Mediation as a marketing tool

Stephen C. Gidley has spent a lot of time over the past 20 years trying to avoid court. President of Stephen C. Gidley Inc. & Associated Building Contractors in Darien, Conn., he hasn’t had to defend his company.

January 31, 2002

Gidley’s code of ethics

  •  Investigate the quality of subs’ work and their financial stability.
  •  Pay suppliers net 10 days upon receipt of invoices.
  •  Give staff employees profit sharing, medical benefits and a retirement plan.
  •  Guarantee work in writing, in many cases offering a lifetime war-ranty.
  •  Disclose all facts and cost figures to clients.
  •  Survey every customer from the prior year each January.
  •  Mediate disputes between dissatisfied homeowners and other contractors.
  •  Offer discounts to clients who are elderly or on welfare.
  • Return customers’ calls the same day.

    Business information

  • $3 million annual sales volume
  • 150 annual jobs, ranging from $5,000 to $1.5 million
  • 3 employees, 75 subs
  • 50% remodeling, 50% painting and roofing
  • 90% client retention rate
  • .1% callback rate on installations
  • 95% of customers agree to give out home phone and address as references
  • Stephen C. Gidley has spent a lot of time over the past 20 years trying to avoid court. President of Stephen C. Gidley Inc. & Associated Building Contractors in Darien, Conn., he hasn’t had to defend his company. Rather, he has positioned himself between litigious homeowners and nervous contractors in an effort to resolve their disputes without legal action.

    The work has paid off for Stephen C. Gidley Inc., as well as for those he helps. Besides establishing his 34-year-old painting, roofing and remodeling firm as a trusted household name, Gidley’s mediation skill has earned sizable consulting fees and given him the opportunity to create a small forest’s worth of local press.

    “I make a nice little piece of change, the homeowner has a home that doesn’t leak, and the contractor saved himself a lawsuit,” says Gidley, CGR, GMB, CGB. “It’s a win-win-win.”

    In the past three years, Gidley has worked two pro bono cases in conjunction with the state attorney general’s office and been a paid consultant to homeowners in six other instances. The two most common complaints, he says, are a) that the contractor didn’t finish the work and won’t return phone calls, and b) the workmanship isn’t satisfactory, and the contractor won’t make good on it.

    “Usually the meat of the complaint is legitimate,” Gidley says. In fact, in the private cases, homeowners don’t come to him looking for a mediator but for someone to finish the job. To avoid taking on an expensive, messy cleanup job, he suggests that the consumer hire him to work things out with the existing contractor. The work involves explaining industry standards to the homeowner, supervising the rest of the construction, and convincing the contractor to swallow his or her pride and return to the job.

    At a standard rate of $200 per hour, that usually adds up to $1,000 to $2,500 for Gidley, and saves the customer $5,000 to $20,000.

    If the customer is a former client of his, however, Gidley will do the job to win the client back and prove his company’s work is worth its higher prices. In one instance, a contractor put 12 skylights on the homeowners’ account at a local lumberyard and then sold them. That time, the police stepped in, and Gidley stuck to fixing headers that had been installed incorrectly and jack studs that had not been installed at all. It was an $80,000 job, and two years later, when the homeowners were ready to put an addition on their house, they returned to Gidley for the $126,000 project.

    Stephen C. Gidley Inc. won the Better Business Bureau’s National Torch Award for Marketplace Ethics in 2000, the first year that a category for companies with up to 10 employees existed. Neil Kelly Co. in Portland, Ore., is the only other remodeling or construction company to have won.

    The award wasn’t a surprise; it was part of Gidley’s strategic plan. “The biggest thing is to have aligned myself with the Better Business Bureau,” says Gidley, a member of the Connecticut BBB’s board of directors. “It stands for the best in business and the integration of business and consumers.”

    The strategic plan also includes extensive marketing of his ethical practices and awards through press releases, many of which the former English major writes himself. “I take building my image as seriously as I take all the jobs we do,” he says. “The most powerful tool in building a remodeling business is all the awards and accolades and press.”

    He adds, “My philosophy is, I’m doing something for the community that in return has made me a happy, well-to-do contractor.”

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