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Contractors: How To Find Your ‘Most Important Number’

figure out your most important number

If I asked the average contractor his goal for his business, he’d likely come at me with an annual dollar figure.

$2 million in sales. $10 million in sales. And so on.

While these goals are admirable, they’re also vague and hard to wrap your head around. And since they’re hard to conceptualize, they lack motivation power.

That’s why we encourage contractors to determine their MOST IMPORTANT NUMBER.

Here’s what I mean…

Rather than setting a vague annual sales goal, determine the percentage of sales each product you sell represents.

For example, let’s say your breakdown is 60% windows, 25% siding, 10% roofing, and 5% miscellaneous.

Your “bread and butter” product is obviously windows, so we’ll use that to figure out your numbers (it’s much easier to focus on one thing than on many).

Determine your typical sales price and margin on your average window project, as well as how many window projects you sell every month.

We’ll say your answers are as follows:

  • $8,000 sale price
  • $4,000 margin
  • 8 jobs per month

This means you typically sell 8 window projects for a total of $64,000 and a margin of $32,000. Make this your baseline.

Once you figure out these numbers, ask yourself this:

“To get my business to where it fulfills all my financial goals, how many window projects per month would I need to sell?”

Caveat: I’m not talking about an answer like, “$20 million, so I can party on a yacht like Leonardo DiCaprio.

I’m talking more along the lines of how much you need for the lifestyle you want and give yourself a comfortable retirement.

Take your time and figure out the answer. And then write it down.

(For many folks, the answer is a personal income between $300,000 and $1 million per year.)

Once you’ve written down your number and calculated your sales, your brain is able to focus on the necessary work to achieve your goal. It becomes a simple measuring stick—in a given month, simply compare your results vs. your most important number.

Now let’s say you need 25 jobs per month to reach your most important number. That would work out to $200,000 in sales and $100,000 in margin.

If you achieved that many sales, how much would you spend on marketing to get that number consistently?

Most contractors spend up to 15 percent of the SALE price to get a sale, so that would be an extra $20,400 in marketing. This is in addition to the $9,600 you already spent to get the original $64,000 in sales, so that works out to a total marketing budget of $30,000.

spend money to make money

You need to spend money to make money. Plain and simple.

 

I’m not saying an extra $20,400 is available in cash flow to spend on marketing every month.

And I’m not saying that even if it were that you’d instantly get to 25 sales a month.

BUT…

You now have a formula for succeeding in your business: Spend $30,000 a month on marketing to get to 25 window sales a month.

This much is certain:

NOT spending incremental dollars on marketing is NOT going to get you where you want to go. And this is the major obstacle holding back nearly every single remodeling company I ever talk to.

Instead of thinking in terms of specific budgets required to hit specific numbers of specific kinds of sales, they have big vague numbers that they have no clue how to get to.

Which leads to the final, all-important question: If you DID spend $30,000 a month on marketing JUST FOR WINDOWS, what would you spend it on to get the 25 sales?

I’ll answer that question in my next post. I’ll also show you how easy it is to get the money—believe it or not, it’s probably right under your nose!

But for now, I simply want you to figure out: WHAT IS YOUR MOST IMPORTANT NUMBER?

Knowing this simple number will liberate your brain; you’ll be able to see that your number is not nearly as intimidating as you may have thought.

P.S. Today, we determined your Most Important Number. Tomorrow, I’ll go into the nitty-gritty on how to acquire the marketing budget necessary to get to that magical number. Stay tuned.

Can’t wait until tomorrow? Check out this post that I wrote last year targeted toward smaller and newer remodeling contractors. Caution: It’s stern advice.

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Why Your Marketing Died On The Operating Table

why your contractor marketing died

Wonder why your awesome new website and marketing materials aren’t pulling in leads?

If so, I’ve got bad news…

Your awesome new website and marketing materials are NOT so awesome.

In fact, you’re likely saying the same things 99% of contractors do.

“Quality workmanship.” “Committed to providing a great experience.” “Outstanding service.”

You may bring all that to the table—and then some.

But guess what?

Everyone else says THEY do, too.

And since prospects are beaten over the head with these platitudes, all they hear is Charlie Brown’s teacher when you open your mouth.

So… even though you THINK you’re performing life-saving surgery on your marketing by saying things you BELIEVE to be profound (but are not), you’re actually killing it while it’s on the operating table.

Time of death: Friday, 2:04 PM.

In 2014, I held a webinar called “Stand For Something” that teaches contractors how to stand out from the crowd and create a TRULY powerful, lead-pulling Identity.

Though this webinar is a few years old, it’s as relevant as ever. Maybe it’s even more so now, since people are now spending more on remodeling, and home improvement companies are multiplying like bunnies in springtime.

By watching the webinar, you’ll discover how to set yourself apart and make prospects see YOU as special, unique, and fully equipped to provide them a stellar project.

Here is what you’ll learn:

  • What platitudes are, how to identify them, and why you keep using them even though they don’t work
  • The principles of POWER TALK
  • How to use people’s inherent confirmation bias to your advantage
  • The curse of knowledge: recognize it and eliminate it
  • The difference between an IDENTITY and advertising theme
  • Eight unique identities contractors can use… and how to create your own
  • Before and after examples of websites, advertisements, and brochures that illustrate the concepts

Here’s the link to my “Stand For Something” Webinar. Enjoy.

