Three Common Mistakes Made Selling In Construction And What To Do About It

As the pace of commercial construction picks up, you may not think there is any need to improve in the area of sales. Perhaps you feel there is no need to work harder. You are already working harder than company leaders in most industries, right? Matt Pletzer of Lift Consulting in Madison, Wisconsin, recommends you work smarter, not harder. Lift Consulting focuses on assisting organizations with skill development, staffing solutions and structure and strategy development.

MattSo how do you work smarter?  Pletzer offers three common mistakes that professionals in the construction industry make as it relates to selling:

Mistake Number 1: Honoring your prospective clients time more than your own.

“I’m sure many of you have had to deal with the prospective client that says ‘I’m going to get multiple quotes’ or puts you into their RFP process,” Pletzer says. “In sales we believe there is something called ‘mutual business stature.’  To obtain mutual business stature both parties must have the stated ability to tell the other party that the relationship is or is not going to work.  In the construction industry, because it is the stated norm, many people fall victim to not establishing mutual business stature with their prospects,” Pletzer says.

Pletzer says contractors should ask themselves how much time it takes to prepare an accurate quote?  If you multiply that out by an hourly rate, how much money do you have tied up just in the bidding process?  “I once had a client tell me he spent 40 hours per quote.  This was before he ever even knew if he was going to be awarded the business.  If he got the business his bill rate went down significantly, if he didn’t it was devastating to him as he had no way to recoup that sunk cost,” Pletzer says.

Pletzer says if someone is going to get multiple bids or ask you to participate in an RFP you have a right to say no or ask for something in return.  He says in some cases that could be an opportunity to work with the vendor to shape the RFP, in other cases that could be the request to be the last stop before your prospective client makes a decision, so at least by the end of the time the proposal is presented you know where you stand.

Mistake #2: Selling with Features and Benefits

Pletzer says it’s very common for companies to reference the benefits of their products or services that may not be any different than what competitors are saying.

“Are they unique or different from what your closest competitor is saying?  Likely, they are not,” Pletzer says.  “Although you may indeed provide better service, have more experience, etc. If your competitors are saying the same thing, how difficult do you think it would be for your prospective clients to discern who they should do business with? I’d argue very!”

Pletzer says you should ask questions to show your expertise and discover the real reason your prospective clients need you or your services. “All too often people feel smarter by sharing their knowledge. With that said, however, if you can help a prospective client “self-discover” what they are looking for and what’s important to them, through asking directed questions – you will sell more than selling features and benefits.  As when you sell with a feature or benefit you are taking a 50/50 gamble that it is going to resonate with your prospective client.  Which means likely your closing ration is 50% or worse,” Pletzer says.

Mistake #3: Not taking your prospective client’s budget to heart

Pletzer says he typically sees construction firms coming back to the prospective client with a proposal just at the top of the prospects budget or slightly higher; or the bid may even come back significantly higher than the prospects budget.  “Typically that is because the scope of the project changed, and like many people, the ‘buyer’ gets excited about things that they ‘want’ to have included.  The problem with this is that ‘wants’ are often not ‘needs.’”

Pletzer says the construction representative get wrapped up in your prospective client’s needs, without helping them discern whether they really “need” this or that additional feature and don’t circle back to their original stated budget, you are doing yourself a disservice.

“So next time your prospective client states a budget, seek to understand first what the limitations are within that budget.  Is that really the budget or would they be willing to spend more if they found a better solution?  If they would, how much more? Never position your solution outside of your prospective client’s budget, as all you are doing at that point in time is empowering them with a reason not to do business with you rather than to do business.

Pletzer says if you can avoid making these mistakes your sales will increase exponentially.  That does not mean however that you must work harder or take on more jobs, but rather he says it means you will close more deals quicker, and potentially increase your net profit per deal.

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