Report Reflects Surge in October Home Improvement Spending

Maybe you are seeing some up-turn in your own remodeling market. I hope so. It seems that remodeling is on the rise again, thanks in part to the energy tax credit. Check out this great article from Professional Remodeler magazine.


Report Reflects Surge in October Home Improvement Spending - 12/2/2009 1:44:00 PM - Professional Remodeler:

"Government reports are showing that spending on home improvement surged 8.7 percent in October as American homeowners respond to tax credits.

Data from the U.S. Commerce Department’s monthly construction spending index showed spending on home improvements at a seasonally adjusted annual rate of $114 billion in October – a jump of 8.7 percent from $104.9 billion in September."

Chinese Drywall Update - U.S. Consumer Product Safety Commission Chinese Drywall Report - Popular Mechanics

Hoo boy. Here's an update from the Consumer Product Safety Commission on the Chinese drywall problem in the U.S. There is still no remediation strategy, compensation plan or consensus as to the exact chemical that is causing the problem. Read on. From Popular Mechanics Magazine:

Chinese Drywall Update - U.S. Consumer Product Safety Commission Chinese Drywall Report - Popular Mechanics:

"6 Surprising Findings from the Chinese Drywall Report The Chinese drywall scandal is now nearly a year old. And while incidents of Chinese drywall being installed in homes have all but stopped, complaints of bloody noses, sinus infections and vomiting spells for pets and people, widespread corrosion and blackening of copper tubing and wiring and 'rotten egg' smell continue to roll in. Last spring, the U.S. Consumer Product Safety Commission conducted 44 investigations into consumer complaints about drywall. Few of the complainants provided evidence that their drywall came from China, but the report included no shortage of devastating medical reports, panicked letters written to government officials and photographs of corroded metal. Here are six surprising findings from the report:"

Click here for more.

Home Buyer Credits Extended and Expanded

On November 6, 2009, President Obama signed the Worker, Homeownership, and Business Assistance Act of 2009. Among other things, the Act extends the $8,000 first time home buyer credit for homes purchased or under contract by April 30, 2010. In addition, a new smaller credit of $6,500 will now apply to families that have lived in their homes for at least five years and purchase another home between November 6, 2009 and April 30, 2010. Of course, there are restrictions and limitations on both credits. Check out NAHB’s new website Home Buyer Tax Credits for an excellent summary of both credits.

It is the President’s intention that expanding the Home Buyer Tax Credits will help to continue the sale of homes which will, in turn, reduce the inventory of unsold homes and help home prices continue to increase across the country. The White House points out that residential housing investment grew 23 percent in the third quarter, one of the contributors to positive economic growth.

Owens Corning Launches Shingle Recycling Program

Owens Corning Launches Shingle Recycling Program: "Owens Corning Launches Shingle Recycling Program
Manufacturer to simplify shingle recycling for contractors


TOLEDO, Ohio -- Nov. 3, 2009 -- Owens Corning announced through its roofing business that it will provide a new program that simplifies recycling asphalt shingles for its Preferred Roofing Contractors. The company is the first roofing manufacturer to connect contractors with convenient recycling facilities through a national strategic alliance."

Read more here.

How to deal with your client's increasing stress levels

A new survey reveals that homeowners are becoming more stressed as the result of their remodeling projects. Read on to learn how tension surfaces in a family situation and what you, the contractor, can do about it.

Survey Shows Remodeling is Stressful: "Survey Shows Remodeling is Stressful
Routines disrupted and relationships put on edge

A recent survey shows that remodeling often increases tension between family members.
ServiceMagic.com

GOLDEN, Colo. -- October 29, 2009 -- A national survey released by ServiceMagic.com indicates a rising trend in boosted tension and heightened stress levels within the family during a home remodel within the last year. In a time when remodeling is on the rise, up 13.5% from Q3 2008, ServiceMagic.com experts looked at the current trends and found surprising results from an exclusive homeowner survey."

For the rest of the article, click here.

So how do you deal with stress from a remodeling project to ensure that you are not on the receiving end of the client's frustrations? As the article stated, there are three main sources of frustration within the family:

1. Projects took too long.
2. Contractors were messy.
3. Projects went over budget.

You can easily deal with these three sources of frustration by managing the client's expectations and a little jobsite clean-up.

First, plan the job accurately and completely. Account for all phases of a job and put it down on paper. Make sure that your production team buys in on the schedule. Then, share that schedule with your client. Be sure to explain the schedule to your client, including events that could change the schedule (such as change orders). This is just as important for small jobs as it is for large ones. Never undertake a job without a written plan!

Second, clean up every day! Your production crews should put away their tools, neatly contain materials and broom sweep on a daily basis. If you are working inside the home, use plastic to contain dust and carpet/floor protection to keep flooring clean. Explain to the customer up front that any remodel will create dust but you will keep it to a minimum. And then do it! You may even consider paying for a cleaning service at the end of a job.

Third, present clients with change orders immediately if they wish to change the scope of the project. Detail the change, the cost and the impact on the schedule. If the client decides to accept the change order, make sure it is signed immediately.

The three main sources of stress for any family undertaking a remodeling project can easily be managed by you and your staff.

Moisture Management Solutions

Moisture problems can be a big issue for your clients. Want to learn more about how to deal with those moisture problems? Georgia-Pacific has created a new educational series on just that topic. And it's free. Just register, click and learn.

Moisture Management Solutions - LoginAndLearn.com: "Moisture Management Solutions CampusWelcome to the Georgia-Pacific Gypsum Moisture Management Solutions Campus. It is part of LogInAndLearn.com and is intended to be the single platform you should regularly visit for Moisture Management Solutions education, resources and associated links."

For more, click here.

Remodeling Magazine's 2010 Big 50

An award can boost your company's name and reputation in your community as well as give you a well-deserved pat on the back for a job well done. Remodeling's Big 50 is one of the most influential. Check it out and, yes, you can nominate yourself.

Think You're a Contender for the 2010 Big50? - Remodeling Magazine: "Think You're a Contender for the 2010 Big50?
What is the REMODELING Big50?"

Read more here.

Just 2% Can Make a Difference

What could just 2% more effort do for you and your company? Read on to find out . . .

Boost Referrals by Making a 2% Difference - Sales - Remodeling Magazine: "Boost Referrals by Making a 2% Difference
Sales expert Lorna Riley offers tips on building referrals"

Read more here.

Remodelers Tighten Up Labor Costs to Stay Afloat

Don't kid yourself, these won't be popular ideas to implement and they won't be easy, but sometimes we have to make tough decisions.

Remodelers Tighten Up Labor Costs to Stay Afloat - 10/1/2009 - Professional Remodeler: "Remodelers Tighten Up Labor Costs to Stay Afloat
Faced with a shortfall of new business, remodelers have been obliged to make cuts in staff, pay and benefits and bring work in house that used to be outsourced."

Read more here.

House Passes Homebuyer Tax Credit Extension

The extension of the $8,000 first time homebuyer tax credit moved another step closer today with the passage of the House bill. Included in that bill is a $6,500 credit for existing homeowners who have lived in their home the past 5 out of 8 years to purchase a new home. Next up is President Obama's signature.

Congress Passes Homebuyer Tax Credit - UPI.com: "Congress Passes Homebuyer Tax Credit
Published: Nov. 5, 2009
By Steve Cook Real Estate Economy Watch
After the Senate gave final approval last night without a dissenting vote, the House of Representatives voted overwhelmingly this afternoon to pass legislation containing an extension and expansion of the homebuyer tax credit, completing Congressional action and sending the tax credit to President Obama for his signature, possibly as early as tomorrow."

Read more here.

Learn from the best

Iris Harrell is an innovative and successful remodeling company entrepreneur. Read on to learn more about her and her successful company . . .

Iris Harrell: The 2009 Fred Case Remodeling Entrepreneur of the Year - Awards, Company Culture, Green Remodeling - Remodeling Magazine: "Fully Vested
Don’t try telling Iris Harrell that women can’t rock at remodeling — or that companies can’t continually evolve and grow stronger."

Read more here.

Senate extends $8,000 homebuyer tax credit

This is great news for the new construction industry and new home sales.

"Tax break for buying a home: The legislation also would extend the $8,000 homebuyer tax credit to contracts signed by April 30 and closed by June 30. The controversial credit, which many say has boosted home sales in recent months, was set to expire after Nov. 30."

Read more here.

It's a Mixed Bag of Tricks

It’s a mixed bag of tricks as far as the economy goes. I reported earlier that GDP grew by 3.5% this past quarter, causing CNN to declare the economy back in gear.

