Lynn Gallant in Indianapolis is cautiously optimistic about the economy. The vice president of sales and marketing at family-run Spivey Construction says that the company now has more leads and more signed contracts than at any other time in 2009. “We took jobs in the first half of the year that are atypical for us -- like insurance restoration. We’re now getting good-quality leads,” she says.
Gallant had a similar cautiously optimistic view in March, but that did not pan out as she'd hoped. She says she did not factor spring break into her sales cycle because she was previously unaware that that lull existed. In the past, the company had enough backlog and projects in progress that staff were kept busy throughout the spring. This year, however, Gallant realized that spring breaks for local area schools are staggered, and parents do not want to discuss remodeling during that time. “It affects an entire month of our selling cycle," she says. "We were gaining momentum in March, then people started taking time off for trips. They do not want to see you the week before, during that week, or the week after.”
The company continues to rely on its 70% repeat and 82% referral business and has not decreased its marketing spending. Gallant finds that Spivey Construction, established by her father in 1945, is now competing with less-established companies. “On Angie’s List, we’re being compared to companies in business for two to five years. Homeowners think all companies are created equal,” she says.
Spivey Construction's website and marketing materials stress the company's longevity. Sales staff also encourage homeowners to thoroughly research other companies by not just speaking to past clients, but also checking business referrals such as suppliers and subcontractors. “Suppliers can tell you if a company is viable or [if they are] someone who is not paying their bills,” Gallant says. This is especially important in today’s economy where some contractors are dropping their insurance to make ends meet.
Another issue that Gallant's company is dealing with is delayed material deliveries due to manufacturing company delays. “Early on, they still had a supply, but as they laid people off and downsized, it’s now taking longer to get materials,” Gallant says, noting that she expects these delays to increase as remodelers become busier.
Since Spivey Construction collects interim payments at specific material delivery benchmarks, these delays affect cash flow. They also affect scheduling. “It’s a juggling act right now," Gallant says. "We’re trying to keep all our balls in the air and the financial side flowing so everyone is happy.” --Nina Patel, senior editor, REMODELING.
Editors Note: Have you found the same types of delays that Lynn Gallant mentions? Are delays related to specificmaterials? Some remodelers have mentioned that they are experiencing faster cabinet deliveries because the factories do not have as many orders to fill. What have you found? Comment at the end of this article or contact Nina Patel at email@example.com.