It was Spring 2004. The prospect standing in front of me was requesting a bid for a project that included a custom stone wall, pond, fireplace, flagstone patio and pergola to go along with the rest of the landscaping work at their new home. The wheels in my head were turning fast; this was a $90,000 project at least. A great referral had put me in front of this homeowner, and the rapport between us was excellent. To top it off, I was bidding against my former employer. I wanted this job!
But did I really need this project? Was it the right fit for my young company?
While I drove back to my office, I thought about how this project was going to be a gamechanger for our company. As it turns it out, it was—just not in the way that I was envisioning.
I started to work on the proposal, and quickly realized my team lacked the ability to perform the work on this project. I didn’t even have qualified contacts to utilize as subcontractors for some of the elements.
Risk it or release it?
It’s easy in a boom town to chase every lead. When there’s opportunity around every corner, wouldn’t it be logical, with the abundance of work, to chase only what you do best? Shouldn’t you aim to close sales at the profit margin you want and perform work that is comfortable for your team?
In my case, I let that dream job go. Turning down the opportunity was difficult, but my honesty with the prospect brought us more credibility in the market and other referrals.
It was at that point we started to look for projects that we were confident in and knew would be profitable for us. We focused on these, job-costing each project to find where we were making the most profit, and developing systems and processes to gain reliable results.
As the business grew, we were able to take on more challenging work. At each evolutionary stage of our company, we revised our marketing materials to showcase the type of projects we were comfortable with and that would bring us the profits we were expecting.
This sounds easy, but to do it you must have a plan. Start by answering these five questions:
- As an organization, what do we stand for; who are we as a group?
- What service or product do we offer our clients?
- How are we providing this service or product that makes us different from others?
- As an organization, why do we show up for work each day?
- What are the demographic and psychographic details of our primary and supporting customers?
Focusing on these answers will reap endless rewards, now and in a slow market.
Dan Farley is president and strategic planner at Confluence Strategy, and the founder and former owner of Renovations Landscaping, Inc. in Castle Rock. He can be reached at [email protected].