Qualified Remodeler reports today in its Weekly Remodeling Market Overview that new home sales fell in September most likely due to the upcoming expiration of the $8000 first time homebuyer credit. That ends 5 consecutive months of increases in new home sales.

On the other hand, existing home sales are running at a brisk pace, again most likely because of the homebuyer tax credit. The credit expires on November 30, 2009. Buyers must have closed on the home by that date. It makes sense. Unless it’s a spec home, a new home would not be ready in time to take advantage of the expiring credit. And we all know there are not many spec homes around.

There has been some talk of extending the tax credit for one year. Another idea is to expand the credit to include all home buyers.

Home sales fueled the prior economic expansion and, in many ways, directly contributed to the current recession. Does it make sense that housing needs to recover first before the entire country can recover? That’s an interesting question to ponder.

Economy finally back in gear . . . according to CNN

Great news today! According to CNN, "Government says GDP grew 3.5% in third quarter, ending a year-long string of declines and coming in better than forecasts."

Read the entire article here.

I know that we are seeing more activity in our own local remodeling business. Sales are up in both September and October. More calls coming through. And people are thinking about doing more than just repairs.

For those who have continued to market through the downturn, you are in the right place at the right time. For those who haven't, you've got alot of catching up to do.

Regards,
Annette

UCLA Anderson Forecast Says The Recession Is OVER!

The end of a recession is the best time to start or grow a business. Are you ready? According to the UCLA Anderson Forecast, a leading economic forecaster, the recession is over. Don't miss this boat!

The UCLA Anderson Forecast: "In a report titled, “The Long Goodbye,” UCLA Anderson Forecast Senior Economist David Shulman states, “ … after four quarters of decline, economic growth is resuming. We forecast that real GDP will increase at 2.1% in the current quarter and 2.3% in the fourth quarter. For all of 2010, we forecast quarterly growth to average 2% with noticeable improvement at the end of the year.”"

Check out the full article on the UCLA Anderson Forecast website.

The positive and the negative

According to Hanley Wood’s Key Indicator Alert from last week, the economy is still improving slightly. The stock market has been heading in the right direction; mortgage rates are declining; new and existing home sales are increasing. The main drags on the economy now are jobs and lending.

Employers are still shedding jobs but at a slower pace than previously. That makes sense as businesses are trying to maximize their smaller profits or, in some cases, minimize their losses.

Lending is still a big problem for our industry. Most homeowners don’t have the financial wherewithal to pay for large remodeling projects out of pocket. Therefore, larger projects are put on hold. There is still activity, however, at the maintenance level.

Oh, and a big plus was the surprisingly large increase in the August Consumer Sentiment. Are we ready to move forward? I’m thinking consumers are not happy with the prospect of another bleak holiday season.

Are you using the Energy Efficiency Tax Credits to your advantage?

By now you’ve probably heard about the Energy Efficiency Tax Credits. Those are the credits that consumers can take for buying and installing energy efficient products in their homes. The products include replacement windows and doors, insulation, roofing, HVAC, water heaters and bio-mass stoves. (In addition, there are some geothermal and solar products that qualify for credits, too, but we will limit the discussion to retro-fit products).

If your remodeling or home improvement company specializes in any of these types of products, you are missing a big boat if you are not offering products that qualify for the credits. Just about all manufacturers in every one of these product lines are now offering products that qualify.

To learn more about the tax credits and what products will qualify, check out the government’s Energy Star website.

Remodeling magazine has a great section about the entire stimulus package. Check it out at http://www.remodeling.hw.net/green/stimulus-tax-credits/ for a comprehensive guide about the credits.

And you can check out our remodeling company’s blog, Manassas Remodeling Contractor, to see how we have been promoting the credits to our own customers.

But don’t wait for your customers to ask you about the tax credits. Bring it up in your sales presentation. I am still amazed by the number of consumers who are not aware of the credits or don’t know what products qualify.

Regards,
Annette

Networking Can Work

I found a great article for you on networking in Replacement Contractor Online. It touches on business networking, such as BNI and your local Chamber of Commerce, and how to do it.

The article also goes into networking with your current and past customers as well as your suppliers, contractors and others. There are some great examples of companies using these techniques.

In our own remodeling business, we network on a regular basis with our past customers as well as homeowners around a jobsite. We find this to be a great source of leads. I've also networked in the past with a local leads group as well as our Chamber of Commerce. Again, excellent lead sources if done correctly. A waste of time, if not.

Check out the article at: http://www.replacementcontractoronline.com/industry-news.asp?sectionID=316&articleID=1061829&artnum=1



Enjoy,

Annette

Put Time On Your Side

Do you have some potential clients who are on the fence about proceeding with a remodeling project? Are you looking for ways to create some urgency to get people to commit now rather than later?

Use time. Time (or the lack thereof) can be a powerful motivator to get your clients to commit now.

By explaining the amount of time each step in the remodeling process can take, your potential clients can see the need to move forward if they want to complete a project by a specific date. To make your presentation even more powerful, use a calendar or timeline and work backward from their date.

Finally, Some Good News for Remodelers

There’s a lot of positive news in Qualified Remodeler’s September 4th Weekly Market Overview. First, according to data from ServiceMagic.com, remodeling (versus repair and maintenance) requests are on the rise, especially among those in homes valued between $200,000 and $300,000. And, equally interesting, is that baby boomers (those in the 45 to 64 age group) are the ones making those requests. Interest is rising in kitchen and bath remodeling. And consumers are intent on increasing the entertainment value of their homes with the purpose of staying home more. (Remember our discussion of cocooning several months ago?)

And the biggie: According to Qualified Remodeler, “Homeowners plan to tackle small projects, keeping with the Q1 trend, with the intent to head into large-scale remodels in early 2010.”

Be cautiously optimistic, fellow remodeling professionals. Plan ahead and be ready. There is still a major issue in remodeling. That is how homeowners plan to finance their improvements. With home values down, the spigot has been turned off on their home equity lines.

Personally, we are already seeing more calls in our own remodeling business. Projects are still smaller but more and more, people are thinking about larger projects.

6 Myths About Green Consumers

I recently ran across this article entitled, 6 Myths of Green Consumers. It states:

"A new national study of green consumers contradicts several long-held stereotypes about them: The environment is not their top concern, their kids are not influencing them to be green, and while many know what they should do to save the planet, they often don’t do it."

It's based on a study of consumers who, at least occasionally, buy green products. It's an interesting article and I thought you might like to read it.

http://www.ecohomemagazine.com/news/2009/08/6-myths-of-green-consumers.aspx

Cell Phone Recycling

While preparing my remodeling office for a move, I stumbled upon our stash of used, out-of-date cell phones. We kept these phones over the years so that we could use parts in our new models. How many times did that happen over the past 20 years of cell phone use? About 2! How many cell phones had we accumulated? 27!!!

Purely by coincidence, I stumbled upon a great use for these phones that benefits our troops overseas. The program is called Cell Phones for Soldiers. Since 2004, teens Brittany & Robbie Bergquist and Cell Phones for Soldiers have raised millions of dollars to help our troops call home. Donated cell phones are recycled and the proceeds are used to purchase prepaid calling cards for American troops.

I hope those 27 phones provide some great talk time for our military families.

Looking for Financing for your Remodeling Business?

I ran across this article today on Remodeling on-line and it gives alot of information about where to go for SBA loans. Check it out:

http://www.remodeling.hw.net/green-policy/lifelines-of-credit.aspx#

Twitter Through The Remodeling Show

Can't make it to The Remodeling Show but still want to stay up-to-date? Follow The Remodeling Show on twitter.

http://twitter.com/remodeling_show

Twitter updates begin September 9th. The Remodeling Show starts October 27, 2009 at the Indiana Convention Center in Indianapolis, Indiana.

You can follow me on twitter, too, at:

@annettergreco

Regards,
Annette

Ch - Ch - Changes!

Changes are abounding for me personally and in our remodeling company this month! In August, we consolidated our office space for our remodeling business and that meant my office had to move. It was a long process. I can't believe just how much stuff accumulates over the course of 24 years! But it also meant a thorough cleaning and re-organization. It's amazing how refreshed that can make one feel!

The second change was taking our daughter to college. That's an even bigger one because she's an only child. The house seems quiet but I'm keeping myself busy with lots of projects.

Look for more changes in On The Level Consulting in September. We are adding more items to make running your company easier. And a new service to help you improve your company's Google local search ranking.

