SMB Peer Groups are Good for Business

John, an SMB client of mine, learned that giving away less work has led to more business.

Let me explain.

John runs a home re-modeling business. When contacted by a potential customer, he would schedule an appointment to visit the house. Then, he would go to the house, take measurements and talk to the customers about what they are looking for. John would return to his office, create a design concept and show it to the potential customers, hoping they decide to move forward.

This process led to three possible outcomes:

  1. The customers love it, and make a downpayment.
  2. One of them likes it, while the other thinks he can build it cheaper and walks away from the meeting with a free design.
  3. They don’t like it or want to look around at other options.

In two out of the three possible outcomes, John loses time, resources and a potential client.

Now John is a member of a peer group of other home remodelers, who get together every quarter and consult each other about how to improve their businesses.

At a recent meeting, John heard one of the other members talking about implementing a “Design/Build” business model. Design/Build models are different because the design is not shared until the customers commit to the project. One study reveals that Design/Build projects are delivered 33.5% faster than projects that are designed and built under separate contracts.

For John, here is how implementing a Design/Build model changes his process. When contacted by a potential customer:

  • An appointment is scheduled for the customers to visit John’s office.
  • The customers talk about what they want, and John educates them about what to expect and his process.
  • John talks about what separates him from other remodelers and why working with him is their best option.
  • The customers like what they hear and make a downpayment for John to start the design process.

Which means, John does a lot less work before getting paid. He may have fewer appointments, but John’s conversion rate is a lot higher.

Peer groups offer tremendous access to information and resources. Assuming that you are the only person ever to experience a particular problem and requires a unique solution is short-sighted.

Questioning everything — even the notion that giving away less yields more sales — will lead to answers.

Sometimes, it takes an outsider to see the questions that will re-shape your business. If you can’t find a peer group, don’t know where to start, or just want someone who is really good at asking the right questions, please reach out to me.