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 While working on the project, he noticed that the client's kitchen was outdated and much in need of new flooring, countertops, and a backsplash.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.