Thursday 14 August 2014

What Is Your Bid Conversion Ratio?

Posted by at 5:09 PM in

How to Grow Remodeling Company

How many qualified construction jobs do you need in your pipeline to grow remodeling company and make your gross revenue goals for the year?

Many remodeling company owners tell me that they get only 2 out of every 10 jobs they bid on. The industry is competitive and there are many remodeling contractors in the marketplace competing against you.

How often have you put in the time to meet with your potential customer in order to really understand what they are looking to do; you present a great design with a realistic budget - only to have the potential customer choose two men and a hammer who gives them the lowest price. All of that time and all of that effort and you fail to secure the job.

What if you were offered a way to dramatically improve your conversion rate?

Let me show you how!

How many jobs do you get, and how many do you bid on to get those?

Knowing and understanding your conversion ratio is as important as tracking your closing rate. If your goal is to complete $500,000 of work annually and your average size job is $25,000, you need to complete 20 jobs a year. But if your conversion of qualified opportunities is 20%, you need $2,500,000, or 100 qualified opportunities to reach your goal.

That is a lot!

Knowing the total number of qualified opportunities to reach your revenue goal sets the stage to reverse engineer to determine your most effective sales and closing strategies to reach this target. Analyzing your sales processes will help you better assess your effectiveness at each step of your process so you can make needed changes that will produce the most impact.

The two most effective ways to dramatically improve your conversion ratio and grow a remodeling company are:

1) Grow a remodeling company by becoming an Insurance damage repair contractor and begin receiving work by direct assignment from the carrier as a preferred program contractor.

What contractor does not want to be an insurance preferred vendor? The results can be huge. Imagine a steady volume of business. No bidding. No competing. Just getting the assignment and doing the work, and whatever work you complete today will be replaced by more assignments tomorrow. What could be more perfect?

2) Grow a remodeling company by becoming adding referral sourcing to your current lead generation efforts.

Referral sourcing is different is different from lead generation. It is important to understand this difference. The difference is that when you gain a lead through referral the source has already laid the ground work for you. There is already a bias on the part of the customer to want use you because you have been referred by someone they know and trust. Warm referrals are much more powerful an opportunity, than a cold lead, and can dramatically change your growth trajectory. Examples of referral sources that can help grow a remodeling company include:

  • Third Party Administrator
  • Insurance Companies
  • Insurance Agents
  • Government Agencies
  • Local fire source referrals
  • Plumbing contractors
  • Others

Remodeling contractors can continue to bid their remodeling jobs and continue to get a 2 out of 10 conversion rate or up their game through many of the best referral sources in the marketplace. This will dramatically increase your closure rate and dramatically increase your sales. You just need to know where to find these sources and how best to make contact with them.

Call me for a FREE 30 Minute Consultation and let's talk about how to add several of these key referral sources to your sales sources today. Visit my website at www.growmyrestorationbusiness.com for more valuable material that helps owners grow a remodeling company.