How to Build Alliances with Your Competitors

You should have strong relationships with other contractors in your market – you might need them someday.

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Most contractors, at some point, realize they cannot do it all. As a small business gains in reputation and builds a strong customer base, it becomes more critical that scheduled work gets completed on time.

While having more work than you can handle is a nice problem to have, it requires creativity in meeting customer needs and work schedules. Such creativity might include building alliances with other contractors, both companies that complement your efforts and your competitor's. This might sound like a crazy idea, but keep reading.

How to find the right partners

Building alliances with other contractors should begin long before you are overbooked. Developing a professional relationship with other contractors allows you the opportunity to assess the work ethic, customer focus, and attention to quality that competitors and other contractors possess. While you may find it difficult to talk openly with competitors, your effort will pay huge dividends later when you are engaged in meeting all of your customer’s demands.

Here are four tips to help you build an alliance with other contractors.

Tip #1: Keep a running log of competitors who perform professional work

In your daily travels and interactions within your market area, take note of the work done by competitors. Most good contractors do this anyway but often fail to keep an active log of the competitors and their performance results.

Tip #2: Invite your competitor to breakfast or lunch

Initiating this effort sends a message to your competitor that you are not threatened by them and do not view them as “the enemy” but instead see them as a respected competitor. You might be surprised at how open and honest your conversation can be. Often, owners can exchange viewpoints with each other that might be impossible to get from an employee.

Tip #3: Ask your competitor about their commitment to quality, customer satisfaction and accountability

While every contractor can talk quality, ask your competitor what they have done internally to accomplish such results. Share your own struggles to improve your organization’s approach to quality, the customer and accountability. If you do not get an aggressive response initially, don’t fret; it may take your competitor a little while to realize they can trust you.

Tip #4: Ask your competitor if his or her company would be interested in fulfilling some of your work under your company’s name

Only ask this question after you have established a relationship with your competitor. Keep in mind that some contractors are not especially gifted in marketing or selling. Such a contractor could be a perfect match for you if you are strong in such areas.

The ground rules

Building alliances with competitors can be good business for a fast growing business. Such relationships can strengthen your strategies for growth while also meeting your customers’ needs. However, several items need to be understood between you and your competitor in order for a strong alliance to exist.

  • Your competitor may have equipment on the job with their company name stenciled on it, but their workers must realize that it is your company’s reputation on the line and act accordingly.
  • Your competitor must agree to avoid soliciting additional work with your client behind your back. Likewise, you must abstain from talking negatively about your competitor to a customer.
  • You must be crystal clear about instructions and requirements that will be met in order to fulfill the job. You must personally take full responsibility to ensure that every piece of information about the job is made clear with your competitor and that their workers fully understand the job needs. You may need to spend extra time monitoring the first few jobs with your competitor until both parties reach a comfort level with each other.
  • Both parties must realize that even with great communication, problems and mistakes may still be made. As tempting as it may be to hold payment for the completion of a job over the competitor’s head, this tactic will not build positive and trusting relationships. Your own crews can cost you money in rework, so can outside crews.

Approached carefully and thoroughly, building alliances can be a positive experience for you and your competitors. Such relationships can help you grow your business, take on a greater diversity of work or strengthen a weakness within your company.