Financing, marketing, networking
Most contractors are familiar with revolving plans.
You love designing hydronic systems. It’s not enough. Your installations are works of art. It’s not enough. You can troubleshoot and fix anything with water running through it. It’s not enough. Unless you become good in the following three areas your business will struggle no matter how good you are with a wrench.
Learn how to use financing
Your customers may appear to be extremely wealthy. That doesn’t mean they have cash lying around to pay for a hydronics installation. High income does not always equate to high disposable income. Their income may already be wrapped up in the mortgage, car payments, college tuition and so on. Even if they turn it down, assume they want your help to arrange financing. This means you need to have financing solutions arranged before the sale.
The two basic types of financing are installment and revolving. Most contractors are familiar with revolving plans. They are easy to use since the payment equates 2% to 3% of the outstanding balance, regardless of the rate. Essentially, a revolving plan is a credit card without the card. It might be good for emergencies, but it is not a great long-term solution.
The other type of financing is installment with a fixed number of equal payments, such as a mortgage. The beauty of installment financing is you can extend the term of the note to more closely match the life of the products. Moreover, extending the term lowers the payment more than lowering the interest rate. With a 10-year note, the payments shrink significantly and more extensive installations become affordable.
Arrange for multiple sources of financing. You should have a revolving plan available for expensive repairs, if nothing else. Your go-to plan should be installment financing with terms up to 10 years. Also, check into utility financing. Some utilities offer very creative and lucrative programs.
When you present the homeowner with options, include the total price in the paperwork, but emphasize the payment. People think in terms of cash flow and payments. If a prospect can afford the payment, he can afford the system.
Learn how to market
To be blunt, most hydronics contractors are horrible marketers. They justify their ineptitude by proclaiming that marketing is too expensive and often a waste of money. Marketing can be expensive and some of it inevitably is wasteful, but it does not need to be either. Focus on a few simple things to start.
Make sure your truck is well wrapped with good contrast, a large logo and minimal clutter. More people will see your truck wrap than any other marketing you do.
Make sure you have a strong website that’s optimized for search engines. The industry offers services for contractors with predesigned templates that are easy to use, professional in appearance and very affordable.
Prepare collateral material, such as business cards, invoices, door hangers and leave-behinds that all are consistent. Create a company brochure that mirrors your website. These are inexpensive and essential.
Take full advantage of social media and email marketing. Put together a Facebook page, establish a Google Local page and collect email addresses for a monthly consumer-oriented email with a coupon. Use Pinterest because many women use it and they are your customers.
Take the time to get involved with any group where you can make lots of personal connections. If the group involves community centers of influence, that’s so much the better. Join a service club, such as Rotary, Lions, Kiwanis, Optimist or Civitan. Most of these clubs meet over breakfast or lunch and are filled with community centers of influence. One day a week you can skip the heart attack in a sack and spend time with people who are connected and can recommend you.
You should join the Chamber of Commerce, but do more than merely join. Get involved. Attend the chamber mixers. These are where you will make connections.
Find a leads club in your community, either a local one or one of the national groups such as BNI or Le Tip. These are groups of noncompetitive businesses that get together to help one another generate business. Members offer suggestions, make introductions and give referrals.
Do not overlook nonbusiness oriented groups such as alumni groups, shared interest organizations and church groups (e.g., a church men’s group). You cannot walk into these groups flashing your business card, but you can make connections with people and build relationships. In the end, almost all business is built on relationships.