Regards,
Annette

Award Competitions Are a Great Marketing Tool

A great marketing tool for any remodeling or home improvement company is to enter award competitions. Depending on the type of competition, awards can showcase the beautiful work of your company or the organized and professional nature of your business. Winning an award or many times just being nominated for an award increases the company’s brand in the marketplace and provides a third party endorsement of the company.

An award or the nomination of an award can boost your company’s credibility with customers and potential customers. Homeowners love to do business with an “award winning company.”

An award or nomination can get publicity for your business. Send out a press release about the award and you could find yourself in your local newspaper with free publicity. And once the media is aware of you and your company, they may contact you again for input on additional stories.

I’ve compiled a list of upcoming awards in the remodeling and home improvement industry. And if you’d like to learn more about awards, check out my article 4 Reasons Award Competitions Should Be Part of Your Marketing Strategy.

To Your Success,
Annette

HIRE Act of 2009 Would Help the Remodeling Industry

More help for the remodeling industry could be on the way in the form of a tax credit that would stimulate the purchase of kitchen cabinets and other remodeling and home furnishing improvements.

Congressmen Henry Johnson (D-GA) and Nathan Deal (R-GA) have sponsored the legislation called the Home Improvement Revitalize the Economy (HIRE) Act of 2009. The Act would give individual consumers and joint filers respectively a $2,000 or $4,000 tax credit for purchasing items that meet recognized environmental standards (LEED, NAHB, Green Globes, SFI/FSC and ESP). Retailers, contractors and building product resellers can receive up to $10,000 for covered purchases.

“Not only would this help stimulate the manufacturing market for home furnishings and buildings products, it would save retail jobs, generate billions in revenue and increase home values at the time when we really need a boost,” according to Johnson. “By creating this tax deduction, we will offer incentives for consumers who would otherwise forego spending in 2009 and 2010. We will encourage environmentally sound practices by doubling the benefits for the purchase of building products and home furnishings that meet nationally recognized environmental standards.”

Check out the recent article in Professional Remodeling online or the KCMA website to learn more.

What can you do to support this bill? Contact your representative and ask that he or she co-sponsor the bill.

Choose the right words

Why are some people “glass half empty” and some people “glass half full” kind of folks? Why do some see only the negative in a situation while others see opportunity?

The fact is we choose the words we use to describe our situation. So if we describe a situation as a problem or a disaster that is exactly what it is.

Describe a situation as an opportunity and that is what it is.

The language we use reflects a certain reality but it also deflects a competing reality. So the person who chooses negative words to see a situation as a disaster is unable to see it any other way. There are no opportunities in that situation.

And vice versa.

Start looking at your situation as an opportunity. It may not be the best situation you could want but look for the positives. Maybe you've cut your spending to bare bones and found yourself more appreciative of what you have. Or you've been able to devise some new low cost marketing strategies to reach your target market. Take action to move yourself toward those new opportunities.

This Week’s Key Indicator Report

This week’s Key Indicator Alert from Hanley Wood Market Intelligence is not a particularly positive report. Other than mentions of the slightly positive housing news from the last report, there is also mention of the higher unemployment rate (which I’m sure you have all heard about on the news). The positive spin is that we are losing fewer jobs. But the unemployment rate is still the highest it’s been since 1983. When I graduated from college in 1981, I remember looking in the Washington Post for a job in my field and finding one listing! What did I do? Stayed in the job I had during college until the recession was over.

The other news is that national average mortgage interest rates have declined this week. That may get more people into the housing market as fear of missing out on low rates could take hold. When rates were rising over the last couple of weeks, there were fewer refinance applications and fewer home purchases.

Be award that earnings season starts soon and the markets could show some volatility in the upcoming weeks.

Here's what you can do: Stay positive. And take positive action. I know it’s hard with all of the negativity surrounding us day in and day out. Take the time now to build your business skills. And keep moving forward.

Social Bookmarking Made Easy

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If you've ever signed up for Technorati, a social bookmarking site, you'll know what these numbers are all about. If you haven't and you're interested, these numbers are the code Technorati uses to verify that I'm claiming my own blog. If you couldn't care less, no problem.

You'll notice that I've place a widget at the end of each post. It will allow readers to print or e-mail a post and to submit the post to any favorite social bookmarking site. Hope it comes in handy.

To Your Success,
Annette
On The Level Consulting

Positive economic news continues for remodeling industry

In the latest Key Indicator Alert from Hanley Wood Market Intelligence, the slightly positive economic news continues for the remodeling and home improvement industries.

Both new and existing home prices continue to rise slightly. Existing home sales rose but new home sales fell slightly. Mortgage rates are continuing to creep up, too. Those factors are making possible buyers re-think their wait and see strategies. It may be time to jump into the market.

And inventories of both new and existing homes are continuing to go down. That means we are working through the foreclosed homes (although slowly) and there are less homes available.

So what happens when there is less supply and more demand? Prices go up. Everyone wants what they can’t have. And the housing industry heats up again.


Check out more business advice for your remodeling or construction business.

Here’s a no cost way to get work for your remodeling business

Today, I had an appointment for a bathroom estimate in the next town over from my remodeling company’s office. It’s about 15 minutes away, tops.

A past customer lives right around the corner from my appointment. This past customer had called in last week with a concern about a water leak. They thought they had a crack in their foundation. Now we don’t do any type of foundation work but, since they are a great customer and I was in the area, I thought I’d stop by and give it a look. Maybe I could pinpoint the leak for them and refer them to a contractor who could help them.

Turns out, the water is leaking from a broken washing machine hose. We scheduled some handyman work and we’ll take care of it for them right away.

If I had not taken the time to stop and help them out, I would have missed out on some additional work. I know changing a washing machine hose is not a big deal. But once we are in there, many times customers find more projects for us to do.

Giving your past customers some personal attention can bring additional work to your doorstep. Just a quick stop when you’re in the area and a hello can get your past customers thinking about more remodeling work and keep you and your remodeling business at the top of their mind.

Continuing the Positive Economic News

The Hanley Wood Market Intelligence Key Indicator Alert is out for the week. It’s more positive news, although slightly so. At least it’s not negative. The stock market did pull back some from its run. But that’s to be expected with investors wanting to take their profits when they can.

You may have heard in the news that housing starts jumped in May by 17%. That’s true but . . . it’s mostly multi-family housing. Single family housing rose only by 3%.

Housing continues to move ever-so-slightly up. New home starts are up and inventories are low – about 10 months. That’s the lowest the new homes inventory has been since over a year ago. And the median new home prices continue to rise ever so slightly. Of course, they are still down drastically from where they were just a year ago.

Existing home sales also rose but are down from where they were one year ago. And more slightly good news is that the median existing home prices are inching upward.

Mortgage rates continue to rise and fall. Last week they fell again.

So the good news is that things are moving in the right direction, although very slowly. That’s probably for the best right now. We don’t need any huge spikes and we certainly don’t need the economy to go into over-drive overnight. Slow and steady.

If you’d like to learn how to discover trends in your own market, check out my article How to Become Your Own Economist – Reliably Predict Your Construction or Remodeling Market.

Do You Know Who Your Buyers Are?

Demographics are the characteristics of populations. You’ve probably heard that word thrown around a lot. Maybe your yellow pages rep came in and asked you what the demographics are for your remodeling or construction company’s market. Or you might have read an article that talked about your market’s demographics.

The truth is it’s an extremely important statistic for you to know. And if you don’t know who your customers are, chances are you are wasting an awful lot of time and money trying to get customers for your remodeling or construction business.

Because once you know who is most likely to buy your remodeling or construction services, the easier it is for you to find them.

Now your demographics are not the same as ABC Construction down the street or XYZ Remodelers up the block. Every business is different.

Find the demographics for the jobs that are in your sweet spot. The ones that are produced on time, on budget and with the least amount of problems. The ones where your company makes the highest gross profit.

So what do you need to know? Here are some items to get you started:

Where do they live?
Are they male or female?
Are they married, single, divorced?
What is their economic status?
What problem are they trying to solve?
Or what pleasure are they trying to gain?

Add to your list.

To Your Success,
Annette

Saving Money is a Beautiful Thing!

I stopped in my local Verizon store yesterday to upgrade a phone on our remodeling company’s account.

That trip will save me over $2000 this coming year!

When I walked in, I was intent only on purchasing the new phone (as cheaply as possible) and getting out of there (as quickly as possible). The salesperson, Michelle, told me that she wanted to check our current plan first. When she returned, she said she could save us some money. Yeah, right, I thought.

