Innovative products and business owners packed the show floor at the 2015 NWFA Expo in St. Louis. (Photo: David Stluka)
Our finish manufacturer, ArboritecUSA, invited me to join the company’s salespeople in the booth at this year’s NWFA Expo in St. Louis. Instead of walking the trade show floor looking at all of the incredibly innovative products and technologies offered in 2015, I spent hours communicating with the front lines of the hardwood flooring industry: wood flooring contractors who have amassed and demonstrated a great deal of specialized knowledge and skills in our industry. I might have met you if you attended the NWFA Expo. While most of you possess an impressive skill set, I admired the fact that each of you also realizes you are more than simply a contractor: You are a client and consumer, you are an industry insider, you are a business owner, and most of you are responsible for setting and raising the standards of our trade.
Here are a few best practices I heard about from contractor business owners I met in St. Louis. Manufacturers and dealers, I invite you to read on, as well. You might learn a thing or two from the artisans who take your product to the next level and build a solid foundation for a home’s or business’s design.
1) Manage expectations
What good are the NWFA Expo education and technical training sessions if you aren’t teaching your client? Don’t fear the word “no.” Most of your clients will respect you more if you decline conditions or products that could fail, especially if you have a solid reason why. If they don’t respect you now, they’ll certainly respect you when it does fail. (Who doesn’t have that story to tell?) Contractors I visited with in St. Louis agreed that it is vital to our industry’s success to set and manage expectations. Yes, site-finished is great in some conditions and engineered is great in others. Tell your clients what those are. The clients who are worth your time will appreciate your knowledge. The ones who ignore your expertise and advice are usually the ones who won’t value your work, your pricing or your time. More time spent on the front end of your transaction means less time spent at the back end, when you get paid. And I’ve seen your work; you deserve the compensation.
2) Consider Your Contract
I have had builders tell both Joe and me that they’re honorable enough to shake hands on a business decision. Perfect; if that’s the case, they should be honorable enough to sign a piece of paper.
It. Is. Not. An. Estimate. Seriously. Because it binds both parties to the scope of work so that intentions become commitments and you get paid (see above). You’ve worked too hard to leave yourself and your family open to financial risk. Yes, provide your clients with a written estimate (especially if you’re optioning add-ons or upgrades or various products). Once your client has made a decision, detail that scope of work inside a contract and have all parties (and everyone with a name on the deed) sign and date. This may seem like a hassle, but it’s your insurance policy. If you understand the value of liability insurance, you probably understand the value of those signatures on a work contract. I have had builders tell both Joe and me that they’re honorable enough to shake hands on a business decision. Perfect; if that’s the case, they should be honorable enough to sign a piece of paper. Handshakes are fine for introductions and intentions, not legal matters. The NWFA offers a sample contract for members to use. Start with that, and, as you experience various projects, add to it as you need with the help of a legal service.
3) Specialize
… and then market your specialty all day long by memorizing exactly what sets your business apart from others. Most people respect an authority, especially with a product they’re going to walk all over all day long. Wear your logo with pride on a shirt to bid work and while you work. It is an inexpensive opportunity to share your business on and off the jobsite. Wrap your vehicles. It tells your prospect that you’re invested in and proud of your work. Whenever I meet someone new, the first thing they learn about our business is that we offer “Denver’s only nationally certified wood flooring advanced master craftsman.” Did you hear “low price leader” in that sentence? I think not. What sets you apart? Will it matter to the homeowner or builder if you’re not installing the hardwood flooring? Because if what you offer doesn’t matter to the homeowner, general contractor, or builder, you’re only competing on price. There’s a difference between specialization and commoditization. During an education session in St. Louis, Tom Jennings, World Floor Coverings Association (WFCA), gave a very useful presentation to help professionals sell their products and services.
4) Measure your effectiveness.
During the initial phone call, at the estimate and on the job site, what worked and what didn’t? A lot of contractors I spoke with request reviews/testimonials from their clients, but how many incentivize them? I don’t mean the good reviews, but all of your reviews. Our clients receive a mop kit in return for reviewing our business on Houzz. Instead of spending your last few moments in a client’s presence with your hand out receiving a check or taking their credit card number, perhaps a better way to end the transaction is delivering a gift in exchange for a few minutes of your client’s time. One company uses a scale called Net Promoter Score (NPS). By asking clients one simple question—How likely is it that you would recommend (my business) to a friend or colleague?—you can get a clear measure of your performance through your customer’s eyes, which can be great to use as you market your product and service to others. Don’t forget the business side of your business. What was your profit margin? Is your cash flowing, and what does your P&L look like? Bree Urech-Boyle, NWFA CFO, spent an education session covering some of the basics in financial intelligence to ensure we are operating our businesses correctly. While you may have started your business for many different reasons, you can’t stay in business if you don’t consistently measure, assess and reinvent when necessary.
Interactions with contractors and other industry leaders on the trade show floor and education sessions during the NWFA’s 2015 Expo provided me with a better understanding and appreciation of the fact that, in order to succeed, we must be savvy business owners in addition to being skilled at what we produce, especially in this economic environment in which “value” has come to represent commoditization. We’ve all seen Wal-Mart’s “Great Value” slogan, and that works for Wal-Mart. But will it work for you, your business and our industry as a whole? I challenge you to consider elevating our industry within your reach by incorporating some of these ideas from the best of the best: contractors around the world who exemplify excellence in both technical standards and business acumen.
