually calling YOU of their own volition and asking you for a price for their project. You're just wishing and waiting for that demand to manifest itself through the phone.
Then you get swamped and you can't keep up to it all and the phone...it just keeps ringing. You start going to estimates without putting your best foot forward. You begin ignoring the phone. It becomes a burden.
It was at this point that I had to take a close look at the issue of estimates. Some businesses either don't have to do them, or have the luxury of choosing not to do them. The rest of us, the vast majority of painters, can't do that.
Here are two good reasons why you need to do estimates, even if you are busy:
1. You lose around 20% of your business each year for various reasons. If you want to grow your business even a little bit, you need to find about 30% new business every year.
2. You haven't found your best customer yet. Being busy has kept you from finding more of your ideal clients.
Here are two plain reasons why you need to do FREE estimates, even if you are busy:
1. Everyone else does free estimates
2. Everyone else promotes free estimates
Sometimes it's fun to be different and do the opposite of what everyone else is doing. This is not one of those times. Not doing estimates is not an option. And neither is charging for estimates. Kinda...
So what are the variables you can control when it comes to estimates?
1. How you view them
2. How successful you are at them
3. How profitable they are
View estimates with gratitude for the opportunity. Someone wants you and your services. Allocate some time in your week to do them (like Friday afternoon). If you don't have any to do, try some other marketing initiatives during that time. Be determined to make the most of the opportunity (more on that in an upcoming post). Make it easy for people to choose YOU!
Oh and finally...charge for your time. That painter I mentioned earlier, he worked hard on preparing his estimates after a long day of hard work and at the expense of spending time with his family. He is diligently trying to line up work for his painters so they can provide for their families. Is that not worth something?? Even if the prospect does not chose his bid, he is still providing a service - he is helping them to determine the fair cost of their project. One way I found to charge for estimates, and I did this for at least 5 years, was to tack on $100 onto every estimate I wrote up. I didn't itemize it, but it was in there, every time. If I won about 33% of my bids, that meant that I made $33 dollars for each estimate. It worked out to about $20/hour. Which is very fair, it didn't loose me too many bids and it helped me to stay positive and professional about doing them. Another option is to build some paid admin time into each project - take your own labour time for a project and multiply it by 1.2.
If you appreciate the free content on MicroContractor Blog, please share with a link and click the article sponsor's ad: