4. Focus on your customers
Today, there are easy marketing options to reach the customers who will be searching for your home renovation services online. It costs very little to make a website and social media profiles. Boost their reach with Google and Facebook ads.
Even with a good online presence, it’s important to remember that word-of-mouth from satisfied customers is the number one source of referrals for many self-employed home renovation entrepreneurs.
The most successful general contractors often have strong relationships that help them get the best jobs.
When you’re first starting out, you’ll likely have to rely on your networks. There’s a very good chance you might find your first clients through relatives, friends and people in your neighborhood. Offer discounts and ask people to help spread the word.
Doing jobs for lower costs at the beginning is an excellent way to sharpen your skills as you ramp up. It’s also a huge marketing opportunity, as you can start filling up your website and social media with genuine and positive customer reviews.
Remember to follow up with your customers after each job to make sure they’re happy and address any issues.
Take photos before, during, and after your home renovation work, with your customer’s permission. These pictures will be worth a thousand words on your website and social platforms. For your potential customers, seeing is believing.
5. Build industry relationships
In the home improvement business, your industry relationships are vital.
Because this business involves so many skills, a general contractor’s success depends on the quality of the people they work with, from subcontractors to suppliers. That’s why it’s so important to network.
If you have the industry contacts to pull together the right professionals quickly, you’ll be able to take on jobs that your competitors can’t.
Consider joining a local chapter of organizations like:
- National Association of the Remodeling Industry (NARI)
- National Association of Home Builders (NAHB)
- National Kitchen and Bath Association (NKBA)
You can meet other contractors and industry professionals who can help you grow your new business.
Networking with other industry professionals, like wood, metal, glass and paint suppliers, can also become a great source of early referrals for your home remodeling business.
Make sure to invest in those relationships as you would with customers: they are key players to have on your team.
6. Give good estimates
A good contractor must become proficient at estimating the costs for each job.Larger construction firms have estimation departments that handle this, but you’ll likely have to do this yourself or hire an estimator for a while.
To prepare a bid, you’ll need to create a quantity takeoff (QTO), which is a detailed table itemizing the cost of materials. You’ll also need to calculate your overhead and profit margin. There’s software that can help you do this, but you can also do it by hand.
It’s tempting to underestimate to get a job when you’re starting out and then raise the estimate as the job gets underway. However, try not to do this; it upsets clients and hurts your reputation.
Instead, make sure to work closely with a client to get as much information as possible about their needs. Then give a solid, accurate and transparent estimate.
7. Manage your cash flow
In this business, time is money, and cash is king.
Whether your home renovation business succeeds or struggles often comes down to whether you can effectively manage your cash flow.
Materials and labor cost a lot, and you might find yourself stuck if you don’t have enough cash to buy materials or pay subcontractors on time. Figure out your start-up costs, how you’ll collect deposits and payments from your clients, and have a plan for what happens if a client falls through.
It can help to learn accounting basics and invest in some invoicing and business finance tools.
8. Keep growing
As you gain experience, you’ll be able to hire more help and take on bigger, more complex, and higher-end jobs.
Many experienced general contractors get certifications that can impress clients and help them get more opportunities. NARI, NAHB, and NKBA all offer highly-regarded certifications for home renovators and remodelers.
To stand out further, you may consider focusing on a niche target market that caters to the kinds of residences near you. For example, if you work near an urban area with lots of crowded apartments, you could advertise small space design solutions. If you live near a beach, you could focus on deckbuilding or kitchen remodeling for vacation homes.
After some projects, you may be able to gain an income stream by offering maintenance plans for any renovations that require regular check-ups.
