And here are some tips on how to do that:
- Builders and home improvement companies- focus on backlogging your leads (watch the video for more details)
- Break down your offerings using 80/20 (Daiana goes into depth on this tip)
- Are you using the 4 quadrants (Rick breaks this down for you)?
Watch/Listen to the full episode below to know more about how to increase your average sale price and profitability.
Try Builder Lead Converter right now and see how we plug your opportunity leaks, capture leads, book appointments and help you increase your average sales price and margins. The only thing you have to lose is sales.
Transcript:
Welcome to Conversations that Convert. Every week we’ll spend about 10 to 15 minutes tackling relevant lead generation, marketing, and sales topics for remodelers, home improvement companies, and home builders. Conversations that Convert is brought to you by Builder Lead Converter, your perfect sales assistant. And now here’s Rick and Daiana.
Daiana: Hi and welcome.
Rick: Hi.
Daiana: Hi, and please let us know you’re here and what business you’re in. And if you have a question or think we’ll try to get it during this episode. And if you’re watching the recording, leave a comment or question. And if we use it in a future episode, we’ll make sure you get the credit. So today’s topic is “Are you ready? How to increase your average sales price and profitability. So let’s see. How are you Rick today?
Rick: I’m doing fine, Daiana. What’s, what’s new with you and your neck of the world?
Daiana: Well here it’s, it’s indeed summer finally. And it’s, we have ama amazing weather and I enjoy that a lot, of that.
Rick: You gotta tell people where you’re at. People probably don’t realize that you’re, you’re in a little different location than probably where they are.
Daiana: I’m in Europe actually and specifically in Romania. So,
Rick: Yeah.
Daiana: Yeah it’s a beautiful,
Rick: Huge
Daiana: Country.
Rick: Beautiful Romania for sure. Yes, I’m anxiously planning my trip to come to Romania and have you show me all the sites and sounds but it, from what I’ve seen in the photos looks quite elegant, quite beautiful.
Daiana: We have amazing landscapes and yeah, you’re more than welcome to visit us.
Rick: And summer would be the time I would go to, I don’t think I want, I get enough of winter with living in where I do in Minnesota. So I’ll definitely take, take summer if I’m gonna visit Romania cuz you guys have cold winters just like us.
Daiana: That’s true.
Rick: Yeah. So we’re gonna talk, you know, a little bit about today increasing your average sales price and profitability. And last week, and we’re gonna, we’re gonna switch back to this a little bit and kind of pick up where we left off. That is we got an excess of leads. You know, I’m struggling, I can’t fulfill all these leads, you know, what do I do with that? Well, one of the things that we wanna talk about is that you know, taking these excessive leads and looking at right now today about building up your, your, your business where you can increase your average sales price and increase your profitability, and then the market will cool off. We all, I mean if you’ve been around long enough, you know, this is not going to last. I’ve seen the worst of the worst of markets, you know, back in 2007 and 2008 and now we’ve probably seen the best market. But the challenge, of course, is making sure that you’re profitable. And there are some real challenges out there as it relates to material shortages as it relates to labor, fixed price contracts as well as price volatility. But you can increase your average sales price and profitability so we’re gonna jump into that today. And one of the things that, you know, the that I, that I think of right away is that, you know, are you making what you’re worth and are you as profitable as you should be? And the answer to this should be no. You, you, you’re, you can always look for ways to make more and be more, more profitable. And I remember a story, you know, when I was first getting into starting my own, my own business back in 2005 and I read the book “The E-Myth” and some of you may have read it, if you haven’t, highly recommended it. But then, really the point of the book is What are you doing to work on your business? So a lot of us work in our business. In other words, we come from, let’s say, a W2 income where we’re punching a clock or we’re on a salary, we’re an employee, and we start our own business. And essentially what we do is we create a job for ourselves, not a business but a job for ourselves. And the e-myth is, you know, stands, e stands for the entrepreneur. And the myth is that you know, we’re gonna build this business to, to, to sail it and have it scalable. And what we find out is that when we get into it, is all of a sudden now we just seem like we’re, it’s we’re a rat and a rat race, right? And so one of our great quotes I heard was, you know, if you win the rat race you’re still a rat. So the idea is, is to get out of the rat race and really focus on building a business where you’re paid what you’re worth and you’re as profitable as you should be. And the idea behind a business is that it can operate without you. And ultimately the end game is, is that you can sell it. So last week we talked about excess leads and that is the starting point to getting to increasing average sales price and profitability. So I hope you’re, looking at these questions and thinking, Yes I can be charging more, I am worth more for my services and I can improve my profitability. So, Daiana, you had a thought here and this is the 80-20 rule.
Daiana: Yes, I’m sure you all know the 80-20 rules, also known as the Pareto principle, and what is that is an average that asserts that 80% of outcomes result from 20% of all inputs for any given event. So in business, a goal of the 80-20 rule is to identify inputs that are potentially the most productive and make them the priority. So here is the question. So, how can you, how can you focus on what’s most important for your business? So the question is where do you pay attention? Where, what is most important for you? From what kind of customers you will get the most profit?
