Making a sales presentation in a prospect's house allows the homeowner to be at ease and to envision the remodel on site. Getting the homeowner into your office might be a harder task, but once in the office, the prospect has fewer distractions and can see more products in person. Both approaches have advantages; Jud Motsenbocker asks remodelers John Murphy, Robert Frazier and Phil Underwood which they prefer and why.
Jud: What percentage of your sales are done in the clients' home versus your office and/or showroom? Robert or Phil?
Robert: At least 75 to 80 percent is in the showroom.
Phil: Our larger jobs, the additions and the add-a-levels, 90 percent of those are done in the showroom. We emphasize that we are a full-service company and we offer service to customers that nobody else does. We want the people to come in and see our campus. We want to show them our showroom, our finance department, our construction department, our zoning department, our permit department, talk about the process and how we give them full service with no pain.
If Mr. Jones refuses to come into the showroom, I will go out to the customer's home, do my presentation with my pitch book, then hopefully they will follow us back to the showroom or make an appointment at the showroom.
John: On design/build projects, we do a first interview in their home, and the second interview is in our office. We usually ask for a design check in the first interview. If that doesn't happen, that second interview in the office is usually about getting a design check.
The average job size on the Case side, on contract sales, is around $7,000, and that typically is a one-call, in-the-home close. Hopefully at the height of emotion during the sales presentation you are able to get them to agree that you got a good solution. You generate the estimate and produce a contract right there.
Jud: Give me a description of your showroom. Does it have kitchen displays and siding displays and bathroom displays? How is it set up?
Robert: We have a couple bathrooms which we did very nicely for our own use that we use as displays. We sell everything in the showroom: siding, windows...
Phil: It has roofing samples, siding and floor samples, construction material, beams, microlams, hangers, windows, everything is there to give the customer.
Robert: Blueprints. Pictures.
Phil: We let our customers know we are in the construction business, not in the accessory business, but because we have associations with all the suppliers, they're going to get the builders' price on anything they need to complete their project. We have samples of all the items — the tile, the flooring, the kitchen cabinet brochures, brochures of vanities — but we do not do any of the kitchens here. We send them directly to the kitchen designer with the plans and they pay for it directly with them.
Jud: John, what does your showroom look like?
John: Our showroom is not that involved. It's more of a conference room setting. We use the picture projector and the Internet a lot. We can go on the Web to pull up a sample or something. We have basic siding, roofing, hardware, some basic kitchen cabinet stuff. We do our own kitchen design. We're actually a Crystal Cabinet Works dealer.
Jud: How does your approach to sales differ in the house compared to in the office?
John: In the house is where we give the presentation to get them excited and come up with a solution. We need pretty skilled sales staff in that situation. They have to have some construction knowledge to propose a solution. We have a computer construction estimating program they use in the house, so they have the numbers, but they still have to understand how it goes together and which menu items to put in the estimate. The pricing is pretty accurate in terms of our margins and we don't deviate too much.
When people come in, most of the time we already have that retainer. Usually our design retainer is in the 2 to 5 percent range, depending on the size of the job.
Jud: Is your closing rate in the office high compared to in the home?
John: Once they come in the office and we've already done a presentation, it's probably more like 80 to 85 percent. On average, the in-home, one-call close ratio is about 30 percent.
Jud: Robert, Phil, what is your closing rate for in-house compared to in the office?
Phil: The ratio on the showroom close is extremely higher than the in-house close. I would say somewhere around 80 percent in the showroom, between 30 to 35 percent in the house.
Robert: When someone comes in the office, we have a retainer agreement. Our closing ratio for a retainer agreement is probably 80 percent. We get at least a $1,500 retainer on a credit card or in a check, and at that point we go forward with our own draftsman.
I have three outside architects. I don't let the outside architects do the preliminary plans anymore because they were bogging us down. Our turnaround for prelims on a whole add-a-level with three or four different looks is a couple of days. We get them back in the office, they pick out the prelims, and we close the deal. We just closed an add-a-level from the time they came in, to the retainer agreement, to the preliminary plan and all the documentation — we get about twelve sets of paperwork — in five days.
Jud: Do you have different people that do in-house sales compared to in-office sales?