But Michelle and I started crunching the numbers and the new plan should save us about $180 a month. That is substantial!

Lesson for today: Periodically (maybe every 6 months to 1 year), contact all vendors with whom I have monthly contracts to ask if there are any new plans that would work better for my business.

It was a sad day at our remodeling company’s office

Today our administrative assistant’s father passed away unexpectedly. Our hearts ache for the family as they deal with their grief.

I thought about our small group and how we have come together in the past to help each other deal with grief and pain. And we’ve been there to help with the celebrations, too.

I’d never really thought about it too much before, but our group has been through much together. We’ve cried together at 4 funerals, celebrated together at 2 weddings, rejoiced over 3 grandbabies, and commemorated 3 of our children as they graduated high school. I’m happy that we’ve had no divorces.

Today we again vow to help our friend bear her pain. We’ll fill in for her while she is away. We’ll comfort her when she returns. And, hopefully, we’ll help her ease into a new normal. Because that’s what friends do.

More positive economic news trickling in

The Hanley Wood Market Intelligence Key Indicator Alert is out for this week. And there is more positive news about the economy.

First both new and existing home sales are up slightly, making the third straight month of increases for both indicators, while median home prices for both new and existing homes have increased, too. These indicators could be pointing toward a stabilization in the housing markets, one of the key requirements for a true economic recovery to take place.

In addition, consumer confidence soared in May to its highest level since last September. Also significant is that this is the third straight month that the consumer confidence index has increased.

Personal incomes have increased slightly for the first time since last September. But consumer spending is down. So what are people doing with their money? Paying down debt and putting it into savings. Could this be an indication that consumers will be ready to buy once they know that the economy is out of recession?

If you have been watching the stock markets, you’ll notice a steady rise. Regular market increases and pull-backs have been the norm lately. And more money is moving back into those equity markets.

This all sounds like great news, doesn’t it? Don’t get excited too quickly, though. We’ve still got a huge albatross. It’s called the auto industry. With both GM and Chrysler in bankruptcy, look for effects on employment and consumer spending in the near future.

And then there is . . . inflation. But we won’t go there yet.

If you’d like to learn more about your own market (a micro-economy) by following three economic indicators each month, check out my article How To Become Your Own Economist: Reliably Predict Your Market With Just 3 Easy-to-Find Economic Indicators.

June Is National Safety Month

For those of us in the remodeling and construction industries, June is a great month to re-commit ourselves to the safety of our workers. Requiring safe practices on the job is not only good business, it’s the right thing to do for our workers and their families.

A safety program is the first step to ensuring that your company is a safe place to work. Your insurance agent or insurance underwriter can help you with a safety program. Or check on-line for a ready-made program.

Training is the next step. Make sure that your employees know the safety rules and why those rules are important. Enforcement is probably the hardest step. Owners, managers and fellow workers must be able to speak up when they see unsafe behavior. After all, one accident can affect the entire company in many ways.

Take the time this month to put a safety plan in place or dust off the one you already have. Safety at work is a top priority in our industry.

A body in motion stays in motion

The universal law of physics applies to both the body and mind. Once an activity is started, it’s easier to maintain momentum.

So how do you get started on a project or activity? Especially one you’ve been putting off?

Start by creating an action plan. Break the project down into smaller tasks. But the real secret is to include easy, less demanding tasks at the start of the project to make it easier to begin. Once the project is started, the tasks become more demanding. By that time, momentum has begun and the law of physics kicks in.

Need to start a project and just haven’t yet been able? Strive to be the body in motion. Start with small tasks and take advantage of the momentum you create.

An ever-so-slight uptick in the economy

Hanley Wood Market Intelligence’s Key Indicator Alert is out for the week and there is definitely some interesting data to be explored.

GDP decreased again for another quarter but at a rate less than last quarter. Businesses have slowed production so that they won’t be inundated with unwanted and unsaleable inventory. That makes perfect sense.

But personal consumption has actually risen slightly in the first quarter. Could we possibly be seeing the beginning of increasing demand? If so, economic growth may not be far behind.

New home prices are at their lowest point since December of 2003 and interest rates are the lowest in 39 years. What’s needed now is consumer confidence to ignite home buying. Of note is that existing home prices have risen slightly for the second month in a row while inventories of existing homes continue to work themselves down.

Unemployment, although still high, also increased by less than the previous week.

And the big news – the consumer confidence index is up.

All of this data may be telling us that the downslide is slowing and the bottom is near. Don’t get too excited yet, though. We’ve got a long way to go.

Continuity Plans – Not Just for the Swine Flu Outbreak

It’s a great idea to plan ahead in your business so that natural disasters, illness, injuries and family emergencies cause the least disruption possible. That’s the idea behind a Continuity Plan – your business can continue in some way if a future event occurs that would disrupt normal business practices.

Probably the most important thing you can do for yourself and your employees, customers and family in the case of a disaster is to remain calm. Having a contingency plan in place will help you to feel confident should anything untoward happen.

Here are some tips to help you with your own Continuity Plan:

1. Involve other employees in the planning process to ensure a thorough, workable plan. Make sure everyone in your organization knows the plan.
2. Develop an up-dated list of contact information for customers, vendors, subcontractors, and employees that you keep with you at all times.
3. Check to be certain you will have access to any warehouse or office space if you are not the primary occupant or if you sub-lease.
4. If you plan to work from home, test your systems now to be sure your remote access connections work.
5. If you have employees and you plan to allow them to work from home, test their remote access systems, too. Also check their internet access to make sure it is adequate.
6. Make note of all user names and passwords required for programs and web access. Make sure that employees who could be working from home have done the same.
7. Determine which functions are critical for your business and which can be put on the back burner in case your staff is reduced.
8. Cross train your employees so that all necessary jobs can be covered.
9. Test or activate on-line banking.
10. Make arrangements for additional labor if your own labor is unavailable.
11. Make arrangements for your own job functions and those of all key employees should you be unable to work.
    
    

How to verify an e-mail address

It’s easy to verify snail mail addresses and phone numbers through reverse directories or phone books. But what if you have a contact list full of old e-mail addresses? Maybe you’ve sent an e-mail and haven't yet received a reply.

You can check to make sure the e-mail address is still valid. (Whether or not the recipient will open the e-mail is another story entirely!)

Go to verify-email.org and enter the address. The system will tell you if the e-mail address still exists.

Believe

When no one else believes in you, believe in yourself and watch the magic happen!
Enjoy.


http://www.youtube.com/watch?v=9lp0IWv8QZY

Professional Remodeler’s Business Results Survey Is Out

If you haven’t seen it yet, you should check out Professional Remodeler Magazine’s 2009 Business Results Survey. You can find it on-line at http://www.housingzone.com/proremodeler/article/CA6649117.html?nid=2470&rid=10200878.

There is nothing really surprising to all of us who have been living through this economic downturn. Company revenues are down. Average job sizes are down. Number of jobs are up. Labor cost is up. Repeat and referral leads are up.

But it’s worth taking a look at the survey results and really studying the figures as well as the commentary. If you do, you will find out what projects are the most popular, which marketing techniques bring in the most leads, and the average owners’ compensation among the group. You can check your company’s numbers against the survey results to see where you stand.

Check out the article, Examining the remodeling market crash.

Source: Professional Remodeler

Inevitability Thinking

In yesterday’s post, I stated that “We live our lives differently when we know the outcome.”

You might ask, though, how do we know the outcome?

By utilizing inevitability thinking.

If it is inevitable (in our own minds) that we succeed, we will create all of the conditions necessary for that success to be inevitable. It’s a paradox but one with a positive outcome.

Be careful, though. Inevitability thinking can have negative outcomes, too, as it already does for so many. We think it is inevitable that we fail, that we don’t make the sale, that we struggle in our business.

It doesn’t have to be like that. Find it inevitable that you succeed and you will know the outcome.

We live our lives differently when we know the outcome

Ever watch a sporting event on tape when you already know the outcome? Chances are, if you already know your team or player had won, you tend to treat their set-backs in a different way. “It’s ok, better shot next time,” you might say. Or “You’ll turn this around.” And, sure enough, your team or player does. Most likely, you didn’t get upset or mad. You didn’t yell at the tv or berate the player. You remained pretty calm and you were able to enjoy the game.

Now imagine you are able to do that with your own life. You already know the outcome. You know that the steps you take toward that outcome will, in most cases, move you closer. But, occasionally, there will be a misstep and you’ll find yourself having to make an adjustment or re-group in a different direction. But it’s ok because you know that, in the end, you will reach your goal.