Rick: Good. Good point. You know and as we go back and we look at customers. We talked about having an excess of leads that does gives us, give us the ability to maybe say no to some customers, where in the past we would’ve, we would’ve said yes but you brought up a good point and that is choosing to focus your attention. In other words, we wanna, if we spend 20% of our effort gets 80% of the results what we really wanna focus on is that the 80% of our effort that only is getting us 20% of our results. We want to eliminate that. And you know one of the things that exercise I like to go through with, with, with any of my clients is, is understanding what you do best and what makes the most money. Seth Golden wrote a book years ago called Purple Cow. And it’s really what he talked about specialization. And for those of you that been around a long time, that have this down as you know, that the more you specialize with a certain target market, with a certain geographic market over the certain product offering, the more money you’re gonna make and the more profitable you’re gonna be. I remember years ago I had an issue with my heart and I literally I woke up one night and I thought I was having a heart attack. So I rushed to the emergency room. And so they throw me on the EKG and they’re doing all these tests and they go like, “Well you’re not having a heart attack.” And what they deduce was that I had something called pericarditis, which is an inflammation of the tissue around the heart and it makes you think like you’re having a heart attack. And so it would, it was a virus and it just had to run its course. So every few months it would pop up and it was really painful and it would take weeks sometimes more than a month to get rid of. Well, I kept seeing these general practitioner doctors or emergency room doctors and they kinda said the same thing. “Well it’s got a run course and you know here’s a thousand milligrams of ibuprofen you can take for the pain.” Okay great. But my quality of life was really going down and I finally went and saw a cardiologist a specialist and he said: “Well you know what here’s a study on this and if you take this anti-inflammatory drug for six months, you may end up being cured of that.” And lo and behold I was. Now, who makes more money? A specialist, a cardiologist, or a general practitioner doctor. It’s always the specialist. So what we wanna focus on is like is, is number one is what do you do best and where do you make the most money? So look at the offerings that you have right now and step back and look at your margins and look at number one, what are you good at? What do you enjoy doing? What do you really, you know, excel at? And then number two, match that to profitability. Most likely what you’re gonna find is that what you’re good at and enjoy doing is also the most profitable part of your business. So start there. And then what we wanna do is start to eliminate everything else. Now going back to the E-myth revisited is, you know, we wanna talk about is busyness hinders your ability to prosper. And so I’ve got these three things we’re always talking about. It’s number one, how can I automate some of my tasks? What can I delegate and then what can I eliminate? So, when it comes to delegating and eliminating, there’s something out there called the four quadrants. And I’m gonna throw something up on the screen right now. Some of you may have heard of this. Oh, there we go. Let me move this. Some of you may have heard this but the four quadrants, you know, go, they, they’ve, they fall into the urgent and important not urgent and important. Not important and urgent and not urgent and not important. That first quadrant here is your fires, your crisis, your emergencies, your pressing problems, the things that have to get done, that drive most of your day. That’s where most of us operate. And we wanna move away from that and we wanna move into quadrant two so, this is something we wanna get, get away from moving to quadrant two, which is all about preparation planning, clarifying our values, looking at our relationship building and you know, ultimately having the time to recreate and relax and enjoy some of the successes that we, that our businesses provide for us. Now in order to get outta quadrant one, we have to focus on quadrant two, and then when it gets into quadrants three and four, those are what we want to delegate and eliminate. So, quadrant number three is stuff that is urgent but it’s not important. So those are some things that we need to delegate. And then number four which is not urgent and not important, are things we just wanna eliminate from our day. So going back to that 80-20 rule, if I can focus, you know, break down my day and my offerings for my business into these, into these quadrants and then start to delegate, eliminate and automate some of those things. Now I can actually get to the point where I can focus on building my business up by focusing on that 20% that’s delivering 80% of the results. The idea is if I can continue to manipulate that go from 20% to 30% to 40% to 50%. Now my results come much be, are, much higher. And of course, my average sales price can go up along with my profitability. So one of the tools that we’ve designed that could help you right today is we have something called the lead connector tool and it’s where we eliminate the waste of time of you following up with leads by letting them self-qualify and book appointments for you. We call it plugging an opportunity leak. There are three phases of growing your business and growing profitability and, and, and, and your average sales price. You know, number one is looking at opportunities you have right now that you are missing opportunity leaks and plugging those. And our leak connector tool does just that. And you can try it today. You can go on our website and click on the link right below this and you can play it around with it and see exactly how it works, how we book leads, follow up, excuse me, capture leads, follow up with them and then book them to an, an appointment and then make sure they show up to your appointment. So, hopefully, those are some tips that you can, you can relate to and, and something that you’ve enjoyed. Daiana, anything else you wanna add? You know the, to what we discussed today?
Daiana: Yes, I definitely recommend trying the lead connector tool. It’s amazing and yeah, it’s you’ll, you will discover for yourself if it’s a good fit for you or, or not.
Rick: Yeah the best part is, is not only can you play with it and try it, and if you like, if you like it and wanna try it for your own business, you can try it for 30 days for free just a trial and see what it’ll do for you in, in 30 days. And if it works great, if it doesn’t keep the leads, move on. So Daiana, what are we talking about next week?
Daiana: Next week we’re going to talk about the website and we’ll come up with five killers for, how to capture leads. So five websites lead capture killers. So,
Rick: Yeah it’s amazing that when I talk to a lot of builders and I look at their website because that’s the first place you gotta plug your opportunity leaks is, is your online presence. And it’s the same five things that keep popping up over and over again. And literally, I just wanna say this, do this get these done. But this is huge. This is what we call low-hanging fruit, huge growth opportunities just by getting rid of these lead capture killers. So, until then thank you so much for attending. And again, if you’re watching the recording go ahead and, and leave us a comment down below if there’s another topic or a question that you have, we would love to help you out in the future. And again if you have a great topic and we decide to add it to one of our programs, we’ll make sure we give you the credit. So for my brothers and sisters in Christ, may the grace of the Lord Jesus Christ, the love of God, and the fellowship of the Holy Spirit, be with you all. We’ll see you next time.
Daiana: Take care. Bye
Rick: Bye guys.