Robert: I want all the salespeople to learn to sell in the home as well as to sell in the office. Most of the people we get to come in our office. We're selling bigger jobs now. I'd say our average deal is now about $130,000. So it's a whole different approach, it's not like the tin man where you hammer people and get them to sign up that night.
John: We're divided more by job size. Our design/build staff is more design-oriented on the bigger projects. The smaller job staff, the guys that do the in-house, one-call closes, they're more production-oriented because they have to know the solution and offer it and sell it right there, right then.
Robert: I would say a guy going out to a house has to be a little stronger. I don't think that's ever going to change. If you want to go out to a house and walk in with your briefcase and samples and pictures and do a full presentation, you have to ask for the order.
Jud: You're saying a guy who goes outside needs a little extra sales strength.
Robert: Yeah, and be a better closer.
Jud: What can we blame that on, more support in the office?
Robert: When someone comes to your office — when they pull into your parking lot — right then and there, you have the edge. When they walk into your showroom and you do your full presentation, it's just an easier type of sell. We qualify people on the phone naturally. We tell them what they need to bring in. We need pictures of their house and their property survey. Then we can do the measurements and we can eyeball it. They're sitting at our table with all our pictures and awards and service records.
I was brought up canvassing door-to-door. Most of my selling was in-house. I was taught if you walked out of the house without the deal, that was it. When I went into my own business, I changed that theory because I did get call-backs. People do call you back if you do make a full presentation out there. But you always have the edge in the showroom, I don't care how strong a sales force you have outside.
Jud: John, is there anything in particular about your showroom that you think makes it stronger than selling in-house?
John: Well, we don't have a lot of samples. But for probably eight years, I've been sitting people down in front of the computer, doing a 3-D walk-through and things on the LCD projector. That's been a differentiator. It turns a lot of people on that they can actually visualize their project before it's done.
Jud: You're using technology to help sell. Talk to me about that more.
John: On the projector, we'll try to do a couple of floor plans to give people some different perspectives. We can edit the plan right in place, show them something a little different. That usually engages them, gets their creativity flowing, and they get into the process. Then we can explain to them the pros and cons of different layouts. They'll ask for something we know doesn't work; once they see it they understand why it doesn't work. It leads to a greater level of trust and improves our ability to give them a product or project that satisfies what they're looking for.
We do that after we get a design retainer. It's more of a closing tool. If we're going to go out to do a home measure up, we're not going to do it without some level of commitment by them.
Jud: So you can put that room addition or second story on this house and they can physically see what it's going to look like on the screen. Can they walk through their home and see their project completed?
John: Right. They can walk through and change the furniture, change the color of the walls, the species of wood on the cabinets or whatever.
Jud: Robert and Phil, what do you guys do? Do you use technology?
Phil: We have models of ranches and Cape Cods. You can take the roof off and actually look down inside the house on different floor layouts. And we also use existing floor plans and blueprints. Every job we do, the customer has to sign off on the prelims. They have to sign off on the blueprints and those blueprints become part of our home improvement contract.
Jud: Do you use any kind of laptop computers or LCD projectors for your design and selling?
Robert: No, we have not. Most homes in our area don't vary that much. It's either a Cape, a ranch or a bungalow. When we qualify a lead, we pull blueprints from a house very similar to it. We have thousands of sets of blueprints. We use those blueprints in our presentation, and we give them different looks.
We do give them three or four different preliminary drawings. We have an excellent draftsman and they pick from that during the close.
Jud: John, do you put something like your presentation book on the screen?
John: No. In our presentation book, we have some renderings and drawings, some before pictures, a blueprint, and then a CAD treatment and the finished project so we can show them how they can view it and how it's going to unfold. That's part of what we're selling: When you engage us for the design, here's the process you're going to go through, here's how we're going to get to what we're showing you and complete your end project.
Jud: We're finding that having a PowerPoint presentation as a presentation book type of thing is selling the company. Then going ahead and showing, "Here's your home and what we've designed for you is this room or second story. Let me show you what it's going to look like from the outside." It gives you the shock, gets the adrenaline going so that it works.
Robert: We get our customers enthused. We all know that if there's no enthusiasm on the salesman's part, you're not going to sell the deal.
Jud: When you put these leads up, who determines whether they're going to the showroom or they're going to the house?
Phil: Robert tries to get everyone in the showroom. If we can't get them into the showroom, then we go to the home.
