BUSINESS SUPPORT FAIR PAYMENT
N aive and keen – that’s how Nik Nelberg, describes himself in the early days of running his business. “An award-winning architect asked us to price a glass extension. We were naive but keen,” says the Managing Director of FMB member Earl & Calam Design & Build Ltd in London. “The drawings looked minimal, and the architect convinced us just how simple this build would be.” But you can guess what happened next. “We won the job after the architect picked apart our price and reduced it further. We soon found out how much work it takes to build to minimalist detailing – only after being tied to a JCT contract. Later we learnt the project wasn’t even going ahead – until we came along – because the other builders’ bids were way over the client's budget. Needless to say we lost a lot of money.” Many builders will sympathise with this story.
Six key questions 1. Where are the gaps in your pipeline? To achieve your target turnover, determine how many projects are required, at what value, and how many can be run simultaneously. 2. What’s your success rate? Calculate the number of jobs to achieve your pipeline of work. 3. How do you find these opportunities? Via social media, word-of-mouth referrals, advertising or online directories like Houzz UK. 4. Do you have a pricing process? Ensure the pricing process is consistent, follows a framework, and is quoted correctly and accurately. 5. How do you present your price? Consider an official brochure that includes company information and client reviews. 6. What sets you apart from the competition? Communicate your unique value proposition to prospective clients.
Demonstrating value Winning the right work is more likely when clients see your value. The “value for money” point, Coulter explains, is the sweet spot at which both the business owner and customer are happy with the price-to-value ratio. This is achieved by: Demonstrating what sets you apart from the competition; and Showing how this offering is worth the cost to clients. Nelberg says: “The module has given us confidence to understand that we offer a brilliant solution. It has taught us how to market that solution to customers so they can tell us apart from builders quoting lower prices because of the better value we offer. “We have been working for years to offer a design and build service that allows customers to choose wisely how they spend their money. We show them that we deliver a quality service at a mutually agreeable price that allows our business to make a small profit while best serving our customers.” Define your purpose Perhaps surprisingly, being paid what you’re worth is less about chasing money and more about defining your purpose.
savvy, but he still found value in completing the FMB Pilot Coaching Programme – particularly the module on winning work and being paid your worth. “If we charge the right price, our business runs smoother and we are able to better serve our customers. No more undercharging from fear of being thought of as a rip-off builder or worrying about not winning the work,” Nelberg explains. This was one of his key takeaways from the coaching programme. “We need to be clear with clients that we offer a lot more than a great end product. We have the knowledge and experience to design and build to their budget, work honestly and take the stress out of investing money into their property.” Construction Coach Maria Coulter, who has been leading the coaching programme, says SME builders should charge clients a price that is worthy of their work. The first step, she says, is asking sensible questions to help win the right kind of work.
Fortunately for Nelberg, years later, he’s a lot more
Winning work and being paid what you’re worth go hand in hand for successful builders. Here’s how to ensure you get it right THE PRICE IS RIGHT
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Master Builder
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