Wouldn’t you feel better when life throws you a curve ball? You wouldn’t waste time getting angry or sad or depressed. You wouldn’t waste your energy complaining or wishing for something different. You’d just move on. “It’s ok, I’ll do that better next time,” you might tell yourself.

Truth is we do know the outcome.

As Napoleon Hill said, “There is one quality that one must possess to win, and that is definiteness of purpose, the knowledge of what one wants, and a burning desire to possess it.”

With that definiteness of purpose and that burning desire, we know the outcome. We will succeed.

That’s a life-altering change in our thought process.

How would you live your life if you already knew the outcome?

To Your Success,
Annette

P.S. “Where’s John?” some of you want to know. John has been busy selling. But I promise you he will be back this week with a great post. Check it out!

Another remodeling boom on the horizon?

Although we are in the midst of an economic crisis, the U.S. population continues to increase. Annual household growth is expected to rise by an average of more than 1.5 million for the 2009 to 2012 period.

But builders aren’t building new homes. Although housing prices as well as interest rates are at record lows, the demand just isn’t there right now. And it’s tough for developers and builders to find financing for their projects or their buyers.

So what’s going to happen once things turn around? And it will. It’s just a matter of time. All those people and no new homes to buy? Remodeling. Be ready.

Remodeling is a local market

You may be hearing about the horrible housing markets in Florida, Arizona and California. After all, it’s all the media focuses on. Those states are among the hardest hit in the housing melt-down. They also had some of the highest property values, too. Values were rising faster than new housing could be built. In hindsight, it was a recipe for disaster.

But what if you live in a different area of the country? What if you are in, say, Austin Texas, or Portland, Oregon? In those areas, housing was not hit as hard. The economies are, well, we can’t use the word “strong” any longer. Maybe “firm” would be a better characterization.

The point is that remodeling, like homebuilding, is a local economy. The media loves to make sweeping statements that make us believe it is the same all over the country. But it’s not. Even areas within hard-hit places like California, Arizona and Florida are doing better than others.

Focus on your own local market and don’t buy into the rest of it.

Help your remodeling customers feel good about their decisions

There’s a great question and answer on the HGTV Pro.com site that I want to share with you today. It characterizes how our remodeling customers and potential customers are feeling right now. They are afraid, scared, frightened. This state of fear makes it difficult for them to make a decision. So they continue to sit on the sidelines waiting. They’re not sure what they are waiting for. But they are waiting.

We need to convince our potential customers that they are making the right decision. We can do that through our marketing and sales processes. Help your customers feel good about the remodeling decisions they are making and you will see more projects come your way.

To Your Success,
Annette


Ed Del Grande: Ask Ed
April 6, 2009
Recession Remodeling: Money Down the Drain?

Q: Hi, Ed. My husband and I are loyal readers of your column, and we both decided we would follow your advice on the following matter. For the past several years we have been saving up to remodel our bathroom, and the highlight of the job will be installing a big, beautiful whirlpool tub. Now that we actually have the money to do the project, we are hesitant to start the job because of the slow economy. Is this a good time to remodel the bathroom, or should we wait? -Tina, Nebraska

A: Tina, you're not alone, and it seems with all the bad economic news being reported by just about every major media outlet, we've become a bunch of deer stuck in the headlights. I believe that if we all take a break from the doom and gloom and start living our lives again, we may actually get things moving!

Day after day, the news tells about the bad loans and how houses are losing money. However, what you don't hear is that now may be the best time in years to invest in your home if you have a little cash or equity built up.

For the first time in a long time, good contractors are readily available and are aggressively working with homeowners to keep labor costs down. Materials are also coming down in price, especially for larger luxury items. Also, investing in your present home with a big remodeling job or addition can give you the dream house you always wanted without the hassle of moving. So, if you like your neighborhood, have the room to expand, and have some cash on hand, I say go for the whirlpool tub!

I recently spoke to a friend of mine who is completing a gourmet kitchen addition to his present home, and he told me the toughest part was getting over the uncertainty of going forward with the project in an unstable market. Now that it's nearly complete, he and his wife are thrilled with the job and have no regrets. Also, since they will be able entertain at home in the new kitchen, they have no plans to move and feel confident it was a safe investment.

Isn't it nice to hear good real estate news for a change? So, let's all get moving with our own dream projects. Whether it's a kitchen, a bathroom, or even a swimming pool, now is the time to jump in the deep end instead of drowning in fear!

Source: HGTV Pro.com, Ed Del Grande: Ask Ed, April 6, 2009

Some Economic News (Read at your own risk!)

Both Kitchen & Bath Design News and Hanley Wood Market Intelligence Key Indicator Alert released their market updates yesterday. Both had a slightly positive spin because general sentiment is up a bit. There is also a slight increase in housing starts and increases in both new and existing home sales. Unfortunately, unemployment is at its highest rate since 1983. But, analysts say that job growth is the last thing to return after a recession. The reason? Businesses have cut back and will continue to produce as much goods and services as they can with as few people as possible in order to make up for previous losses due to the downturn.

Kitchen & Bath Design News did give some additional information that is of interest to remodelers and home improvement companies.

Market for ‘Green' Building Materials Outpacing Construction Growth
The U.S. market for "green" building materials generated sales of almost $57 billion in 2008 and is projected to grow 7.2% annually, to more than $80 billion, in 2013, outpacing the growth of building construction expenditures over that period, according to a new study from The Freedonia Group, Inc., a Cleveland, OH-based industry research firm. Although green building materials are expected to account for an increasing share of materials used, growth will be driven primarily by the recovery of the residential construction market through 2013 as it rises from its depressed 2008 level, the Freedonia Group said. Forest Stewardship Council (FSC)-certified lumber and wood panels are expected to be the fastest-growing green products, growing more than three times as fast as the overall market for wood panels, the research firm found.

Source: Kitchen & Bath Design News Market Update, April 2009.


AIA Study Shows Universal Design Trending Upwards; Upscale Kitchen & Bath Features Declining
As the housing market continues to decline, accessible and energy-saving products are growing in demand, while the popularity of upscale kitchen and bath features is declining, according to a new American Institute of Architects (AIA) Home Design Trends Survey.According to the survey, consumers are increasingly looking for products that are renewable, promote accessibility or save energy. By contrast, trophy-like kitchen and bath features are waning in popularity as consumers remain cautious in their spending habits. "Because of concerns over affordability and resale value, it's not surprising that there has been a sharp decline in demand for high-end kitchen and bath products," said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. "However, some products and features remain in high demand. Despite the difficult economic conditions, homeowners are extremely interested in renewable flooring and countertops, energy-efficient and water-saving products, as well as having a dedicated recycling center."

Source: Kitchen & Bath Design News Market Update, April 2009.

Chinese Drywall Update

There's an update on the Chinese drywall issue in South Florida. It's called

l - a - w - s - u - i - t.



Here's a great article from NewsInferno.com. It's the best I've found so far on the issue. As you can see, the drywall may have been used in more areas than South Florida as was originally reported.





Chinese Drywall Lawsuit Filed in Louisiana
Date Published: Wednesday, March 18th, 2009

A Louisiana couple has filed a class action lawsuit claiming that defective Chinese drywall is in their home. The Louisiana Chinese drywall lawsuit is just the latest indication that the toxic material was used in homes beyond Florida.


Usually, drywall is manufactured in the U.S., but a shortage during the housing boom prompted many builders to buy drywall from China. The Florida Health Department has received around 119 complaints about drywall that has polluted homes with a putrid, “rotten-egg” smell. Fumes from the drywall reportedly corrode air conditioning coils and other metals, and have also been blamed for respiratory and sinus problems. Some residents have been forced to move from their homes, and a few builders in Florida have begun gutting homes and replacing the drywall.


The drywall problems have already sparked several lawsuits in Florida. One of the first was filed in January by the Bonita Springs law firm of Parker Waichman Alonso LLP. The lawsuit, which was filed in the U.S. District Court for the Middle District of Florida, charges that Knauf Plasterboard and other defendants negligently manufactured and sold the defective drywall, which was “unreasonably dangerous” in normal use because it caused corrosion to air-conditioning and electrical components, and caused coughing and irritation of sinuses, eyes and throats.