 

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Should You Snatch Up Unsold Ad Space To Save Money?

discounted advertising space for contractors
Ever heard of “remainder advertising”?

If you haven’t heard the term, you probably know the concept.

Remainder advertising is unsold advertising space in newspapers, magazines, radios, and TV that you can buy for a discounted price.

It’s basically the “clearance” aisle at a department store. It’s the stuff no one wanted, so the seller marks it down because they figure it’s better to sell it at a discount than not at all.

In the past, clients have asked me whether it’s good business to buy remainder advertising.

My answer: It depends on your goals.

I’ll break down remainder advertising into its pros and cons, so you can judge for yourself whether it’s worth buying.

Cons Of Remainder Advertising

Let’s start with the bad.

When you buy remainder advertising, you have little to no control of when or where your ad runs, so you will not reach the same audience consistently. This makes remainder advertising a poor strategy if you’re looking to build a recognizable brand.

Remainder advertising can also be erratic. A station or publication could have two or three spots available one week, and zero spots the next three. It’s a crapshoot.

Pros Of Remainder Advertising

Besides the obvious advantage of saving money on ad space, remainder advertising can be a good direct response vehicle to generate immediate leads.

I’ll give you an example…

Back in 2003, we wanted to generate leads for a business opportunity and didn’t care when the leads came in.

We bought remainder advertising on the Rush Limbaugh show, which was broadcast on 530 radio stations.

The normal rate for a 60-second spot was $24,000, but we bought the show’s remainder advertising for $13,000 per spot. We saved 46% on ad space for one of the most popular radio shows in the country.

The show didn’t always have spots available; like I said, remainder advertising is erratic. But in this case, it served our business needs well because it produced an immediate ROI.

Bottom Line…

If you’re in “hunting” mode (i.e., direct response mode), remainder advertising is a good way to get leads right here, right now.

If, however, you’re a company doing $2 million or more per year that needs to build your brand, you have better avenues for doing so. You need to reach the same audience on a consistent basis to generate business for your company in the future. And you’re not going to do that if you’re randomly popping in and out of stations and publications.

So if you can’t decide whether to snatch up some unsold ad space, first determine your goals. That will give you your answer.

 

P.S. If buying media gives you a brain-splitting migraine, we can do it for you. We’ve bought over $100 million in radio, TV, and print media on behalf of our clients. We’ll meticulously research the market and individual stations/publications, and then negotiate rates that are among the best for those outlets. We can also create powerful, lead-generating ads for you. Find out more here.

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The Invisible Cash-Sucking Parasite That’s Costing You Thousands

contractor reviews

26,380

That’s the number of reviews posted per minute to one of the major online review websites.

Not per week.

Not per day.

Not per hour.

PER MINUTE.

And this is just ONE review website; consumers are leaving thousands of reviews on the 170+ other review websites every minute of every day, too. Who knows how giant the actual number of online reviews posted per minute is across all sites.

The point?

The internet is THE information superhighway, and online reviews fly fast and furious. You’re dead meat you’re not constantly up to date on your online reputation.

If you think I’m joking, consider this…

92% of consumers now read online reviews. And just one to three bad online reviews is enough to deter 67% of those consumers from doing business with a company.

I’m no math whiz, but even I can see how these numbers can completely destroy a company with bad online reviews.

And the worst part is that if you don’t constantly monitor your online reputation, you’ll never know why your sales are tanking, why your appointment book is empty, and why all the leads have dried up.

This is where MYM Online Reputation Management (ORM) swoops in to save the day.

When you utilize our ORM services, we provide you with in-depth weekly reporting covering every single detail of your online reputation.

You’ll know where your online reviews are coming from, your average score, changes to your overall rating, and a whole lot more.

Here’s a look at some of the details in our weekly report:

Reputation Overview

 Reputation Overview

Review Volume And Distribution

 Review Volume And Distribution

Listings Strength
New Reviews

 New Reviews

Total New Reviews
And we don’t just keep our finger on the pulse of your online reputation. We actively bolster it by generating more positive reviews for your company… and potentially preventing negative reviews from ever being posted.

Our ORM leads your customers through a highly effective review funnel, sifting the good reviews from the bad.

The good reviews get posted online; the bad reviews are sent to you, so you have the opportunity to address the unsatisfied customer’s problem BEFORE they submit their review to a third-party review website.

Bottom Line: You could be hemorrhaging thousands of dollars—per day!—if you’re not up to date on your online reputation. (Remember, just one bad review can influence over two-thirds of people considering you.)

With MYM ORM, you get deep insights into your online reputation on a weekly basis. So you not only stop “bleeding green,” you also make more green. MUCH, MUCH more.

Visit our ORM webpage to find out more and get in touch with us about getting set up with our Online Reputation Management.

Be sure to use the free Review Scanner for an instant snapshot of your online reputation’s health.

P.S. You demand to be kept in the loop in every other part of your business—sales, lead flow, budget, production, scheduling, etc.—right? So why neglect your online reputation, which is one of THE most vital factors of your business’s lead generation and revenue?

P.P.S. Next post, I’ll tell you whether buying unsold ad space at a discounted price is ACTUALLY worth it… or whether you’d be better off throwing your money in a pile and lighting it on fire.

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