For contractors, a well-managed database isn't just a good idea, it's absolutely essential for communicating with prospects, as well as with current and past customers. To effectively manage a database, a contact management system is simply a must. For some, this means investing in customer relationship management (CRM) software to help maintain a cross-referenced database of information. For others, a low-tech filing method to keep track of business activities is all that's needed.
Everyday on the job, contractors receive valuable data and nuggets of information that can help generate new business and increase sales from existing customers. Unfortunately, too often, this information is lost as soon as it is received.
For example, John is a bathroom and kitchen remodeling contractor who has an incredible array of service offerings that include tiling, countertop replacements, and plumbing work. He recently successfully retiled a shower, far exceeding his client's expectations. While working on the project, he noticed that the client's kitchen was outdated and much in need of new flooring, countertops, and a backsplash. He even briefly discussed the topic with the client who expressed interest that this would be something that she would possibly like done in the next six months to a year.
Unfortunately, John never wrote down any of the information regarding her kitchen. Once the shower project was completed, he had forgotten about the possibility of obtaining future business at this home. He didn't keep a record of the conversation and never contacted his client again.
Guess what happened? John was successful at planting the seed in the client's head about the kitchen repair work. However, she had lost John's card and subsequently decided to work with another contractor.
What John didn't realize is that he was actually nurturing new business through the conversation with his client. There was value in the information that he had received, and he needed to retain it and use it effectively if he was going to reap any of the benefits. The outcome - John's business development strategy worked, but his competitor was the one who ultimately profited. And, because John never did call the customer, he never even realized that he had lost a job worth over ten thousand dollars.
This very scenario is played out every single day by countless contractors who are lax at recording information, maintaining databases and following up. Ironically, these very same individuals will pay incredible amounts of money for direct mailing pieces, yellow page ads, and glossy brochures to reach out to customers. Meanwhile, they're neglecting the low hanging fruit that can be converted into real sales by simply staying on the grid with their existing contacts.
Prospects and clients should always be considered lifetime referral sources, not one-time connections. If you're keeping in touch with them by utilizing the information that you're maintaining, you will maximize your opportunities to win new business, cross-sell, and receive referrals. Successful data management can literally be your most important source of business development regardless if you're a solo contractor or a large-scale business with multi-million dollar contracts.
What should a database include?
The obvious basics that any database should have are name, address, email address, telephone, and fax. However, it's just as important to have a record of past and current quotes, as well as information gathered during conversations. This includes budget, preferences, maintenance schedule, current suppliers, future plans and any other pertinent details.
For small contracting firms that have few funds or little time for managing data online, information can be simply maintained in hard copy files. Alphabetized customer and prospect files can be kept in a cabinet and monthly records of activities can be detailed in a notebook or ongoing log. The key is keeping this up-to-date.