Up Front: Are They Satisfied or Loyal?
A satisfied customer is a good thing. It generally means the client felt they received fair value for goods and services, but will they be loyal? While a satisfied customer is good, it is loyalty you really want. Customer loyalty can keep you in business through tough times. We all strive to have our customers become loyal clients. In the case of the wall and ceiling contractor, I believe there are various levels of loyalty and any contractor who has been around for awhile has been through this maze.
Bidder on the inside track: You bid the job just like everyone else but they like you if your price is right. You are led to believe you know where you stand, you call in to check and hear phrases like “We really like you, but your number is just a little high.” The scenario then plays out to get you to drop a certain percentage. They never let you know exactly what that number is but you have a satisfied customer, mainly because you are the cheapest and can be counted on to perform. This is not where you want to be. Yes, you can survive, but there are better customers out there. In reality, the customers have about three of you on the “inside” track.
Last looker: This is a step above the inside track, because you get the last look. Considering the competitive world, the last look, and I mean a real last look, is a pretty enviable position. It proves they do want you above all others. You will probably have to match some lower numbers than you like, but it could be a lot worse.
You’re our guy: Here is where every contractor wants to be. You bid and you get the work. You never or very rarely hear anything about your bid price being too high. Your client may be getting another bid, just to make sure you are “in the ballpark” but you always get the work. This is what you strive for. It is pretty rare but does exist even in these tough times and it should be treasured.
Wouldn’t you love to be the only bidder, without having to keep shaving your bid because they really want you? For manufacturers and dealers, loyalty is more common; the loyal contractor may look at prices, but only to keep you honest. I also believe manufacturers and dealers treasure this relationship a bit more. How do you know if you have achieved loyalty? You will be doing most of their work or selling most of the product to them. The real test of loyalty is when an emergency quick job comes up, they have no time for bids and need action more than a price and they call you and only you, because they trust you and know you can perform. Congratulations, you have achieved client loyalty nirvana. If you get this status, don’t blow it.
I actually knew a subcontractor who refused to do a small bathroom for his most loyal client, because it was not worth his time. He eventually lost that client.
Loyalty nirvana is not easy to reach and there are some customers you may not want or desire the loyalty status with. All of us know these types of clients. We may do most their work but constantly they continue to push for deals or look for freebies. You don’t cut them off because the work is steady, the environment is tolerable and the pay does come, albeit even a little late. If most of your customers are these type and many of mine were, I feel your pain. I call these customers the “B” list customer. Better than being broke and better than filing bankruptcy.
Every once in while you meet that potential client, the one who you want that loyalty nirvana with. The trick is to get in with them. Because they appreciate a good subcontractor and pay on time, they probably have loyalty with someone else and do not bid-shop everything to death. They are the toughest to get in with and the best to have. You have to be good and you have to be good, every single day, day in day out. It’s not easy, takes a lot of planning, and tireless hard work to build a reputation like this and keep clients.
Some of us look at established successful subcontracting firms and think the owner has it made with his luxury car and impressive home. However, he paid for it with countless hours of hard work, good decisions, sleepless nights, successful strategies and being reliable day in and day out. If it were easy, everyone would be a successful subcontractor. Lots try, but few make it. Consider the fact that more than 70 percent of subcontractors fail within the first seven years-it is amazing and admirable to see firms who have survived 30, 40 or even 50 years. I am not jealous of them-OK, maybe just a little-but I admire and applaud them for their success in overcoming such overwhelming odds. They made it because they pushed beyond mere customer satisfaction and built that nirvana loyalty with a few valued clients. Any contracting firm that has lasted years can explain the difference between customer satisfaction and client loyalty and the challenge to get there.