Growing your remodeling business in the current economy

Understanding the decision-making criteria for target clients today is the first step in strategically mapping how to sustain and even grow your remodeling business in the current economy.

October 31, 2008

Doug Dwyer, president of DreamMaker Bath & Kitchen Worldwide

Doug Dwyer
Contributing Editor

Contrary to the financial woes making national headlines, there is still a market for remodeling. And understanding the decision-making criteria for target clients today is the first step in strategically mapping how to sustain and even grow your business in the current economy.

There are remodelers in vastly diverse locations offering services at greatly different prices who are actually having a good year. It may not be their best year on record, but it certainly isn't their worst either. And the secret to their success is less about reading the minds of these remodelers and more about understanding their ability to read the minds of their customers, their competitors and their market. It is less about the city where they oper-ate and more about the solutions they can provide.

These remodelers have found a niche for upscaling in a down market. They can correctly identify customers who still want, and oftentimes need, to remodel a home today. They know who their competitors are and how to differentiate themselves in a tough environment. They also know how to use a weak economy to advance their position for today and into the future. Here's where success is a plan and not a reaction. And here's your strategic map to do the same:

1. Map the Customer

For many successful remodelers, the target customer today is not the same as their target customer from a couple of years ago. But their method for mapping the customer is exactly the same. They know who is shopping their services and why.

There are new hot buttons for clients who want to remodel today. Residential real-estate values have dropped an estimated 18 percent over last year, making it harder than ever to sell a house in a market full of inventory. A remodeled home may be the answer to stand out from the competition and attract more buyers.

Other homeowners are also willing to spend now in order to save later. That means offering remodeling projects that introduce green features that benefit the environment and energy-efficient features that save money down the road.

2. Map the Competition

When customers make apple-to-apple comparisons, it's the differences that win or lose jobs. So a remodeler needs to understand what peer remodelers are offering and then go one step further to be the remodeler of choice. That doesn't mean being one step cheaper, either. There are remodelers doing well today who are not the least expensive option in their market. But perhaps they remain busy because they are a more aggressive marketer, they offer that extra level of customer service and they wow the client with more than a job but an experience. When you know where your competitors stand, you know where to leap to distance yourself.

3. Map the Market

Although you cannot control the economy, you can always make it work to your company's benefit. This is that time in a financial cycle when you can recruit great talent who were part of another company's down-size. This is when you can negotiate great deals with suppliers hungry for more business. This is when you can shop better deals with vendors and even readdress old ones. When the economy looks shaky, you should take a position of strength.

Perhaps the person who says it best is world-famous business leader, motivational speaker and best-selling author Ken Blanchard, who advises, “Don't quack like a duck. Soar like an eagle.” When he spoke at my company's national meeting this year, he said he would rather not hear the news or read the papers, because he chooses not to listen to all the negative rhetoric. Rather, he wants to find the positives.

I tend to agree. Every market, regardless of how high or how low, will have its leaders. Now's the time to put together a strategic map to be one of them.

For more Doug Dwyer on Leadership, visit www.ProRemodeler.com


Author Information
Doug Dwyer is president and chief stewarding officer of DreamMaker Bath & Kitchen by Worldwide, one of the nation's largest remodeling franchises. He can be reached at doug.dwyer@dwyergroup.com.

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