Not all contracting businesses will survive the coming year. I won’t cry over the loss. Some contractors who merely limp along in good times really become major problems at every level of the industry during downturns. Recessions and cyclical slumps should be compared to the wind storms that prune great forests. Storms, lightning and strong winds are the recessions of a great forest. The weak branches, the defective trees, and the trees that grow tall and thin because of overcrowding are “wind pruned.”
The strong trees survive and grow stronger, pruned of their weaker branches. Some strong, tall, old trees are hit by lightning and lost in the process, but usually the forest is better for the pruning.
Your job, as the head of your company, is to be sure that you have trimmed your weak or dead branches and are prepared to survive any recession, be it long or short.
I can remember, as a small child, going with my father to the county seat near where I grew up in Pennsylvania to visit another contractor who had been very successful in the Roaring ’20s. This contractor was saddled with a lease and fancy showroom on the main street. I thought it very impressive, but keep in mind that as a child of the Depression it did not take much to impress me. The most remarkable thing about that showroom was the tropical fish in every plumbing fixture on display!
People who could not afford the fine fixtures displayed could afford a couple of pretty fish and they all left knowing where to buy pretty plumbing fixtures and warm homes. After the Depression was over, he still had the best showroom in town but he got out of the tropical fish business.
In your business and in your town, any downturn or recession will change the character of the available market for your products and services. Many of you have been softened by the temptress named new construction. In recessions, new construction, residential or commercial, quite often becomes the competitive battle ground of no return as builders beat down their plumbing and heating subs.
If you are a small- or medium-sized contractor with a combination of new construction work and service, you have a gold mine of customer information and trust that must be used.
You know who needs upgraded commercial restrooms, a new kitchen, a bath on the lower level or radiant heat in the sun room. You have a relationship with entire developments of potential customers whose homes were built with the cheapest, smallest and least efficient of our industry’s products.
Annie and I live in a modest house in a neighborhood where the houses that come on the market are sold almost immediately. The siding and windows remodelers have worked the area very effectively. I have never had a call from anybody to suggest that we should turn one of our bedrooms into a large master bath and walk-in closet combination. (Incidentally we are now too old to suffer such a disruption, so don’t call us, but 10 years ago we could have been enticed.)
Most restaurants (excluding the chains) I visit have restrooms that stink! Actually stink! You have a significant sales pitch that includes the fact that customers judge the quality of the kitchen by the quality of the restrooms and that the masking odors, colored blocks of moth balls and the urinal strainers deaden the olfactory nerves and decrease the ability to enjoy good food. In most instances a good case could be made that the cost of restroom upgrades will be offset by the lowered cost to clean or to buy and maintain air fresheners and strainers (which properly functioning urinals do not ever need).
There is magic in the kind of sales I have described because they are “creative.” You can walk into an existing customer and pitch that kind of upgrade and it’s never subject to the normal bidding process.
Doing quick, quality upgrades and coordinating the efforts of other trades and crafts that are not on your payroll (such as the tile guy) can be complicated and the only reason you should do them is because you have learned to charge enough to make these projects fun.
Some of you are already doing this kind of creative selling and upgrading to both old and new customers. I hope you will share your success stories or your problems with me. If you have read me over the years you know that I will present your shared experience in such a manner that your identity and location will be protected. Send me a short summary and I will call you to discuss it. This is not a broad invitation but strictly limited to creative sales to existing customers.