10 Tips for Growing Your Electrical Business in 2021
There is no doubt that the current electrical construction market is hurting. The question is, why are some companies producing record quarterly results while others are closing their doors? One explanation has to do with market share. Electrical contracting companies are by nature very fragmented. Even the largest companies on EC&M's Top 50 Electrical Contractors list have only about 0.5 percent market share, while the bottom-ranked players have about 0.1 percent market share. The remaining approximately 60,000 electrical contractors have a significantly smaller market share. Why is this relevant?
The point is that even the largest electrical contractors don't need to do much more in terms of market share to maintain or even make progress in this economy. If they can do it, so can you. Here are 10 grassroots marketing efforts that can help you deliver consistent results for your company's growth in the current economic environment.
Tip 1 - Take care of your contact database
You won't be trying to manage your accounting and job costing, everyone keeps track of themselves (with little or no management oversight), but many contractors keep their contacts in random systems, from business card files to personal Microsoft Outlook files. Even those companies that do have integrated contact management systems rarely have clean, complete, and up-to-date data in their files (see sidebar: The Three C's of Contact Data Management).
The first step in improving your business development process should be to consolidate all your contacts into one central database. Most companies use Microsoft Exchange to send and receive email and work well using only public folders as contacts. In addition to this, there are many customer relationship management (CRM) systems that can be customized to suit your needs.
Make sure this becomes an ongoing activity with regular reports to show you the status of your contacts, including last contact date, new contacts, and missing contact data. The importance of this activity cannot be overstated. While the work of integrating contact data is tedious, it is worth the effort.
Tip 2 - Take advantage of meeting opportunities
If you are a large contractor with an impressive building, fleet, large staff, and a way to showcase your capabilities, be sure to bring the owner and general contractor (GC) to you. Show them that you're not the typical subcontractor they think you are - and that you have the facilities and operational capabilities to handle their highest level projects and needs. Office equipment that can easily handle drawings and quickly generate submittals, tool management and tracking systems, on-site material storage, and dedicated prefabrication areas all demonstrate your professionalism and ability to provide the immediate notification.
If your facility is still a "work in progress", you may want to consider bringing your team to your client's office. This approach has some distinct advantages, not the least of which is that you don't have to worry about them not showing up. While people usually have good intentions, you do run the risk of a small presentation when you invite potential clients to your facility. Not only do you have the opportunity to have more face-to-face interaction with more key players, but your clients are more comfortable in their place of business. Recommend a morning session; people have had their coffee and are still fresh. It will give you at least an hour before noon and offer the opportunity to take people to lunch after the session. Make sure you'
The purpose of these meetings is to expand your company's relationships by going out and meeting new people. You will want to make as many connections as possible during this event (click here to view the chart). Get your best team together, consisting of two to five people. Gather your strongest participants, depending on the size of the meeting or prospect, and leave marketing materials and other fancy props behind. People want to do business with others who share common experiences, goals, and business ideas. That's what you'll be discussing.
Tip #3 - Cultivate Team Relationships
Projects are granted by people to people. Of course, there are other dynamics, such as pricing, but the information that can lead to a successful contract win for an electrical contractor is closely tied to relationships.
Think of vendors who give you pause on pricing and inform you of potential projects in the market. Think of good contact with a GC who will "advise you" on your scope and pricing - even on a public works project. Think of your "nickname" (better than name) facilities manager who does all the work for you and never questions the bill.
If these things rarely or never happen in your company, then you need to pay more attention to relationships. If they do, then consider their value and consider what value there would be in significantly increasing the number of these relationships.
Relationships are the cornerstone of most, if not all, business transactions. Everyone in your organization undoubtedly has a relationship with someone who can bring value to your company. Imagine how many relationships you would have if you put all of your service technicians, foremen, project managers, estimators, etc. together and leverage each of their experiences.
Depending on the number of employees you have and their work experience, you will need to determine the most effective way to gather passionate prospects within your organization. If there is a group, it may be effective to set up a roundtable to compare the opinions of previous and current customers. This opens up the discussion and gets people thinking about connections they may not have considered. It also allows you to identify some important target customers as a group based on previous relationships. For larger teams, it is best to break the team into smaller groups of 3 to 5 people or assign one person to manage the process by going to each person individually and working to consolidate their contacts into a centralized database (as described in Tip #1).
Simply encouraging everyone in the organization to reach out to old relationships and some new ones every week can yield amazing results. A team of five people reaching out five times a week (new or old) equates to more than 1,200 customer contacts per year! The key here is consistency.
Tip 4 - Inspire Mouth-to-Mouth References
When we consider painting our homes, we rarely open the Yellow Pages in the "Painters" section and start dialing. Chances are you know a neighbor, friend, or relative who has recently painted home. This is the first person you contact for a referral. Word of mouth is a simple concept that can lead to widespread success or failure.
So how do you make this opportunity work for you? Of course, the absolute best "brand building" tool is to provide excellent service to your customers (as defined by them). How do you blow this opportunity? Provide poor customer service and you will soon realize the power of this form of communication. As they say, bad news travels fast.
Branding is a great way to keep people in mind. Your brand recognition is an accumulation of experiences that reflect your company's values. Anywhere you might have a potential customer can be a brand touchpoint - your business cards at meetings, attitude, staff service in public, clean company vehicles, professional dress code, helmets with your logo, and strategically placed stickers a project's completion.
Tip 5 - Leverage your design capabilities
In-house drawing and drafting capabilities can give you a competitive edge in project negotiations. Value engineering and the ability to solve client problems through design and modification (i.e., design-build) can be a stronger selling point when building relationships with architects, engineers, and owners. Almost every contractor is involved in design in some way - even if it's just through a cooperative program with a local electrical engineering firm. Your job is to demonstrate these capabilities and work to expand them.