According to the consumer group America’s Watchdog, drywall from China was likely used in the Deep South, the Midwest, the Southwest and the Pacific Northwest, including Vancouver, British Columbia, and even Hawaii. The group says the material was first introduced to the US in late 2000 or early 2001 and was primarily used in new US subdivisions, condominiums or home remodeling jobs. So far, America’s Watchdog’s environmental testing has found defective drywall in 41 states. In addition to Florida, those states also include Virginia, California, Arizona, Nevada, Louisiana, New Jersey, and Texas.


According to a report in The Wall Street Journal, the Louisiana Chinese drywall lawsuit was filed by a couple living in a New Orleans suburb. The class action suit, which was filed in the Eastern District of Louisiana, names certain drywall manufacturers as defendants. The complaint alleges that their house, which was built in 2006, is emitting the rotten egg smell, causing respiratory problems and corroding electrical equipment.


According to the Journal, the Louisiana Chinese drywall lawsuit has raised concerns that the defective material may have been used in homes that were rebuilt after Hurricane Katrina. The storm helped to create that shortage that caused so much Chinese drywall to be imported into the U.S.


USA Today is also reporting that a similar lawsuit has been filed in Alabama. A lawyer also told USA Today that there have been complaints about Chinese drywall in other states, as well.

Getting beyond set-backs

Sometimes things just don’t go our way. It’s true in our personal as well as professional lives.

Somehow we need to find ways to get beyond it. It’s tough, though. We tend to dissect the issue. Could we have done something different? Did we make a mistake along the way? Our focus re-directs inward and stays there, sometimes making it difficult to move on. We can begin to feel sorry for ourselves.

So how do we move on? If the issue was caused by you or someone else, forgive. If it’s an issue beyond your control, forget it. To turn your focus outward, begin by helping others.

Being all things to all people

John and I went out to dinner last night. On our way to the restaurant, we happened to be on the interstate. Both of us chuckled about the same time as we passed a construction vehicle. It was a large white panel truck nicely labeled with the company’s name and contact information, followed by what the company did. It was a good thing that it was a large truck, otherwise, the entire listing of this company’s services would not have fit!

Immediately under the company name was a line “Heating and Air Conditioning Contractor.” Another line under that spelled out Plumbing Contractor. And then came a paragraph about the other services this company offered – Custom Home Building, Remodeling, Siding, Replacement Windows, Handyman, etc., etc., etc. The list was pretty lengthy.

Trying to be all things to all people doesn’t work in this age of specialization. Just attempting to devise a marketing strategy for all of these services would make anyone’s head spin! And I can’t imagine the cost of trying to reach an audience in every market either.

Instead, focused specialization will help you to keep your marketing costs down while you reach buyers who are truly interested in your services.

Problem Solving Leads to Success

I love Brian Tracy. I have read many of his books and continue to listen to his tapes. He is an inspiring and encouraging speaker.

I found this video, Four Steps to Getting Past Obstacles, and thought it is quite appropriate for these times. Enjoy!

Some Good News? Maybe . . .

Hanley Wood’s Key Indicator Alert came out yesterday with some interesting information. According to the report, “. . . building permits, housing starts, existing home sales and new home sales all post[ed] increases in February.” Wow, that is good news.

I’m sure you’ve been hearing about the rebound on Wall Street, too.

Unemployment is still up but that is to be expected. Even at the beginning of the end of a recession, employers continue to shed jobs. That’s how they dig themselves out. And they won’t add new jobs for awhile either.

It will be interesting to see if this is sustainable for another month.

In the meantime, keep up your marketing, watch your expenses and trim them wherever possible. Keep in touch with your past customers, they are your lifeline. And don’t let the media get you down.

Here’s one of my favorite quotes:

“If you’re going through hell, keep going!”
Winston Churchill

How to create marketing content for your remodeling business without writing one word!

When you give your prospects and customers valuable information, they immediately consider you an industry expert. And consumers feel more comfortable buying from those they consider to be experts. In fact, when your prospects are looking to you for advice and information, it's a much easier sales process.

You would probably love to have more content to give to your customers and prospects, post on your website, or include in your newsletter but maybe you don't have the time to create it yourself or you really don't like to write.

Now there is a way to give your customers and prospects valuable information and post content on your website and blog, without writing one single word!

The solution is Marketing Packs - articles for consumers specifically targeted to home improvement and remodeling. You can use and re-use these articles for just about any purpose--your own newsletter content, website content, blog posts, consumer reports and much more.

Click here to find out more and learn how you can use Marketing Packs in your remodeling business.

Media bullies remodelers

(Warning: This post is a rant. Read on at your own risk!)

There’s a newswire story making the rounds.

The title? “With business off, remodeling gets cheaper.”

Cheaper?? Cheaper for whom?

The story originated in California but has been picked up all over the country, even by our own Housing Zone . You can read the story here on the original wire service.

The newspaper in my area that picked it up added their own special twist to the title:
“With business off and the economy in a downturn, remodeling gets cheaper.”

Jeesh. Can we catch a break? Now the media is telling consumers that our prices should be lower!

I beg to differ! I have not had one single call or letter from one single vendor that any of our remodeling company’s overhead costs are being lowered! Sure there are some material costs that are lower – take lumber and sheetrock (hopefully not the Chinese-made variety). But even the price hikes on materials over the past couple of years that were due to the increased cost of petroleum have not been reduced.

For the most part, our operating expenses are higher! Insurance has increased, rent has gone up, the postage rate is rising soon, employees expect raises, advertising costs are growing to bring in the same number of leads. I’m sure you have the same issues.

Where would the decrease come from? The only place left – your company’s margin. But don’t do it! That is a sure way to a quick death.

Don’t let the media scare you into cutting your margins. Instead, work even harder on setting your company apart from the competition. Make it almost impossible for someone to choose any company other than your own.

March Madness and Marketing

I have been a college basketball fan ever since my alma mater, George Mason University, made an inexplicable run to the Final Four in 2006.

Before that? Couldn’t care less.

Why the change? Because I got caught up in the Cinderella story of GMU, a sleepy, commuter school in the Virginia suburbs thrust into the national spotlight after beating teams like Michigan State, North Carolina and Connecticut. Now, not only do I follow GMU hoops, I also follow some of the other local college teams. I enjoy sitting down and watching a game. And I’m looking forward to March Madness.

That might be a little odd for a middle age woman who never played basketball. (For the record, I could play a mean game of horse with my brother and his friends!) But the point is we never really know what is going to capture our attention. And the same holds true with our prospects.

Our prospects move along through their busy lives until, one day, they begin to think about a remodeling project. We don’t know what starts the thought—a television show, a friend’s project, a lifestyle change. It truly could be a thousand different reasons. It may be the beginning of a plan to remodel, one that gets tossed around for quite some time. Or the idea may take hold and become uppermost in our prospect’s mind immediately. We really don’t know when and why the idea comes to mind. Just that it does.

And once it does, we must capitalize on that attention. And build on it. And that’s where our marketing comes in. We need to be “out there” so that when the prospect begins to explore the idea of remodeling, our company pops up. It might be in the form of an ad in a newspaper or magazine, or maybe a postcard, possibly our website comes up during a search. And it’s not going to be just once. The prospect will need to see us over and over again. That’s where our marketing plan helps us to be seen by as many prospects as possible and in a variety of venues.

Make sure that your marketing plan gives you the most bang for your buck. And be ready for the madness to begin.

Upselling is everywhere

I stopped in my local Starbucks the other day to grab a latte. I like (and always order when I go) a grande latte. I don’t go often because I have a hard time paying so much for a cup of coffee. But I decided to treat myself.

The person taking my order immediately asked me if I’d like a venti (large) instead. I said no. She then asked if I wanted a flavor. No, I replied. Finally, she asked me if I’d like to add a pastry or muffin. No, just the coffee.

Upselling is everywhere these days. I’ve been noticing it more and more. There’s the perennial upseller, McDonald's, with their now famous phrase, would you like to supersize that? Annette told me she went into Yankee Candle, a retail store that sells scented candles and accessories, the other day and the clerk gave her several options for buying up.

If you pay close attention, you will see it. And, if it’s done well, you will hardly notice it. Pay attention to the upselling that’s going on all around you. Try to incorporate it into your own sales. Offering a few more options with any job is a great way to give your customer additional value and increase the price of the job. But remember you only want to give upsell options that your customer may want to purchase or would benefit from. Simply trying to get your customer to spend more money with you is no way to go about upselling. If you know your customer, you will know what options are most valuable.

Good business is built on strong foundations

A strong successful business is built on a strong foundation.

