Greg Hayne, Owner, Hayne Coaching Group
Most commercial roofing contractors don’t care about service. Many say they do, think and even pretend they do but their actions say otherwise. They are “pretenders.” Some of this is very understandable. To get a $150,000 reroof or a $1,500 service repair project from a first-time, never-worked-with-them-before client can require the same amount of effort from you. The gross profit from that reroof project can be $60,000 but only $1,000 for the service project. So, for a contractor to focus on selling projects makes excellent financial sense and the industry is full of contractors who have, for decades, used that business model with great success. For new contractors just starting in business, selling projects is almost certainly the best route forward to a successful business. The only contractors I know of that started into business with a “service-only” business model that have been successful have had some unique factors in their favor that most do not have.
Generally, the typical commercial roofing contractor who has been in business for 10-plus years will have service revenue in the range of 10-15 percent of their total revenue. These are the “pretenders.” For most, this happens by being purely reactive. A commercial roofer with a true focus on service will have service revenue of 25-40 percent of their total revenue. These are the truly great commercial service contractors. Economic swings have far less impact on
service-focused contractors. Their project work runs at higher profit margins and they often have projects simply handed to them. They tell me (when no one else is listening) that their stress levels are much lower than those of the
project-focused pretenders. Which are you? Oh, and if your service revenue is less than 10 percent of your total revenue and you have been in business for more than 10 years, you are actively doing things that serve to drive your customers away from you.
Let’s proceed with the idea that you want to improve service to your customers and are willing to do the necessary work. In my work, training roofing contractors service departments, over the last 15-plus years, I see a couple of points that trip you up either because you are doing something you shouldn’t or are not doing something you should.
The number one reason pretenders stay pretenders is because of the lack of appropriate engagement by the owner of the company. The typical service managers like doing the same thing, the same way, every day. You absolutely need that for a service department to run effectively. These ideal managers are, in a word, perfectionists. However, individuals with that personality style are also risk averse, terrified of making mistakes, not entrepreneurial and are generally not good at customer service. (And you wonder why your department doesn’t grow?) If your department is not growing, this is the number one reason why. You have the wrong person in charge. To move from pretender to contender, you, the owner, must lead. Be engaged and take charge because you are the entrepreneur; you are a risk taker and you are willing to make mistakes in order to grow.
You install roofs and over time they leak. Customers call you and you go fix the leaks. That is how you get 10-15 percent of your total revenue in service. If you want a significantly higher percentage of your revenue to come from service, you will have to actually “sell” your services. Having an estimator load a quote into an email and clicking it out the door is not selling. It is bidding.
It’s Monday morning and you get a call from the foreman on the tear-off down the street from your office. He says, “Hey, we had two guys not show up this morning and I am concerned it is going to rain this afternoon. Can you get me some bodies up here to help with the tear-off so I can get this dried in before the rain?” You say, sure, no problem. You run out of our office down to the accounting department and tell the two women working there to grab their hard hats, safety glasses, boots and work gloves and go help with the tear-off. Right? No, it would be kind of dumb, wouldn’t it? Then why do you expect estimators to sell work? It’s exactly the same thing. Those two ladies can go to that jobsite, they can pick up the tear-off, put it on the buggy, wheel it to the edge and dump it down the chute. But that doesn’t mean it worked or was a good idea. Just because an estimator closes a service sale doesn’t mean it worked or was a good idea any more than having your bookkeepers help with a tear-off. You need people whose role is to actually build relationships with building owners and to sell. This is an area where residential roofers are generally way ahead of commercial roofers in terms of sophistication. They recognize the value of a true salesperson.
Another example of a mistake pretenders tend to make – you decide to take your spouse’s car shopping. You walk into the dealership and the greeter says, “just a minute, let me get someone for you.” Soon, a guy in greasy coveralls comes out of the back of the dealership wiping grease off his hands onto a rag. He walks up and points to one of the cars on the showroom floor and says, “You should buy this one. It’s a really good car.” Is that what happens? No, of course not. But the thing is, that mechanic knows WAY more about cars than the salesperson that actually connects with you. Why do dealerships do that? Because the dealership understands that a true salesperson knows how to build and close relationships. Your salespeople don’t need to know anything about roofs to be effective. But pretenders really struggle with this. (I know more than one contractor, and all of them are contenders, who won’t even allow their salespeople to go up on a roof. By keeping the salespeople relatively uninformed on the technical aspects of roofing, it forces them to focus on the relationship aspect.) That isn’t to say that a salesperson with roofing knowledge and experience can’t be successful. It’s just that you should hire salespeople based on their sales ability and not their roofing knowledge. Why does this rarely happen with pretenders? Because the decision makers (owners) can’t get their heads wrapped around the idea that service is about relationships, not roofs.
In order to move from pretender to contender, the owner needs to be appropriately engaged in growing the department and, at some point, real, genuine salespeople, who are focused on building relationships, are going to need to appear to expand your customer base.
Greg Hayne is the owner of Hayne Coaching Group and he coaches, trains and supports commercial roofers to build better and more profitable businesses through his Educate, Stimulate, Expand (ESE) peer groups. He also helps them build better service departments through his Creating Great Service training and support program. Visit www.haynecoachinggroup.com for more on how Greg can help you grow your business.
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