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Guest Column: What I'm Seeing Out There

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Business

Guest Column: What I'm Seeing Out There

Industry expert and advisor Mark Richardson shares stories from the field, from what's changing to what's working 


By Mark Richardson June 26, 2023
a look at the building and remodeling markets
Image: Alex | AdobeStock

One of the most common questions I get today is “What are you seeing out there?” And while it may seem like an ice breaker as benign as “How’s the weather in your area?”, it isn’t. It’s an important question on the minds of many because winds have shifted, people are noticing and they want some validation that they’re not alone.
As business owners, it’s normal to want to have an understanding of what is out there and ahead of us. We want to know so we can make the right decisions.
With that being—and to answer my own question—I’m seeing a lot. 

Softening at the Macro Level

At a macro level, we’re seeing a “softening” of the market, but in some of the key areas, especially for remodeling, indicators are positive: 


share of owner-occupied housing
Thirty-five percent of homes in the US were built before 1970, according to a National Association of Home Builders report. 
Image: NAHB

Changing Homeowners 

The consumer has changed in the last 12 to 18 months. They’ve become feral (escaped from captivity). A year ago, they were happy to wait in line, empathetic to supply chain issues, willing to accept budget creep. Today travel is your biggest competitor.

The consumer is unpredictable. Many homeowners, according to the stories I’ve heard, “act like they want to remodel” but then cancel or postpone. It can be extremely disruptive. Project timelines can be greatly extended when homeowners revisit and question their decisions. And work-from-home clients, who may be watching over and questioning construction, can make it even tougher to get things accomplished. Controlling this is key.

How Some Residential Contractors Are Succeeding

The better contractors are not just doing fine, many are doing great. There are three differentiators I’ve seen:

  • Market to Find the Right People — Finding the right clients is more important than ever, and this takes more than money. It takes time and energy, as well. The better companies are deputizing the team to wear the marketing hats—which I’ve seen spur creativity, help build a healthy culture, and produce serious results. 
  • A Flexible Sales Process — Adjusting the sales process to respond to the environment is a must—as we’ve discussed in several recent episodes of Remodeling Mastery. Sales training is not just an expense but an investment. The better companies are doing more role plays and introducing more sales tools into the mix.
  • Prioritize Operational Excellence — Mistakes are a kiss of death in this environment. You cannot eliminate them completely, but you can reduce them substantially with diligence. You make your money from what you produce, so make sure you are, one, on time, two, on budget, and three, leave your client delighted. 

I’m aware this is a simple summary of a very involved process. But simplicity can result in real success today.

 

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