Think about our industry. Whether it’s a one-story ranch or a 100 story skyscraper, the foundation must go in first and it must be built to last.

If the foundation is off just a bit or there is a small crack, there will be problems with the building. But start with a strong foundation, and the structure can last for years.

Build your business on a strong foundation and it will serve you well for years to come.

A small business' unique position

As a small business owner, you are in a uniquely powerful situation. You have the ability to implement an idea very quickly. In most cases you are the board of directors, owner, and manager all rolled into one. You make the decisions while larger companies must run those new ideas through the proper channels.

Immediate action can help you turn your company quickly in the proper direction.

A common factor for success

Can you guess what the one common factor in successful people might be?

If you guessed education or experience or money, you’d be wrong.

Give up?

The one common factor among successful people is speed of implementation.

When successful people get an idea, they begin working on it! They don’t run it by their spouse or friends or co-workers. They don’t think about it and mull it over for a couple of weeks.

They begin working on it – immediately.

Needed boost for the remodeling and home improvement industry

OK remodeling and home improvement company owners. Our stimulus package has arrived!

The federal government just gave the remodeling and home improvement industry a huge boost in the form of modifications to the energy efficient improvements credit.

For 2009 and 2010 homeowners can receive a tax credit of 30% of the cost of specific energy efficient products added to the home up to a lifetime cap of $1500. Those products include electric heat pumps, central air, water heaters, gas furnaces, exterior windows, doors and skylights, just to name a few.

Check out this article in Nation’s Building News or the Congressional Record for the actual bill.

Past studies have shown that existing homes, especially those built more than 20 years ago, are responsible for a large amount of our nation’s energy consumption. Retrofitting these existing homes with energy-efficient features is more effective in reducing energy consumption than making changes to new housing energy efficiency requirements.

The bill is very specific about what products qualify for the tax credit. For example, not all Energy Star rated replacement windows qualify. Qualified windows will also need to meet an additional requirement that the window is equal to or below a U factor of 0.30 and SHGC of 0.30.

So study up on which of your products qualify. Contact your suppliers and manufacturers to get factual, precise information. Get some marketing together and get it out there to your past customers and targeted new customers. And get back to selling.

Your customer wants to connect with you

You may think that customers want to do business with your business. But what they really want is to do business with you.

Customers are individuals and they want nothing more than to connect with other individuals.

Give your customers that close personal attention and make a personal connection

See life from your customer's view

Take a moment to daydream.

Close your eyes. Think about your customer. Who is he? Where does she live? Work? Play? What is he or she looking for?

Next (and here’s the hard part) step into your customer’s shoes. I mean really see yourself as your customer.

And then imagine the world through your customer’s eyes. What are the unique problems that he or she faces? Really see their point of view. If they are frustrated, why are they frustrated? If they are angry, why? Sad? What is it that makes them so?

Understand their emotions and their desires.

Now step back into your shoes and fill the needs of your customer.

Multi-tasking is not your friend!

You’re probably a multi-tasker. I know that I am. I write an e-mail while talking on the phone. I switch from task to task as a thought enters my mind.

I thought I was pretty good at it. And I thought I was getting more done. Turns out, I’m probably not.

Switching rapidly from one task to another creates interruptions and down time. Interruptions cause me to not fully finish the task at hand. And then I put it aside for later. Each time I start a task, there is some up-to-speed time. That’s the time it takes me to re-acquaint myself with the task and get myself back into the mind-set needed to finish that task. So if I add up all those little bursts of time spent, it can be much more than if I completed the task immediately.

Better, say experts, to block out chunks of time (usually 1 – 2 hours) to work through and finish tasks uninterrupted. Then take a short break, 10 – 15 minutes, to recharge. Stretch, get a drink of water, eat a small snack. Use a kitchen timer to help.

I’m still a multi-tasker at heart but I’m trying to finish each task I start before going to the next.

High levels of stress require downtime

If you are experiencing high levels of stress in your business (and who isn’t today with the current economic environment), it is important that you create periods of rest and relaxation for yourself.

You probably don’t feel much like resting, but turning our minds away from our problems for awhile can help us to look at the situation from a totally different angle. Many times, we find a solution or an idea that takes us in a totally different direction.

So decide what you like to do to help your mind and body relax. Remember, that your body is feeling the stress, too. Schedule yourself and then follow through.

History guides us in the remodeling industry

The other day, I stumbled upon some old Census Bureau statistics that may give us a little hope for our industry.

The Expenditures for Residential Improvements and Repairs statistics for 1966 to 2007 shed some interesting information. The report measured Total Expenditures, Maintenance and Repairs Expenditures, and Improvements Expenditures which up until 2004 was broken down between Improvements, Additions & Alterations, and Major Replacements. Starting in 2004, the Census Bureau dropped Additions & Alterations and Major Replacements from the Improvements category.

In the 60’s, both the Maintenance and Repair category and the Improvements category remained relatively unchanged and were both pretty modest.

In the early 70’s, improvements began to pick up, followed by Maintenance and Repairs in the late 70’s. That makes sense as all of those new additions and improvements now needed some attention to keep them well-maintained.

Along came the early 80’s, a recession hit and Improvements went down. But Maintenance and Repairs went up! The recession officially ended in November of 1982 and by the late 1980’s both Improvements and Maintenance and Repairs exploded.

That puts us into the early 90’s and our economy again suffered a recession from July 1990 to March 1991. Not surprisingly, Improvements again went down while Maintenance and Repairs increased in 1991 and decreased in 1992. But beginning in 1993, Improvements began their ascent while Maintenance and Repairs remained pretty steady through the rest of the 1990’s.

But wait, around 2003, Maintenance and Repairs again began to rise, due in part to (once again) work needed on all of those Improvements that had been built in the previous decade.

Unfortunately, the Census Bureau no longer keeps statistics on Maintenance and Repair so we can’t track that information after 2007, but if history were to be our guide, Maintenance and Repair would rise as Improvements fall during our current recession.

Does that give you some hints as to the type of work to be going after right now?

Looking for some good news in recent remodeling data

The Joint Center for Housing Studies released their Leading Indicator of Remodeling Activity in January and, not surprisingly, the news wasn’t good. The Indicator points to a decline in remodeling activity through the third quarter of 2009.

But if we dig deep, we may find some positives. Prior to 2008, the LIRA was based on numbers from the US Census Bureau that included Maintenance and Repairs expenditures along with improvements such as additions and alterations. But the Census Bureau discontinued the Maintenance and Repairs Statistics which also meant that the Center for Housing had to re-benchmark their Indicator.

Looking at the Expenditures for Residential Improvements and Repairs by Property Type between 2003 and 2007 provided by the Census Bureau, it’s interesting to see that Maintenance and Repairs held steady or continued to increase over that 4 year period.

Unfortunately, the Census Bureau no longer tracks this information. If they did, I think they could find that Maintenance and Repairs continue to hold pretty steady. Why? Because people take care of their homes. The home is an investment and if a homeowner wants to get the money out of the home, it needs to be in good shape and well maintained. Sure, we all see homes that are in disrepair every day, but these are not the people we are looking for as our customers.

Here’s what you can do today. Travel through your target area. Make note of the subdivisions and areas where the homes are well-maintained. Get back to your office and devise a way to reach those homeowners.

Sales is about the relationship

The other day the owner of one of our favorite restaurants in our little town left me a phone message just to say hi. She hadn’t seen us in awhile and just wanted to make sure that we were all ok.

My first thought was, how did she know my phone number? We’re friendly at the restaurant but that’s about the extent of it. And then it dawned on me that she kept my phone number when we’ve made reservations. There’s a smart business owner. She keeps as much information as she can about her regular customers.

Her concern was genuine and very much appreciated by me and my family. I called her right back and assured her that we were all ok, just busy. And I also made a reservation. One for this Friday when I’m taking two of my customers who just referred me for a bathroom job that I sold.

Do you call any of your past customers just to say hello? Do you stop to chat when you see a customer out on the street? Or at the mall? Or in church?

Selling is about making and maintaining relationships. It’s always been like that. Salespeople who can make those connections usually sell more. Why? It’s no mystery. Because people want to buy from those that they like!

On The Level Consulting Offers BASICS Business Coaching for your Remodeling or Home Improvement Business

OK, I'll admit right now that this is a shameless plug. This blog is all about our new BASICS Business Coaching for small home improvement and remodeling businesses. If you don't want to read it or you are not interested, you can stop reading right now. Check back with us on Wednesday for another (non-commercial) blog post.

