Most remodelers start a business for their own purposes and then they find customers. That model worked in the past when there was plenty of work and lots of customers seeking a contractor. But those days are gone. Perhaps it’s time to install a new operating system and click on the reboot button. For your business to return to thriving, it will have to serve the homeowner first, you second.
Though middle-market homeowners no longer view homeownership as a way to build equity, they have some commonalities that you can use as the basis for a new business model. First, they are concerned about the long-term costs to live in and maintain their homes. Many owners can’t afford or do not qualify to borrow the money needed for a new home. First-time buyers will probably buy homes that need work so they can get the location or size of home they want and will improve them over time. Second, many owners plan to stay in their homes much longer than was typical in the past, including staying in that home after retirement. Plus, their home’s resale value will be based on maintenance costs and living expenses — things that interest future buyers.
These middle-market owners look at how the house will serve their needs. This provides an opportunity for remodelers, but it calls for a change in perspective. Rather than “customers for life,” consider the “house for life.” If you have intimate knowledge of the house, its systems and performance, completed work, ideas for future efficiency improvements, including costs and payback, and you keep all the related data about the house, you could be the expert the new owners want and need to help them maintain the health and efficiency of that home.
This model brings up some important considerations. Before you can educate the homeowner about their options, you have to learn about the options yourself and become fluent discussing and pricing them. You will need technology to capture the home’s information so it remains your property if and when they leave their home. You’ll need a secure customer portal where owners can view your data and add their own. You will have to offer services beyond just improvements, possibly cleaning gutters, cutting the grass, raking leaves, cleaning chimneys, and clearing snow and ice off their roof.
Being a good carpenter is no longer a sustainable business model or valid retirement plan. Consider becoming a strategic business owner and finding ways for you and your team to become housekeepers.
—Shawn McCadden founded, operated, and sold a successful design/build company. A co-founder of the Residential Design/Build Institute, Shawn now speaks at industry events and consults with remodeling companies. firstname.lastname@example.org. Click here to read more from Shawn McCadden.