While the details of building your design capabilities are beyond the scope of this article, we want to touch on some key points.
Use CAD tools to plan work for areas such as baseboards and powerhouses, rather than having a foreman sketch them in the field. Even if it seems inefficient in the short term, the skills you gain will serve you well in the long run.
If you're involved in new building construction, start learning 3D BIM technology - if you're not already using it. It's a design technology that will have a major impact on the entire industry. It looks a lot scarier than it is - starts by detailing powerhouses and ceilings after you've mastered 2D technology.
Check out the GPS positioning techniques that are relevant to your layout. These can save time and improve quality.
Learn to show this work to your customers. Create examples and case studies to demonstrate your capabilities and quantify the results in terms of days saved on the schedule, minimized rework, improved quality, and/or reduced costs.
Tip 6 - Expand Your Reach by Delivering Services
The job is done and you leave, right? Wrong! A warranty call is one of the last things a contractor wants to hear after a project is completed. It means, without a doubt, that something is wrong and that the minimum profit you made on the job is now in jeopardy because you need to spend a penny on repairs.
Instead of thinking of the warranty period as a time you have to wait before you get out of the woods, think of it as a way to introduce your company to the facility owner. As an electrical contractor, your exposure during a project is usually related to the GC. You work for them, communicate with them, and then wait for them to pay you.
After the job is done, there is still an owner or end-user who will most likely need your services in the future. An easy way to build a relationship with that end-user is to introduce your "warranty team". When you visit or call, explain that you want to make sure the end-user has all of your contact information in case there are any problems with the installed system, and you immediately establish yourself and your team as a proactive contractor.
You are not asking for the business. You are separating yourself from the GC while providing a solution. Holding meetings with owners or end-users or going from field foreman/project manager to service manager or warranty team allows you to further sell your company. You can provide additional services such as lighting maintenance, tenant improvements, and emergency services while managing the warranty period.
Remember that word-of-mouth thing? This is a great opportunity to make a splash in the field and help your company stand out. Also, remember that while service revenue may be relatively small compared to contract revenue, the margins are much higher and the risks are much lower. Building your services division will help increase the top line, bottom line, and overall value of your business.
Tip 7 - Define your marketing strategy
Successful organizations, large and small, have a clearly defined marketing strategy and plan. Can you clearly define the following?
What types of efforts have generated revenue/profit for you in the last three years? How much of each?
Where do you see your future revenue/profit coming from?
What geographic areas do you currently serve? Who would you like to serve in the future?
Do you have the skills and resources to answer the second and third questions? If so, are you demonstrating this effect in your marketing materials and presentations? If not, what are you doing to build those skills and resources?
If almost everyone in your company can't answer these questions, then you will have a hard time bringing everyone together for a specific marketing project. Your company's marketing is a collective effort. Everything from the way a receptionist handles a call to submitting a proposal will get you closer to (or away from) your next client or project.
Communicating your efforts, successes and failures help eliminate wasted time and repetitive mistakes. Make sure your team understands that your overall goal is to generate revenue, not waste scarce expenses.
Tip 8 - Survey your customers
Six months after you complete your project, do your customers remember you? If they do, is it in a positive way? If you can't answer that question, then ask them. In general, people spend so much time "selling and telling" prospects what they can do, they often forget to step back and listen.
Calling past clients and asking them a few simple questions can lead to fantastic insight, which often leads to referrals and additional work. There are many ways to conduct a customer survey. The important things to address when developing a survey are to make sure it is (1) structured, (2) conducted regularly, (3) feedback is returned to the project team so they can make changes, and (4) ) the customer is notified of the changes you make based on his feedback.
The survey will also help you clean up your contact database and refine your marketing strategy. The simple process of talking to all your past customers - and then passing the feedback on to your team - can be a very valuable tool.
Tip 9 - Force Open Lines of Communication
Educate everyone about the sales company and its full capabilities. During the project, project managers and foremen should be comfortable talking to owner representatives and GCs. Open lines of communication often result in hearing about upcoming project opportunities and being introduced to other potential clients and decision-makers. Regularly communicating with your clients about progress, problems and solutions will instill the level of confidence needed to build strong relationships.
The people you work with rarely understand the complexity of the work you are completing or the services you provide, and they don't care. The system behind the wall doesn't matter to them because the project is completed on time, on budget, and everything goes as expected when you leave. What they do understand is communication.
Do what you say you'll do, and when you say you'll do it, it's a powerful tool. While on the surface this doesn't look like marketing, it is the essence of building your business. This is why you will (or won't) be invited to bid on your next project. It's also why you will or will not be recommended to the next owner, architect, or GC.
Tip 10 - Keep an eye on emerging trends
Investing a few dollars and a little time to learn about solar and wind technologies, green building requirements, lean building practices, and building information modeling (BIM) software can pay huge dividends in terms of relationship building. Attending a seminar on lean construction with your project team will not only improve your bottom line but may also introduce you to some GCs you didn't know about before. going through the LEED (green building) certification process will put you in the same room with architects and possible building owners. Taking a little time to learn about alternative energy and being a source of information for your clients and prospects will have a huge impact on your perceptions.
While we have intentionally not covered certain marketing basics, such as direct mail, newsletters, and marketing collateral, that doesn't mean we don't believe in them. These topics have been covered extensively in other articles, and we don't typically see more questions in these areas than companies that don't provide the 10 tips discussed in this article.
Holding a 10-minute marketing meeting and trying to "meet and greet" a few target customers in the next hour will yield better results than spending months preparing the "perfect" marketing plan.
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