I know from experience that being the owner of a remodeling or home improvement company can be really overwhelming. I wear many hats in my remodeling company's business - marketer, bookkeeper, supervisor, dish washer, file clerk, errand runner, admin assistant. John has even more roles with sales and production.

And I know how easy it is to get caught up in all the day-to-day challenges of running a business. Sometimes you can't see the solutions that are right in front of you. There's just too much going on.

But I also know from experience that you don't have to face these challenges alone. Years ago, I hired a business coach and it was the best money we ever spent! The coaching helped us get clear on what we wanted and how to go about getting it. And, yes, even coaches get coached. I remember our coach back then telling me about his business coach.

Because that coaching was so powerful and so life-changing for us, we know that it can be for others, too.

That's why we created BASICS. That stands for Business, Advertising and Sales Individual Coaching Sessions.

This is not general business advice. This is coaching specifically for the remodeling and home improvement industry. You know that there are lots of little peculiarities in our business. You really need someone who is familiar with this industry.

If you would like to find out more information about BASICS coaching, just click here and sign up for one free coaching session.

And if you've read this far, thanks for doing so.

Chinese-Made Drywall is Causing Corrosion

Have you read about the drywall manufactured in China that is corroding pipes, vents, and wiring hidden behind walls in Southwest Florida homes? Click here to read a recent article.

Lennar Homes, the builder in question, commissioned a study which found that the drywall is indeed causing the corrosion but claims that there is no risk to the health of the homes' occupants.

I'm sure that we have not heard the last of this. I wonder how far reaching this problem could be. How was the drywall distributed? Was the defective drywall sold in any other parts of the country? Was it used in commercial projects? Remodels? Schools? Lots of questions come to mind.

I'll let you know when I hear more.

Should you use a square foot price to estimate remodeling?

NO!!!!

Did I say that loud enough?

The answer is a resounding no.

Square foot pricing cannot take into account all of the variables of remodeling. Product selection, current condition of the project, jobsite access are only a few.

Do yourself a favor. After looking at the job site, prepare a detailed estimate based on the work that will have to be done for this particular job. Include labor and materials. Apply your mark-up. Stick by your estimate.

Happy Selling!
John

Post your ad on craigslist

Here’s a free lead source for you: craigslist.

You can post an ad there for free. Using html, you can even post your logo, photos, and create a nice graphic. Although you don’t even have to use html if you don’t want to.

Oh, and did I mention that it’s free?

Don't do business without a contract

I hope you have a legal contract that you use for all of your remodeling and home improvement work.

If you don’t, put down your tools and go right to your attorney’s office to get one. Otherwise you may end up there for not using a contract.

A contract protects not only the homeowner but you in case something goes wrong. It sets forth the full specifications of the job as well as what is expected from each party.

And if there is a change to the initial contract, make sure that you do an addendum. This can be a change order or additional work authorization or whatever you want to call it. But you have changed the initial contract and that, too, needs to be in writing, signed by both parties.

Are you selling every estimate you give?

If you are, then I bet your prices are too low.

You may be thinking: What? Too low? But I’m selling. I’m a great salesperson. My closing rate is 100%!

If your closing rate is 100%, you are not selling. You are taking orders. Try raising your prices, just a little at first, and see what happens. Your profit margins will be higher. Your cash flow will be better. And your closing rate will not be 100%. That’s ok, though. You are learning how to sell.

Happy selling!
John

Even if you are the owner, you need to track your hours

The reason? Because if you hired someone to do the same work that you do, you would pay them for it. Right? Which means that you need to provide for this time in your job estimates. You won’t know how much to put in your estimates unless you track your time on a regular basis.

It’s easier than you think. You don’t need to go hog wild with it. Start by breaking down your time in ½ hour increments. Using an Excel spreadsheet, divide each day into Production – on the job time; Superintendent – planning and supervising labor and materials time; Sales – meeting with prospects and preparing estimates time; Office – any administrative time; and Owner – working on your company time.

Enter time each day and total on a regular basis – weekly or monthly.

You may even find that you are spending way too much time working in your business rather than on your business. But that’s the subject for another day.

Market to prospects you want to do business with

I recently read an article about a contractor (I can’t remember his name but lets call him Bill) who was lamenting that he couldn’t compete against a company that employed illegal workers. He gave a specific example of a prospective customer who told him that he knew the other company used illegal workers and he didn’t care. He was willing to accept that for the cost savings.

Bill’s rhetorical question was “How do I sell someone who doesn’t see the value in doing business with me over a company that employs illegal workers?” The short answer is, “You can’t.” And the long answer is “You don’t want to.” Market your business to those customers you want to do business with. Don’t waste your time on those who don’t see or care about your value. It’s futile.

Do you guarantee your work?

We do!

That’s right, we give a 3 year labor warranty on just about all of our remodeling work.

Our state requires us to give a 1 year labor warranty. We decided, though, long ago that if we really wanted to stand out and if we really believed in our work, we would give a longer warranty than was required.

How has this worked for us? Great!

You may think that we are constantly being called to fix things. Nope. Most of the time we do the job right the first time around. But things definitely do happen. And when they do, we immediately make them right again.

I actually like knowing when we have a labor breakdown. That way I can track if we need to change our construction methods, our products or just be a bit more careful. I can also get an idea if an employee or subcontractor is not up to par.

A labor warranty works in another way, too. It gets you back in front of a past customer. And once you fix the issue, you have a happy customer. Many times there is more work just waiting for you.

Happy Selling!
John

Are you one of the best contractors?

I’m a personal subscriber to Angie’s List. I joined about a year ago so that I could track what information was being disseminated to subscribers about contractors.

I was excited to read that, according to a recent poll, most Angie’s List members have outstanding experiences with home improvement contractors. In the same breath, though, most of those same members have had at least one bad job in the past. That’s too bad. And it’s a negative mark on our industry.

Unfortunately, the media dwells on the bad over the good in the construction industry. And Angie’s List does, too, except that they also include a Best Contractors list.

I found their Best and Worst Contractors List of 2008 to be interesting, not from the point of view of the horror stories, but from the point of view of the positive stories about the Best Contractors. The Best Contractors were chosen because of their superior service, charity or community work, and child and pet friendliness.

Do you have what it takes to be on a list of the Best Contractors? Do what it takes to ensure that your customers have an outstanding experience.

Inspect what you expect

According to many experts, in order to get more accomplished in your day, you have to delegate some of your duties. Which ones? According to Brian Tracy, be ready to delegate anything that you possibly can to anyone who can do the task.

Of course, as Brian points out, delegation is not abdication. You must follow up and make sure that your delegated tasks are being completed on time and correctly. Supervise and schedule time to follow up.

Looking for work? Think outside the box

Like this young man in Seattle, Washington. He has developed a unique and low cost way to gather leads for his architecture firm. John Morefield has been laid off twice but he’s not letting that stop him.

What unique ways can you think of to bring in more leads?

Are you trying to sell every job?

You don’t have to sell every job. There are some jobs that just don’t fit your niche. There are some prospective customers you will meet who don’t fit your customer profile. There are some locations that don’t fit your geographic service area. Learn how to say no to the jobs that just don’t fit.

Happy Selling!
John

Gloom or Boom? You Decide

The naysayers, specifically the media, would have you believe that our economy has ground to a halt. Run and hide, Chicken Little. The sky is falling!

If you choose to listen to their messages of gloom, the sky will fall for you. But if, instead, you choose to believe that our economy can and will support your business, well then it’s a whole different ballgame.

The most important thing you can do right now is to be flexible. Be willing to change your business model. Tweak your products so that you offer those that your market wants to buy. Add or subtract services so that you can reach the most consumers. Be willing to do what it takes to survive and thrive.

Take advantage of sales training

Although some manufacturers, like Republic Windows and Doors, are shutting down, others are gearing up for a successful sales season. We recently received an invitation to Home Guard Industries’ Dealer Training and Workshop. Training such as this is geared toward helping us, the home improvement contractor, sell more. Find out what your suppliers are planning this year to help you sell more. If they have no plans, suggest that they provide some training and assistance. After all, it is a direct benefit to them if you sell more.

Happy Selling!
John

Happy new year

I love new year’s day. It’s a day of newness. The whole year stands before us, waiting for us to decide where it will take us and how we will get there.

Will this be your year to shine? Only you can make it so.

Decide now. Set your goals. Write them down. Review them often. Devise a plan. And take action.

Happy new year!
Annette

May 2009 be successful in every way possible.

We appreciate each and every one of you.

John and Annette