Credit: Mark Robert Halper
What’s your niche? When I ask remodelers this question, most name an ideal type of project, such as kitchens, historic renovations, or windows. A better answer extends to other ideal characteristics as well, such as clients, neighborhoods, and seasonal considerations.
My company didn’t really pinpoint its niche until its fifth year of business. At the time, our work consisted mostly of repairs and small improvements, as well as bigger jobs that required us to bid on other people’s designs. Our frustrations with the bidding process — and our desire to use our own designs — were the impetus for us to create our first real, written marketing plan.
Around the same time, we began to fully embrace design/build. But that was just one characteristic of our niche. To clarify the others, we asked ourselves “the five Ws,” helping us strategically assemble the characteristics that consistently provided us with successful, profitable projects.
We identified our ideal client as a middle-aged, middle-market, dual-income married couple with school-age children. Typically, they were hard-working and respected the same traits in my employees and myself. They saw us as their partners in the project, and they were conscientious about paying us on time — unlike some wealthier clients I had worked for.
Space was the main reason most of our clients wanted to remodel. They needed more room, but they didn’t want to relocate, due to their jobs and school systems.
While our clients thought they wanted a simple addition, we wanted an addition with a kitchen and/or a bathroom. We had learned that simple additions made us compete with inexperienced, low-price remodelers who usually lacked the skills to design and build projects with kitchens and bathrooms.
We also liked that these projects were material- and trade contractor-intensive (easier to manage and mark up than labor), and that they brought in more gross profit, in less time.
We timed our marketing relative to the realities of New England weather and to the typical lead times for selling, designing, and permitting additions. The idea was to get foundations in the ground and shells constructed before it became impossible or impractical to work in the cold. Similarly, we marketed in advance for indoor projects to fill the cold months.
As the business grew and competition increased, we had expanded our footprint. But detailed job costing showed us that commuting more than 30 minutes raised our costs and compromised our project supervision, client satisfaction, and referrals.
We had also found it ideal to work on homes built in the 1960s or later, which were built with standard lumber sizes, drywall rather than horse hair plaster, PVC drain lines rather than cast iron, copper water supplies, and poured concrete foundations. Because these homes were easier to work on, we could better anticipate and estimate costs. Plus, they typically had similar neighbors in concentrated subdivisions.
Hence our geographic focus: targeted, high-exposure, high-referral neighborhoods within 30 minutes of our office.
This was the easy part. By concentrating our efforts on a defined niche, we became more efficient. We simplified estimating and sales. Finding and training good employees became easier because work types were fairly consistent and clients were a pleasure to work with. And by successfully delivering the right projects to the right people, we enjoyed a steady flow of high-quality referrals.
—Shawn McCadden founded, operated, and sold a successful design/build remodeling business. A co-founder of the Residential Design/Build Institute and former director of education for a national K&B remodeling franchise, he frequently speaks at industry events and consults with remodeling companies. email@example.com.