What’s Your Backlog Stomach?

This is a question that Dennis Gehman asked that I answered live on The Remodelers Show – see the written answer below – hear me answer the question live here.

“How much backlog should we have before turning down small projects and only accepting projects that are $100,000 or more?” – Dennis

I know Dennis’s business and in normal times, that’s more the ideal project that he takes on – the bigger projects. With the pandemic, with COVID, with everything that is going on, he, like a lot of remodelers, has been a little bit more open to taking on some smaller projects. 

To answer Dennis’s question, I would say it depends on who I’m talking to. I know that some of my clients have more stomach for a shorter backlog than others. Some of my clients, if they don’t have 3+ months of backlog for their team of six people out on the field – they start to get nauseous! I have other clients that feel fine about having 5 weeks of work ahead of them.

The guy that needs 3+ months would have a very hard time understanding how the guy with 5 weeks of backlog is okay. So everyone has a little bit different stomach for how big of a backlog they want.

If you schedule out too far it can become a little bit of a sales problem where some people might not want to wait that long. There’s a lot of different factors in play here. 

Dennis, my biggest thought for you is this: If a previous client approaches you about a small project, we are going to be much more open to taking on smaller projects and little things for them. We want to continue to enhance and develop that relationship and trust that we have with our previous clients. But if it’s a small project for someone we’ve never worked with before, and we’ve got a really strong backlog (which as we said means different things for different people), we might turn that down.

So my answer is that I want to know how many irons in the fire you have out there. If you’ve got 6 things under design and development that you are feeling really good about and you’ve got two and a half months of backlog, and you think you are going to get from two and a half to four months of backlog in a hurry, my advice is different than if you said, “You know what, we’ve got two and a half months of backlog but I don’t have a lot in the hopper.” In that case, I might say to continue to push on those small projects.

So, it depends on multiple factors, but those are some things to think through. I hope that helps!

The other thing I would encourage you to do is to really get clear with this month, next month, and the following month. We have a spreadsheet that helps you calculate your backlog. If you want a copy of that email Bailey (bailey@remodelyourmarketing.com) and ask her for it! 

Using this spreadsheet you can document all of your projects that are sold (not that you might sell) and how many labor hours you are expecting for each of those different projects. In the spreadsheet it’s got a formula that says, “Okay, based on the number of hours that you have sold and that are still remaining, and based on the number of guys you have out on your field, here’s how many weeks and months that you have as far as backlog goes.” 

When you have that and you’re clear on the amount of backlog you have, that helps you make a decision about which projects to take. 

When you’re unclear with that and you are just operating off of how you feel, not facts, then it’s a little riskier to turn things down. But once you have the facts about your backlog, then you can make clearer and better decisions. 

If you want a copy of the backlog spreadsheet, Email Bailey at bailey@remodelyourmarketing.com and ask for the spreadsheet for the project backlog and we’ll send that over to you. 

Raise your mark-up 1% today!

I’ve been sharing some thoughts over in the Remodelers Community Facebook Group about ways to strengthen your business.

Here they are – I hope they’re helpful!

  1. Raise your mark-up 1% today! – You’ll still sell the job & it will lead to $1000’s of additional Gross Profit $’s this year. DO IT!
  2. During the sales process, always schedule your next meeting before you end the current meeting. Self-imposed deadlines!
  3. If you’re not doing it already, start charging for Design & Project Development. It’s a valuable SERVICE you’re offering!
  4. How you finish the job is more important than how you start it. Work hard to finish strong!
  5. Your previous clients are your most valuable marketing asset. Do you have a plan to stay in touch with them consistently?
  6. IF (that’s a big if) you’re not able to present your proposal in-person AT LEAST present it via Zoom. Emailing lowers close rate.
  7. Tell prospects your story and why you love what you do. Tell them about your team – how great they are. Build know, like, & trust!
  8. Get your step-by-step remodeling process in WRITING and practice presenting it to prospects. It’s really key!
  9. Be excited about their project! When you talk to a homeowner and you’re excited, that excitement is contagious.

Which one resonates the most with you? Email me at kyle@remodelyourmarketing.com and let me know!

P.S. – At 12:00PM EST – we’ll do Day 11 of The Remodelers Show! Visit TheRemodelersShow.com for more information on how to join in LIVE!

P.P.S. Have you checked out Remodelers AutoPilot yet? Try it for $1 – it will help you generate more repeat and referral work.

New, Over-the-Top Value

Something I wanted you to know about:

I just got done yesterday with the first Remodelers AutoPilot Live Q&A Call! (You can learn about Remodelers AutoPilot here: www.RemodelersAutoPilot.com)

In addition to the done-for-you email newsletter, done-for-you social media posts, and done-for-you blog post option, Remodelers AutoPilot now includes a monthly Live Coaching Call with me where I can share ways to grow your remodeling business and answer any questions you may have (did you know it’s only $1 to try it out for the first month?)

Here are the questions I was asked by Remodelers AutoPilot clients yesterday:

  • Outside of repeat and referral work, how should we be marketing our business for growth?
  • How do we grow our Facebook audience to reach new people?
  • What’s the best metrics to look at regarding web site visits?
  • Should we set our marketing budget as a percentage of our revenue or a fixed dollar amount?
  • I also shared some teaching related to your financials, job costing, self-imposed deadlines, and more (to fill in the full 45 minutes!)

If you’ve been thinking about Remodelers AutoPilot, this monthly call is another over-the-top value add you will enjoy.

You can check it out here: www.RemodelersAutoPilot.com

About the cowboy hat

Don’t worry, I got permission to use this from my client…

About the cowboy hat – when I dialed in for my Zoom video conference coaching call with her and her husband yesterday, she was wearing the cowboy hat. Having never seen it before I said, “What’s with the new cowboy hat??”

She replied, “Well, it just got delivered by Amazon today – we’re going to a Brad Paisley concert this week and I felt like I needed something country to wear!”

So that’s the story of the hat, more importantly, here’s what she’s holding up.

You may have heard me (and others) say: What gets measured, gets improved.

To help my remodeling clients keep their Total Sales goal in mind (the amount that you see on the top line of your P&L) – I like to have them create a ‘Sales Thermometer.’

They put their goal at the top of it and every time they make a new sale, they color it in. It’s a simple thing, but it really keeps first things first. And it’s usually the first thing they do after they get the sale made!

A couple takeaways you might have from this:

  1. What is your sales goal? How are you doing with it? Track it! What gets measured, gets improved.
  2. Sometimes, having physical, in your face reminders is helpful – have fun with it – create something to keep track of your top priorities.
  3. The only Brad Paisley song I know is ‘Ticks’ – I ended my coaching call with this client by reading the last verse of ‘Ticks’ (you can find the lyrics here if you’re dying to know!) to them as if I was reading poetry. It made them laugh. Laughter is good medicine – don’t take business too seriously and make sure that you, your employees, and your clients are having a little fun along the way.

P.S. When was the last time you reached out to your previous clients? Remodelers AutoPilot can help you do this effectively and consistently – you can try it out for $1. It’s good marketing for your remodeling business! You can sign-up here.