Much has been written about what general remodelers must do differently and must put in place at their remodeling businesses to make the transition to what I refer to as a “true” or “real” design-build structure. Additionally, remodelers who do or want to do design-build must act and think differently than general remodelers.
As I have shared many times before, design-build is not just a service your business offers. I think it’s important to understand and believe that being a design-build remodeler also requires a design-build mentality. Until you think like a design-build remodeler, you are likely only acting as one.
3 Important Ingredients
To have a design-build mentality, the business owner must always consider three things to truly offer a design-build solution for a client’s needs or challenges.
No. 1: You must seek and identify your prospect’s true purpose for the project they are requesting. Sure, they may say they want a new kitchen or bath because the existing one is old or outdated. These are symptoms, not reasons. Real reasons may include more room and a better layout for two cooks or a larger space so a growing family can eat together. Another real reason ties in with preparing a home for aging-in-place. Find out more about their real reasons, and you can design the right solution.
No. 2: You must know their true budget. Until you know this for sure, and you have a commitment from the customer on how much they will spend for their project, you cannot design-build a solution for them. Remember, with design-build you are designing to a budget and budgeting the design as it progresses.
If you proceed with design without a firm budget commitment or allow the design to exceed the agreed budget without a written commitment to the additional cost, you are still a “bidding” contractor, hoping they will buy from you. Worse, you may be wasting time and resources with people who’ve not made the financial and emotional commitments required to make the project and the required solution a reality.
No. 3: You must know how they make decisions about spending money, setting priorities for project goals, and how they make product selections and many other decisions required to confidently move forward with spending money and spending it with your business. This might be the most important of the three necessary ingredients.
As a design-build remodeler you cannot risk assuming any of these three things. You must come to agreement on them with your prospect before you can offer your design-build agreement and well before starting the process of designing and specifying their project. Without these three things agreed to, you will fall into the potential and perpetual trap of design-bid-redesign-rebid and hope they say yes.
The Difference Between Sympathy and Empathy
There is a need and a place in our lives for both sympathy and empathy. However, to make and protect profits at your design-build business and serve your customers, you must always remain empathetic and avoid becoming sympathetic. Sympathy is when you share the feelings of another and, as a result, make their problem yours as well. Empathy is when you understand the feelings of another but do not necessarily share them. Dealing with the budget and talking about money must be done with empathy.
A real conversation about whether their budget is practical for the desired or required project should not be compromised by becoming sympathetic. If your prospect won’t commit to spending what’s required for your company to complete their project, you need to be empathetic.
Being empathetic means you either help them understand you can’t help them, or you help them understand what you can do within the budget they will commit to. You may also inform them of the items on their wish list they may need to remove in order to stay within that budget.
Unfortunately, I see too many remodelers claiming to be design-build remodelers who practice sympathy in their sales, design and specification process. I see this happening in two primary ways.
The first is that they make the prospect’s budget problem theirs by lowering their price for the project and or giving things away either for free or for far less than they should to maintain a planned profit. A common example is including something like the cabinets and or the solid surface counters at cost to help the customer save on the markup and keep the project to their insufficient budget. If you do this, you must think of it as your business writing a check out to the customer for the difference you should be charging them and attaching it to your contract.
The second byproduct of a sympathetic approach happens when—even if you and they agree to a budget, during the design and specification stage—you allow them and your team members to design or specify something that you know isn’t within their budget. Furthermore, you don’t get a change order from them committing in advance to the extra cost.
When you allow this to happen, you are being sympathetic because they have a problem with paying for the additional costs. And by not helping them concretely address whether they should increase the budget to cover the change or give up the change to stay with the budget, you and your business just took on their problem along with them.
Preventing the Risk of Becoming Sympathetic
As a true design-build remodeler and to prevent you and your employees from becoming sympathetic to your customers’ problems, you should already have in place and strictly follow a documented way of doing business. Additionally, you should use a design-build agreement that explains in clear and unambiguous terms how you do business, as well as what will need to happen if your customer wants or tries to deviate from the agreement.
When agreeing to the budget, you must (in addition to describing things like the scope of work and level of finishes assumed that the agreement would describe) include an addendum of a change-order form to be used to identify the desired changes and any additional costs.
The agreement would clarify that the use of and signing the change order would be required before any changes could be made to what was initially agreed to when the original budget was confirmed. By doing it this way, your prospect knows upfront that you’re serious about your process as well as how serious they need to be when committing to a budget.
Having all this figured out and agreed to before you do business with clients will help you and your employees avoid becoming sympathetic simply because you feel bad for your client. With an agreed-to process to refer to and follow, you and your employees can remain empathetic because everyone will already know and be confident about what should happen next.
You can download a free copy of Shawn’s sample Design/Build Retainer Agreement here: https://www.shawnmccadden.com/Sample-Design/Build-Agreement-from-Shawn-McCadden QR
Shawn McCadden is a speaker, business trainer, columnist and award-winning remodeler with more than 35 years of experience. He can be reached at shawnmccadden.com.