Hook or Crook Marketing Dreaming of big commercial jobs that’ll bump up your volume? Generating leads for those jobs is not at all like residential. Rick Young, of Gilkey Commercial, peruses online information sources, which the company pays to subscribe to, such as Blue Book (www.thebluebook.com, specifically BB-Bid, the publishing company’s online bid management system) and Dodge Reports (www.construction.com), among others, to identify commercial retrofits in the company’s markets. “We look at each job individually and determine what the scope of work is, what products are speced, and if it is a specification we can meet,” Young says. “If it is, we will go after that job.”
Henry Muhler Hay, owner of the Muhler Co., a residential and commercial window replacement operation in Charleston, S.C., that does a third of its sales in commercial, says his operation has many ways of soliciting new construction and commercial window replacement business. One tried-and-true method is to gather a half dozen or more architects at a location, feed them box lunches, then present the company’s case for installing windows in whatever new construction or large-scale remodeling jobs those present are involved with. Several months ago, for instance, the Muhler Co. did a seminar on recently rewritten debris codes for coastal areas. One hundred and forty-four local architects and engineers attended. The company also networks for business through its membership in the local home builders association, as well as in various subcontractor associations.
When Murphy elected to pursue large commercial jobs, he hired a local marketing company to produce a video targeted to condominium boards and building managers. The 15-minute tape shows shots of the company’s crews working inside apartments to install windows with no debris and very little disruption to the owners.
Many contractors doing commercial say the key to generating more work is building relationships with builders, general contractors, building managers, commercial property owners, and other responsible or involved parties. Where referral and repeat are only part of residential lead generation, they are at the heart of building commercial business.
Bill Frazier says 63% of his commercial business comes from past customers. “It’s a great business because there is no lead cost to it,” he says. “You build a relationship with good service and good price.” Then you ask for the next job. You also have to knock on more doors. Austin Gutterman, for instance, approaches every architect in town with a book and CD showing the distinctive gutter products —copper downspouts, half-rounds, and bracketry — the company fabricates and installs. “By contacting those architects, we get our jobs speced and we get the call,” Frazier says. The most expensive gutter job the company has done so far was $63,000, which compares with an average gutter protection job of around $2,500.
Construction Expertise Sells Selling commercial jobs scarcely resembles selling across the kitchen table to homeowners. Bids are detailed estimates that cover not only a (typically) fairly extensive scope of work, but — to play it safe — they also spell out exactly what isn’t covered by the contract. “You need to read a contract backwards and forwards,” Hay says. He cites a multimillion-dollar window installation project in which the contract he signed specifically excluded window protection and cleaning. When inclement weather resulted in $260,000 worth of scratched glass, the building owner came back to the Muhler Co., insisting it was responsible. “We said, ‘Look, we excluded that everywhere.’”
Putting together such proposals, and convincing potential clients of the company’s expertise, takes a different type of salesperson. Construction experience is a necessary prerequisite. The people who sell your projects have to be able to read blueprints and know how buildings are designed and function. It might take six weeks to get a residential salesperson up to speed, a year and a half for a commercial one.
“Residential salespeople don’t understand what commercial buyers are looking for,” Gilkey points out. “They just don’t know how to talk to them. The architect wants to know exactly how things are going to be done. They want shop drawings. Commercial salespeople know the language and the technical details.”
Such jobs may take weeks, or months, to be sold. That changes the way salespeople are paid. Rather than straight commission, commercial salespeople are often paid salary, or a draw against earnings, with some type of additional incentive, such as quarterly bonuses.
Estimating mistakes can be fatal. “If you have a residential project that goes sideways, it won’t put you out of business,” says Scott Barr, owner of Southwest Exteriors in San Antonio, who began doing fiber-cement siding jobs on apartment complexes several years ago. “But if you have a commercial project, it could kill you.” Barr found that out when he inaccurately marked up a condominium project. “The guy I was working with underestimated the labor part of it,” he recalls. “I had to go back and say, ‘I can’t do it for what I said I could do it for.’ It’s probably one of my most painful experiences.” Fortunately, the client understood.
