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Chad Prinkey is CEO of Well Built Construction Consulting, a Baltimore-based firm that provides strategic consulting, facilitation services and peer-to-peer panel discussions for construction executives. The opinions are the author’s own.
How many times have you received a follow-up call on a potential project only to feel down as you let your team know you weren’t the highest bidder?
It’s like it’s the simple fact of being no low guarantees that you cannot win the project. If there’s still time, your pre-contract team can get together to lower the price and try to score a win against the odds, but more often than not, this information is a notification that your competition was awarded the project.
However, I have worked with dozens of companies for which notification that they are not the low number is more often than not followed by an assurance that their client will advocate on their behalf and direct the work to them regardless. We will explain how they make it possible.
Give them a reason
Chad Prinkey
Permission granted by Well Built Construction Consulting
“But all this customer cares about is the low price!” We hear this line daily as a defense of long-held beliefs that their damn customers don’t care about value over price. Here’s a new belief system to consider: If your customers don’t care about anything other than low price, you haven’t given them a good enough reason to do so.
Would you spend more money on something if you didn’t see a significant difference between your options? I would not. That said, when you think something is worth much more than the other options, if you’re like me (and most people), you do whatever you can to justify the extra expense.
If you can accept this premise, the question you have to ask yourself is how can you win a position in the minds of your customers that is far more valuable than the other options?
Build relationships
The first step is to build relationships with the right people. If your primary point of contact with your client thinks you’re the best in the business, that may not translate to a dollar more than your competition if they can’t award the project, or at least significantly influence the award.
If you are a GC/CM, navigating the owner’s decision-making team can vary in complexity. Question and discern the data you collect to identify all the players and their different roles in the decision process. Ideally, you should do this completely independently of any specific project, as your questions will be met with more skepticism when there is a live project.
With this intelligence, you can create a business development strategy to build credibility and win the favor of those who control your destiny.
The picture can become even more complex for specialist contractors as the GC/CM may or may not be fully empowered to award your award. Depending on the type of contract and the method of delivery, the owner or even other third parties may influence the award of your scope.
Our clients have found that while maintaining relationships with owners independent of the delivery of any project can have significant benefits for some trades and market sectors, it always pays to build deep relationships between teams and departments of your GC clients /CM.
Choose the right customer
Buyers can be convinced of your value with the right strategic approach. Once you have a chance to win them over, focus less on nailing down a winning approach and more on listening closely to what matters most to them.
Tailor your approach to selling your business to what matters most to them. If what they care most about isn’t a strength of your company, you have to be willing to accept the possibility that you won’t be a good fit.
Keep in mind, though, that not everyone should be your customer, and that’s okay. Focus on the customers who care most about the things that make your business special.
Focus on operational advantage
Once you’ve given yourself a chance to prove yourself, you need to move on. Your friends won’t pay more to hire you if you really aren’t better than the other options out there. This is where operational excellence comes into play.
You can’t think you are better than the other, you have to know what the market standards are and raise your internal standards.
Do market research by talking to your customers and competitors to understand what the rules are. Hire people away from your competitors to learn about what they do better than you and what advantages you can take advantage of. Create processes, train your team relentlessly and ensure you have systems in place to monitor your consistency with standards.
If you’re reading this, whoever you are, there’s room for improvement.
Create a superior strategy
Don’t be afraid to ask clients for the preferred contractor treatment you deserve. Can we expect an opportunity to meet with you after you make an offer? If we are not down, will you contact us and negotiate from there? Can we negotiate the work directly with you instead of competing?
Once the job is awarded, you get regular performance feedback. Find out what your team can do to better meet your customers’ needs and deliver. Then go confirm that your team is crushing it.
Take advantage of your success
Document your customers’ positive feedback by asking them to provide you with a testimonial and asking them to refer you on other projects. Get credit for being the amazing service provider that you are, and you’ll build a powerful case against the apples-to-apples buying environment your buyers tend to create.
