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Saturday, December 22, 2007

"The process"

Overbuilders Construction Services in Denver, CO, uses a similar system, also called "The Process". Instead of saying there are no free estimates, the contractor says the initial consultation "our no-obligation TimeSaver Estimates are always free, so the initial phone call is very easy to make."

Sonny Lykos has graciously sent me a document that is a worthy resource for any renovator or residential contractor. "The Process" is provided to homeowners after the initial inquiry -- and establishes the guidelines for the working relationship including the fact that there are "no free estimates".

Yes, you can get a ballpark idea of the project's scope and an idea of whether the planned work will be within your budget -- but if you want anything detailed, or serious, you'll need to agree to have a Specification and Cost Analysis (SCA) and pay for it (cost to be applied to the total project if you go ahead with the work).

The multi-page document also addresses scheduling, change orders and the problems and issues that can occur during any project. Most importantly, it outlines in a straightforward manner, the actual process -- step by step.

This document has several advantages. First, it helps to build trust between the contractor and the homeowner. You don't need to worry about crucial unanswered questions. Second, it pre-empts bidding games and (to some extent) "low bid wins the job" competition -- if you want to get serious with Lykos' organization, and receive a meaningful quote, you are going to need to commit (and pay for) the SCA. Finally, it actually simplifies and stabilizes the relationship between the homeowner and contractor, right from the start.

Sonny has graciously allowed me to post this document in full and encourages you to use it yourself, modifying the wording to suit your own business practices. It is a great tool, one that I think belongs in your business systems and practices. (If you are a commercially oriented contractor, you might want to devise something similar if you are dealing with clients who are not sophisticated about construction processes -- or even if they are, that shows you have clearly defined procedures and methods of operation. I think it will help your clients feel confident in your abilities -- and thus free you to a significant degree from commodity pricing struggles.)

Editor's note: Following this posting, Sonny Lykos emailed me regarding the photo caption reference to Overbuilders in Denver: Lykos wrote: "That's my 'The Process'. I sent it to him many months ago, and he did a great job of modifying it to his operation and talents."


Anonymous said...

Mark (and Sonny), great post and neat system. I certainly agree that getting the customer's full buy-in and commitment to the project early on us crucial, but I must point out that "The Process" doesn't apply equally to all trades. In some, like residential repainting for example, you have no choice to offer free estimates because it has become so entrenched in the industry. It doesn't matter how good your process is, you won't stay in business for long charging for painting estimates. Then again, I am only intimately familiar with this one subtrade, and I suspect it might be unique in its dubious distinction...


Construction Marketing Ideas said...

Daniel, I see your point here; of course different industries have different cultures and practices and looking at the JLC thread it looks like the Free Estimate is firmly engrained in the painting trade/sector.

Sonny Lykos said...

Daniel, were I a painting, plumbing, electrical, tile, etc. contractor, I'd still come up with something similar to The Process, although a shorter one, that could be sent prior to the first meeting.

Remember, The Process is not to advise of no free detailed Proposals (not "estimates" which are free), but to advise them, in advance, of your preferred procedures to follow and a little bit about paint. It's sort of Remodeling 101, but can also be Painting 101. In fact, since I also get painting jobs (my favorite trade) if you email me, I'll work with you to create one for you to consider. Remember, it can also be a strong marketing tool.

I'm on vacation all next week and can do it then. While I love our industry, I think my expertise is in selling and marketing, although I also miss the merchandising - setting up displays - I used to do while a retail store manager in Chicago. But alas, that was 35-36 years ago.

Unknown said...

Just ran across this article today 3-22-17..
It's hard to realize Sonny has been gone 9-yrs now.
The awesome learning that took place on so many construction & remodeling websites back in the late 1990's is something that I can only hope to never forget, even though I sold my Maryland plumbing remodeling & retail showrooms business my dad started in the 1950's, well due to health issues, I retired on the day I went to settlement on 7-6-2004.
I've since moved from Maryland to sunny Ocala Florida in 2010... RIP Sonny Lykos.