Jud: Who asks that? The salesman or the person who takes the lead?
Phil: The person who takes the lead. "Come to our showroom. We have appointments available tomorrow at 10 or 4, how does that sound?" And then get the appointment.
John: When the leads come in right now, anything that's significant in size, I get them and I'm tracking. Then they get some more information about the client and the project so they're prepared for that appointment.
Jud: OK, but you do it by project size. You know whether it's a Case Handyman thing or whether it's going to be a design/build.
John: If it's a Case lead or a small job lead, I've got a client coordinator. She takes it and books and sets an appointment with one of the reps in the home. She puts it on her calendar. They get a lead sheet and a brief job description. Even in those cases they confirm and do a little warm-up so they can come with enough brochures and materials so they can close it in-house. It can vary from job to job what they can bring for back-up.
Jud: In your marketing, do you advertise to "come to our showroom"?
Robert: Absolutely. We push that and we push it all the time. We want the people to come in here.
Jud: John, are you pushing that in your marketing?
John: We don't really push to come in other than it's part of our presentation. We try to create separation in our professionalism, in our full-service capacity, in our design ability.
Jud: Do either one of you have open houses or parties where past clients come into your showrooms?
Robert: No, we have not done that yet.
John: We haven't done that in our office. We've done a couple in conjunction with owners in their newly remodeled home.
Jud: Do samples differ in the showroom compared to in-house?
Robert: The samples are larger in the showroom.
Jud: Because you can handle them better.
John: I agree with that. We have a little bigger samples, windows and cabinets in our showroom.
Jud: How much credence do you put in the quality of your showroom? Is that a vital part as far as you're concerned?
Robert: Absolutely! I don't think there's anyone else in our area with a showroom. They're operating out of their trucks. Everyone's heard the horror stories, and we really push that. This is our building; we own it. We just got a permit to put another two stories on. We'll be starting in the spring. We show them the plans, how we're expanding.
We have a building next door that happens to be our lawyer's. His two tenants moved out, and we took over the whole building downstairs. That's our construction department. We have another small, separate building behind it, and that's our variance, zoning and permit department. We walk the people around. It's the Robert's Home Designs campus. It works.
Jud: John, how about you?
John: We're more sample-oriented right now but over this winter we're going to create more of a living-room atmosphere and put in some soffits and indirect lighting. It'll have a lot in it — it'll be kind of busy but hopefully create some ambience that we really don't have right now.
Robert: We have all the indirect lighting, the bells and whistles.
Phil: And marble flooring and beautiful bathrooms. Crown molding and space molding. It really is a beautiful showroom.
Jud: So what you're saying is that when somebody walks in there you want them to say "Wow." Then you have a system in place to sell the company, not the product.
Phil: That's correct. We are salespeople. Sell the company first.
Jud: John, you're basically in the same boat. You're selling your company and you want them to be impressed when they walk in the door.
John: Right, right. Our focus has been on facilitating the best answers for their home.
Jud: When clients walk in the front door are their names on a bulletin board or something welcoming them?
Phil: No, but the warm-up and welcome is the handshake, coffee, tea, beverage, crayons and coloring books for the kids.
Jud: Do you have a kid's corner for them to play in while their parents are talking to you guys?
Robert: Yes, we do. We have two different areas. When we add the new building on, we're going to have another area so we can get the kids away from the parents so there's no interruption to the presentation and the close.
Jud: John, do you have anything for the kids?
John: We do, not quite that formal. We've got Legos and coloring books and sometimes the kids, depending on age, sit on the corner of the table and color. Other times I'll have somebody else in the office distract the kids in the next room, depending on whether the parents are able to focus or not.
Jud: Is there a huge advantage when you get prospects into your showroom and they're not distracted by the things in the home?
John: That's why we get them in on the second appointment, it's to get them out of their environment and get them into an area where they can see some things and get excited. If it gets to be toward dinner time or the kids are in the environment, that can be very distracting in terms of getting both husband and wife on the same page to make a major decision. Anytime you can remove the distractions you have a better chance of closing a deal.
Robert: I've had it happen where the phone rings, or the neighbor knocks on the door. You give them the high sign and you're hoping they leave, and they don't. We are pushing the showroom, we are investing a lot of money in this large addition we're doing next year. We feel that's the way to go in the future and that's the way we're going.