Turn the 78% of Junk Builders Leads into Quality Jobs

Only 22% of clients anticipate the likely budget of their project. The other 4 out of 5? Time wasters – UNLESS you use this method to sort them….

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Having interviewed over 1000 builders, we’ve learned almost 4 out of 5 clients get a shock when they first hear how much building costs.

Many builders, having identified that clients were short on budget, say they turn their back on these clients to avoid wasting time.

Historically, that’s been the only way but this article shows you how to manage those within the 78% that are worth pursuing.

Think about it, based on the research:

• 22% of clients CAN afford their full scope of work and are ready to go (take a free ProCalc trial to identify them)
• The remaining 78% are comprised of two types – those (a) still learning about their project or (b) those who can only afford a reduced or staged scope of work.

So, the 78% – if managed properly – can deliver a stream of high quality clients & cash returns.

Reducing Scope to meet Client Budget

So, if you had an efficient method (like ProCalc) to cost a reduced scope for this group, you can safely bring them back into your pipeline without the fear that they’re time wasters.

That means you’d enjoy your full pipeline, not just the 22% who can afford the original full scope.

Does a Reduced Scope Reduce Profits?

You might worry that clients with reduced scopes will be less profitable, but that should never be the case.

That’s because smaller jobs attract greater builders’ margins.

So, if a client has $500k to spend but a $800k project, re-cost a reduced scope with a slightly larger % margin.

See best practice on margins and how to do this

Re-Scoping Client Jobs Efficiently

If client plans are beyond their reach, you can use a free ProCalc trial to re-cost their reduced scope in about 15 minutes online (book a free trial)

The key steps are:

1. Provide industry rates for the construction of their project. Preferably use 3^rd party figures, such as ProCalc, so the client understands they’re not your figures (industry rates provide independence)
2. If a client gets a shock, ask their budget and suggest you grab a coffee together
3. Over that coffee, sit side-by-side, pull out the red pen and identify items/rooms they can live without.
4. Re-cost the ‘new’ scope in ProCalc in 15 minutes to fit their budget – using industry rates. Doing this while sitting with the client helps empower them to reduce scope and adopt you as their preferred builder.

You Will Become Their Trusted Expert (& Preferred Builder)

Doing this with clients enables them to understand the costing process and how they can contribute to better budget outcomes.

It will position you as the expert builder who cares enough to explore the ‘what ifs’ to help them meet their budget.

That means less competition, greater trust, efficient engagement and an immediate opportunity to agree to progression of preliminary works or a detailed estimate.

“ProCalc has been a game changer in streamlining our processes & increased the value we’re able to provide to our clients immeasurably. I can’t recommend it highly enough to builders! It should be the industry norm to provide this information to all clients prior to venturing anywhere with a project. ”

Evan Turner, Watershed Building Company

For Clients with Outrageously Low Budgets?

For clients you meet who are clueless about costs, don’t give up on them. It’s just that they’re new to the process and are learning what they can afford as they go.

Once you’ve established they can’t afford their dream, include them in your database and stay in touch (preferably with a CRM). Then, when they’re ready (and more informed) they’ll be back in touch.

Remember, sometimes the sales cycle takes years so having a process for these less mature enquiries will deliver jobs to your future business.

Let’s face it, you’ve already put in the effort to attract their enquiry, it would be wasteful not to ‘harvest’ the future job once they’re ready.

You Might Also Like:

• Builders, Get Your Pricing Right Every-time – No More Under-Quoting
• Transform Your Building Business in 43 Mins (webinar)
• How (& Why) to Charge for First Client Meetings
• Take a Free Trial of ProCalc
• Stop All Free Client Meetings – Charge Upfront
• Want more tips like these? Attend the Webinar: Work Smarter, Not Harder

Richard Armstrong is a former registered builder who recently interviewed 1000+ experienced Australian builders to identify how they best manage clients, budgets and profitability.