Are you bidding on jobs, or are you selling them? There’s a difference.
Bidding is a race to the bottom. He who has the lowest price wins, or maybe he who has the lowest responsible price. Either way, the bidding process is all about price. In my opinion, getting involved in the bidding game is nuts. There isn’t any way you can win unless you’re the only bidder, and yes, that includes commercial work.
Selling is showing a client that you can provide a service that meets their need. It’s primarily about the service you’ll provide, not the price of the job.
Many experts promote the idea of bidding jobs. Pick up any industry publication and you will find articles about how to win bids. How to sharpen your pencil. How to cut your overhead so you can be more competitive.
Architects and designers almost always talk about getting three bids and encourage their clients to do just that. Why do they believe it’s in their customer’s best interest to pay the lowest possible price to either build or improve what is usually their biggest investment?
If you were facing a knee replacement, would you ask three doctors to bid on the surgery? I know, we don’t worry about price because the insurance company handles it all, but just imagine if payment came out of your pocket. Would you go with the lowest bid, or would you be more concerned with your surgeon’s competence and whether they will follow correct procedures, install the best materials, and have a supporting staff of the highest quality to get the job done, even if the price is higher?
Since we expect all other professionals to focus on quality, value and service, why do we think we have to focus on being the lowest bid?
If you look at every lead as an opportunity to make a bid, your mindset is going to be focused on price, and you’ll say or do things that keep your potential client focused on price. If you look at every lead as an opportunity to make a sale, your mindset will be focused on what you have to offer to meet their need.
Our book Profitable Sales; A Contractor’s Guide explains the process of getting the customer to make a commitment to you. The big commitment comes after getting a lot of small commitments that lead them to select you to do their job. That commitment won’t happen unless you’ve demonstrated that you’re competent and professional.
You need to be answering all calls professionally, or using an answering system that manages the calls professionally. When you get a phone message, return every phone call by 9 am the next day. Don’t just return the phone calls that you want to return; get in the habit of returning every phone call.
Keep your appointments, and surprise them by being on time. When you’re late to an appointment or don’t show up at all, you’re breaking the promise you made to the potential client when the appointment was set. A broken promise is not a good way to start any relationship.
Dress appropriately, conduct yourself as a professional, and be prepared with all the necessary paperwork to write the order. It’s a lot of little things that go a long way in establishing the trust you need when it’s time to ask for the order.
Learn how to ask questions so that the client is always thinking about what they want done and when they want it done. Help them develop their criteria for picking their contractor, and help them set a budget they can live with.
None of those things are important if your goal is bidding on the job. “Winning” a bid is seldom a win, especially if you then have to figure out how to build the job without losing money. Resolve today to focus on selling your jobs, not bidding them.
The knowledge and experience Michael Stone gained in his 60+ years in construction has helped thousands of contractors improve their businesses and their lives. He is the author of the books Markup & Profit Revisited, Profitable Sales, and Estimating Construction Profitably, and is available for one-on-one consultations.
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