Many remodelers and contractors run into problems getting commitments from potential customers. The cost of projects scares away some homeowners and design agreements are not applicable to all jobs. While design agreements still should be a first choice in most sales situation, consultant Michael Stone advises using letters of intent to get commitments from clients.
A letter of intent simply secures a spot on your production calendar. The client is committing to having you build their project, and you're committing to holding a spot in your schedule for their job.
The letter of intent should include selections homeowners need to make in order for the contractor to do the proposed job. However, Stone cautions, securing work is only finalized when there is a signature on the dotted line and money changes hand. Therefore, even with the letter of intent, no firm commitment is established until there is an exchange of money.
Another useful tip for securing commitments from Stone is to avoid clients who only want a low price and instead focus on homeowners who are ready to buy. This is a strategy that not only saves your time and knowledge, but ensures you secure enough work to turn a profit and maintain the ability to provide for yourself and your family.
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